A Nation Divided – In Food Aisles

A report from SAI Marketing finds that eaters are increasingly breaking down into two groups: Food Elites and Food Realists.

Foot Elites, accounting for about 16 percent of higher-income U.S. households, culturally "identify with all the aspects of the foodie lifestyle as defined above and it forms a core part of their self-perception."

Roughly defined as college-educated from households earning $100,000 or more per year, the group gained more prominence with the post-recession, leading luxury consumers to shift their focus from "owning a luxury to experiencing a luxury." Experiential luxury includes artisanal food, travel, fine dining, spas and entertaining, mostly centered around food.

Boomers in this group are "at a life stage in which they do not need or want more things. They are the primary customers for experiential luxury offerings." Millennials’ lifestyle is defined "more by what they’ve done and experienced than by what they own. They are drawn to instant pleasure and lavish experiences."

Important factors for Food Elites include ingredients in general, locally-sourced food, natural versus artificial ingredients, simplicity (handmade vs. industrial produced), authenticity (knowing the place of origin), and heritage. Also critical is social foodism, including "food one-upsmanship" in socializing with peers as well as voracious consumption of food information on TV, magazines, online and word-of-mouth.

On the other side, Food Realists represent 84 percent of the population with price being the key driver of purchasing decisions. The group has a "common view of food that is much more functional in its nature. While they do exhibit some of the same communal rituals that the Food Elite do, they are much more constrained by finances and familiarity."

The two main sensibilities of Food Realists are price sensitivity and familiar taste profiles. They like to eat traditional and conventional foods often based on long held family recipes.

"The concept of food as a luxury item is totally alien to this group," wrote SAI. "They will indulge on occasion but that is seen as more of a self-reward than a way of life."

SAI appears to argue that food marketing should increasingly work similarly to how luxury vs. value messaging works in other categories. Messaging to Food Elites should be "grounded in high level food culture" and emphasize factors that are "more representative of higher socioeconomic status: use of more complex language, known to correlate with higher educational levels, and use more words and claims related health."

Messaging to Food Realists should focus on family recipes, family traditions and Americana. Said SAI, "Emphasize these roots and conceptually make reference to these proud traditions."

BrainTrust

Discussion Questions

Do you see a distinct bifurcation among food consumers in the country? What challenges may these two apparent viewpoints around food mean for retailers and marketers?

Poll

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Debbie Hauss
Debbie Hauss
11 years ago

With the proliferation of food and cooking-oriented television shows, more consumers have become educated about finer cooking and healthier cooking. They also are more aware of the value of organic and local products. This has created opportunities for all of today’s grocery retailers and food marketers to provide products that appeal to a growing segment of “foodies,” as they are called.

But foodies are not going to eliminate the “realists” of food purchasing…that’s why retailers like Target and Walmart have expanded the food sections of their stores. And, while foodies are looking for unique, upscale, healthy and organic choices, they also want the best prices for their staple products.

There’s room in the marketplace for both types of offerings, sold either together or separately.

Max Goldberg
Max Goldberg
11 years ago

Another study designed to enhance the reputation of the company doing the study. Why does the country have to be broken down into two groups? Isn’t is more likely that most consumers interact in both segments, rather than living in one or the other?

With the proliferation of television shows, magazines, websites and blogs themed to food, the opportunity to experience new types of ingredients and recipes is higher than ever. Consumers are enticed to experiment and retailers are challenged to keep the ingredients in stock.

Restauranteurs and companies that offer leisure experiences are offering a wide array of food-centered options at a variety of price levels, all designed to capitalize on food trends.

Consumers don’t have to choose between luxury and ordinary. They can move between both.

Ryan Mathews
Ryan Mathews
11 years ago

At this moment there are roughly 314,939,278 people in the U.S.—obviously not counting the undocumented. Does anyone seriously think that 16 percent of them are food elitists?

If so, a lot of people are missing the boat.

As for the 84 percent that are price motivated I strongly suggest the authors cruise by health food stores in inner city neighborhoods where people who can’t afford it are paying an upcharge for organics, etc.

