Consumers are in search of food they will enjoy multiple times of day and every day. About 60% of meals are prepared at home, but 76% of consumers claim to be bored with their food. For example, the average US household uses only 0.8% of the food items available to them to prepare one of their 9 standard household meals. The reason is a lack of availability of personalized and contextualized information to consumers, who are generally risk adverse when it comes to trying new products, dishes or cooking new recipes. The food ecosystem participants are well aware of this fact and have been unsuccessfully attempting to influence consumers. For example, less than 3% of the more than thousands new products launched every year succeed.
Consumer behavior and their relationship with food have drastically changed in the last years. In particular, millennials, people concerned with healthy lifestyle and busy moms (all primary target groups for Brand advertising and promotion) have asked for more digital support when navigating the food ecosystem. For example, the top two most talked about topics across social platforms are music and food. Moms have consistently ranked “What’s for dinner tonight” in their top three most stressful moments.
Interest in a healthy lifestyle has also made a large impact on consumer food choice. Nutrition is in the top three criteria of food choice, just behind taste and value. These consumers represent over 13% of households. They are very information intensive and utilize many connected touch points in their food selection and shopping activities. Furthermore, health issues such as diabetes affects over 30 million people in the US, another 90 million are pre-diabetic – food and active lifestyle are key elements for disease management. These households are highly interested in assistance in finding food that they will enjoy that support their dietary objectives and requirements.
A staggering 50% of food purchase is influenced digitally by at least one digital touch point leading to companies investing their marketing dollars in digital marketing. However, despite shifting marketing dollars into digital (over $10 billion) it has been difficult for The Network Of Food players to effectively reach consumers. Only 5% of marketing dollars are spent in a truly targeted way. There are many reasons for this, but one of the main ones is that grocery shopping planning is an extremely fragmented, complex, and repetitive process (path to purchase – P2P) that relatively disconnected for consumers, all the while, being further complicated and influenced digitally.
One of the main entry points into this fragmented process is the grocery list that almost every shopper prepares before shopping. IRI believes that chances of a product being purchased are 80% once on a grocery list; Walmart says it is 90%. Another entry point to influence shoppers is their use of a smartphone. Two-thirds of smartphone owners use them in a grocery store; Google says 89% do. Retailers, manufacturers and publishers are working on influencing consumers by getting on their shopping lists and building smartphone apps, but with small success.
Common complaints from consumers are that there are too many recipes, too many products and too many services complicating choice. This creates consumer decision anxiety, and frustration has led to transactional friction at every point of the purchase cycle. Consumers are dissatisfied with the ineffectiveness with which their food needs are met, and retailers and manufactures are dissatisfied with their ineffective marketing efforts to influence consumers to buy their products on their 14 billion shopping trips per year to shops that carry about 35,000 items sustained by billions of dollars of trade spend.
In the US, retailers and manufacturers are losing at least $15 billion per year with untargeted, inefficient and increasingly ineffective tactics to activate food purchases by consumers. This means that manufacturers are losing $0.30 per $1 spend of the estimated $52 billion of trade spend.
Vast sums (now exceeding $6 billion over the past two years) are pouring into food tech start-ups trying to improve the food ecosystem and tackle the problems mentioned above. 80,000 food companies co-exist (with thousands new ones starting every year), but the one fundamental question “What shall I eat and will I like it?” has not been solved for the consumer. Consumer research shows that the number one driver for selecting food is taste preferences. Until now, all food and media tech companies have been trying to solve adjacent problems such as health and wellness, sustainability, food delivery, and recipes, but no one has centered their attention on solving the main issue that drives consumers: their “taste.”
Vivanda provides the means to enable all players in the food ecosystem to pivot to better serve consumers and deliver personalized and contextual recommendations centered on an individual’s taste preferences.