Food safety, healthier eating, and a more active lifestyle are a growing issue of concern in the United States. According to a Deloitte survey in 2010, nearly three quarters (73 %) of Americans are more concerned now about the food they eat than they were five years ago. The U.S. domestic news cycle for the first week of 2014 has been filled with issues surrounding the safety of the food supply and a push back against GMO-containing products. Within the first few days of 2014, the news reported on the mandated shutdown of a meat-processing facility in Minnesota by the U.S. Department of Agriculture, legal action in Oregon against the makers of a vitamin supplement and the announcement by General Mills regarding its processing of a major cereal product. The growing popularity of store chains such as Whole Foods and Trader Joe’s, and the increases in the amount of natural food line extension products, are indications of the shifting dynamics in consumer preferences in the U.S. Understanding the competitive nature of the global food industry means understanding changing consumer preferences and the food industry’s efforts to meet these demands. Food markets are constantly evolving, driven not only by changes in consumer preferences, but also, linkages between members of the food supply chains, prevailing policies, business environments and demographic trends. Changes in these preferences and perceptions may lessen the demand, reduce sales and potentially harm businesses.
In today’s world, consumers are becoming highly knowledgeable and interested in who, where, and when their food was produced. Consumers incorporate their concerns for animal handling techniques; potential environmental impacts from livestock production and manure; pesticide, and fertilizer application as well as the social impacts of production agriculture into their decisions surrounding food preferences. The task of moving food from the farm to the table has become more complex, involving diverse local, national, global agents and networks. Consumers and producers oftentimes speak different languages. Despite this disconnect, consumers are increasingly expecting transparency and information regarding agricultural production processes. Therefore, livestock markets are attempting to discover, through research and experience, which avenues to pursue in order to gain and in some cases regain consumer confidence in their labels.
Shoppers are also considering production process attributes, such as food safety when selecting food products. During the process of globalization, the borders among the markets of agricultural-food products have disappeared and technological innovations have taken their place while simultaneously increasing the number of foodborne illnesses. The declarations of food scandals, which occur from time to time, to the whole world by means of the media, has had a dramatic effect on consumers preference and has rendered them more sensitive to food safety. Due to such scandals in the media, many consumers have begun to lose their trust in the production system and public institutions on guaranteeing food cleanness. The economic burden resulting from foodborne diseases on the health systems and productivity losses are at significant levels as mentioned in Banati, D., 2003. “The EU and candidate countries: How to cope with food safety policies?”
Despite being well informed about safer products, consumers ultimately prefer to choose and enjoy the tasty alternative. This result is of great importance as found by Alexandra, P., 2007. “Does taste beat food safety? Evidence from the “Pêra Rocha” case in Portuga”. It appears that sensations related to taste beat the guarantee of food safety in driving the buying behavior since a large number of standards, labels and quality signals establish no link between the different attributes of the products and their methods of production. In 2013, the International Food Information Council Foundation (IFIC) conducted a survey focused on food and health and discovered that 87 % of the respondents said taste was the No. 1 reason for purchasing specific foods. Better taste reflects to better profits. Compromising on taste not only decreases the chances of a product’s success, in many cases it leads to a lower price in order to get people to buy the product. As a result, many of the initial efforts in producing healthy foods fail because the details on the packaging inferred to a tastier product than in reality. Certain sensations such as salt, sugar, and to some extent the sensation of fat become an expectation that people want to experience. Therefore regularly consuming fattening junk food can be addictive and lead to dire consequences.
In addition to a higher consumer preference of junk food because of taste, healthy eating really does cost more, as found by researcher Dr. Adam Drewnowski, director of the center for public health nutrition at the University of Washington. When they compared the prices of 370 foods sold at supermarkets in the Seattle area. Junk foods not only cost less than fruits and vegetables, but junk food prices also are less likely to rise as a result of inflation. The survey showed that low-calorie foods such as fruits and vegetables were more likely to increase in price, rising 19.5 % over the two-year study period were as high-calorie foods remained a relative bargain, dropping in price by 1.8%. These findings, which were reported in Journal of the American Dietetic Association, may help explain why the highest rates of obesity can usually be seen among people in lower-income groups.
Figure 1. Percentage of New York City residents: Who are obese and their household income by racial / ethnic group.
Source: New York City Community Health Survey, 2002. Obesity was defined as body mass index >30 kg/m2, calculated from respondents’ height and weight. Complete information was unavailable for Asian household incomes.
Although people don’t knowingly shop for calories per se, the data show that it’s easier for low-income people to sustain themselves on junk food rather than fruits and vegetables. According to Dr. Adam Drewnowski the average American spends about $7 a day on food, as low-income people spend about $4. Healthy foods are becoming more and more expensive with vegetables and fruits are rapidly becoming luxury goods, as those who consume twice as much in junk food calories are still spending far less than healthy eaters. With meals that consist of $1 burgers and super-size drinks, an American’s diet may be cheap with excessively high in grains, sugars, and factory-farmed meats. Adding to the problem, many on the most limited food budgets, such as those who receive food assistance dollars, live in “food deserts” – areas without grocery stores, and perhaps only a convenience store or a fast-food restaurant where they can purchase their food. The Department of Agriculture claims that more than two million Americans in low-income rural areas live 10 miles or more from a supermarket, and more than five million households without access to cars live more than a half mile from a supermarket. This is a recipe for current and younger generation to show higher signs of obesity, diabetes and heart disease. At $3.2 trillion, processed food sales are a major component of global food markets and account for about three-fourths of total world food sales. Still, only 10 % of processed food sales are traded products. Although consumer demands for processed food continues to grow globally, growth in processed food trade has generally stalled since the mid-1990s.
Overall we can notice across all countries a distinct trend that modern food markets are responding to consumer preferences at a local level, even as the food industry becomes more global. Today’s consumers have developed more dynamic, complex and differentiated demands. Changes in food safety, taste, health issues and the need for convenience have led food marketers to invest heavily in consumer insights and research to determine what consumers want. These changes in consumer behavior, reinforced by changes in the retailing sector, provide both a threat and opportunity within the food sector.