USDA data is directional for food marketers

December 23, 2009

Set aside for a moment the past two years of commodity price volatility, which disrupted long-term food consumption patterns in the United States.

Set aside for a moment the past two years of commodity price volatility, which disrupted long-term food consumption patterns in the United States. 

Rather, CPG brand marketers and retailers, take a look at the ten-year snapshot of what people eat and how much they eat, by the U.S. Department of Agriculture’s Economic Research Service. The newly released study that ran from 1998-2007 still yields valuable insights into shifts that were underway before the economic blowup – and which we think at ought to continue to influence the kinds of products launched or culled from brand portfolios, as well as the assortment strategies, consumer messages and merchandising tactics retailers deploy to connect with shoppers.

These data can give CPG and store operators an essential macro-sensibility to the public’s ever-changing relationships with food. Certainly, once the 2008-2009 data are available, price volatility and emotional stresses will be evident in further shifts in the people’s choices. Other key filters to consider: mounting consumer concerns over food safety, given the recent spate of recalls due to E.coli and salmonella contamination, as well as animal cruelty, and sustainability, to name a few. 

We encourage retailers to lighten up assortments in categories that people are eating less, such as ice cream, the USDA ERS data show. Similarly, manufacturers could trim their ice cream portfolios and redirect resources toward other brands with more promise, or else reformulate their ice cream products to be more healthful and in tune with the better-for-you consumer mentality. According to an Oregon Department of Agriculture write-up of the USDA figures, per capita ice cream consumption melted from 16.3 pounds in 1998 to 14 pounds in 2007, while yogurt per capita consumption nearly doubled from 5.9 pounds to 11.5 pounds over the same period.

Cheese consumption rose from 27.8 pounds per capita in 1998 to 32.7 pounds in 2007, partly due to the popularity of pizza and other quick-serve products in which it is an ingredient.

However, fluid milk consumption suffered the biggest per capita decrease over this ten-year span – from 198.5 pounds in 1998 to 178.2 pounds in 2007. This looks to be a fat-reduction strategy by Americans, who sliced their whole milk consumption down from 69.5 pounds down to 55 pounds, while drinking a bit more lower-fat milk than before, at 96 pounds.

Other trends:
•    In the meat case, per capita beef consumption dipped from 64.5 pounds to 62.2 pounds; pork, veal and lamb also fell. Chicken, however, rose nearly 20% from 50.4 pounds in 1998 to 59.9 pounds in 2007.
•    In the fresh produce aisle, per capita consumption dropped from 129.1 pounds in 1998 to 126.2 pounds in 2007 – possibly because of higher import prices, particularly bananas, the USDA said.

Food stores can be far more responsive – and therefore far more productive – when they work in concert with shoppers’ desires. By better serving people’s dietary, budgetary and emotional motives, as indicated by these data, everybody will win.