I would comment further except for the fact that I’ve promised myself not to get irate every time some affluent individual or group begins talking about how sophisticated people like them are and how plebeian the great unwashed are.

You don’t need a college education or to belong to the “One Percent” to care about health. These elitist studies are really not worth discussing, so I’ll stop here other than to suggest that all marketers need to get out into the streets once a decade or so.

Fabien Tiburce
Fabien Tiburce
11 years ago

I am reminded of Bill Gates being asked by a student what it was like being a billionaire. His answer (I am paraphrasing), the first few millions make a tangible difference in your life, after that “it’s all the same hamburger.” Speaking of hamburgers…Bill Clinton likes them and so does Warren Buffett.

My point? We may not all be “elite” eaters, but there is a “realist” somewhere in there in all of us.

Tony Orlando
Tony Orlando
11 years ago

It comes down to money. Foodies can be foodies because they can afford to be. I am a foodie, but my customers are poor, and live in the real world. Focusing on value while offering 100% homemade foods in my deli is covering the 10% (if I’m lucky) of the customers that appreciate the better things in life.

The Dollar Store boom is happening because of the lack of income in most towns, and I doubt you’ll see a foodie looking around for the next great marmalade in their stores.

A lot of blogs here focus on the new age of food retailing, and I embrace all I can to adopt to the changes. The reality is that most folks are looking to fill the families with whatever is on sale to help pay the bills, and this is a problem for all of us in business. How much of our time and effort should we put into pleasing the 10-15% of the foodies, and lose the focus of bringing real value to the masses?

It can be done, but never forget your main audience, which still pays a good portion of the bills.

Mark Heckman
Mark Heckman
11 years ago

Just what we all needed, yet one more way to segment shoppers! But to be serious and totally honest, I don’t see much in the way of “new news” here other than a binary segmentation system where 84% of the shoppers fall into one group and the 16% the other, will likely lead to over-simplification of shopper behavior.

I think it IS important for retailers to understand the primary behavioral drivers of their predominant shopper groups, but it would be difficult for me to create an actionable strategy for a group that represents such a large number as the Food Realists, where is there bound to be multiple exceptions and nuances within the group.

To be fair, perhaps the research does breakdown sub-segments within the “Food Realists” group. However, from a retailer’s perspective, I would need some help understanding how this information in its current form could help me improve my business.

Cathy Hotka
Cathy Hotka
11 years ago

The premise for this study is absurd.

Walk into any Walmart grocery section and you’ll find a wealth of local and ethnic food that would challenge any self-professed foodie. Those dried ancho chilis, jicamas, and sea salts aren’t just for the banking elite—they’re for everyone. The country has undergone a transformation in the last 35 years, and eating habits aren’t the same. Sure, there are those who’ll keep eating Froot Loops for breakfast, but a broad swath of the population is taking a second look at its diet and preferences.

Nikki Baird
Nikki Baird
11 years ago

Well, I could buy that 16% are food elites. What I’m having trouble with is lumping everyone else—84% of the population—into one big group. Sorry, but no way. I don’t identify with either group, so where does that leave me?

My primary concern is health, not luxury, and I’m definitely not as cost-conscious as the 84% category implies—health is worth a tradeoff on price. And I’m also not nearly as radical as some moms I know—I certainly don’t force feed by children broccoli shakes, and when my kids asked me what a Twinkie was (gasp! what an oversight on my part!) I went right out and bought one so they could try it before they disappeared altogether (though, per the other article today, looks like that may not happen).

So I definitely look at that 84% grouping with a lot of skepticism. Sure, there’s a luxury market in food, and it could probably benefit from adapting practices from the luxury markets for apparel and other products. But that doesn’t mean that everyone else is “everyone else.”

Ralph Jacobson
Ralph Jacobson
11 years ago

I see the luxury food buyer marketplace expanding beyond the traditional demographics. The market as a whole is expanding globally, across income levels and other characteristics. Great CPG and retail companies are making higher-end food choices available to most every income level with better private label offerings.

The challenge is to compete on a national brand level with these PL offerings.