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How Transparency Increasingly Impacts Food Retail Purchases

Shoppers increasingly demand transparency and a closer connection to their food, so much so that 75% are more likely to switch to a brand that provides more in-depth product information, revealed a new report from Label Insight and Food Marketing Institute (FMI).

The Transparency Imperative report found that grocery shoppers exhibit loyalty to those products that create deeper relationships through information exchange.

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FMI, with support from Label Insight, developed this report with the goal of defining what transparency means to shoppers and how it impacts their food retail purchases.

In the report, 86% of shoppers agreed that if food manufacturers or retailers provided access to complete and easy to understand definitions for all the ingredients, it would result in more trust.

Nearly as many shoppers (80%) said that they are more likely to be loyal to a brand that provides more in-depth information, beyond what is provided on the physical label. More than half of shoppers (54%) are even willing to pay more for a product that has additional product information.

“The new shopper mindset requires brand owners to think about their products well beyond the traditional label and respect a more digitally-minded consumer,” FMI Vice President, Industry Relations, Doug Baker noted.

The vast majority of consumers (69%) say it is extremely important or important that brands and manufacturers provide detailed information such as what is in their food and how it is made. Interestingly, online shoppers (80%), college graduates (76%) and higher grocery spenders – $125+/week (75%) – were more likely to agree with this sentiment.

When asked to further define what elements define transparency, older generations (Baby Boomers and Generation X) are more likely than Millennials to focus on a complete list of ingredients, ingredients descriptions, and nutritional Information.

Millennials also focus on these indicators, but they are more likely than older generations to look at allergen information, certifications and claims, explanations of ingredient usage information, and other details such as animal welfare, fair trade and labor practices.

“We titled this report The Transparency Imperative because as we executed the research to bring the key findings of our 2016 studies current, we see clearly that transparency is only becoming more important to consumers,” said Patrick Moorhead, Chief Marketing Officer for Label Insight.

Nearly half (47%) of American households have someone on a diet or following a health-related program. These shoppers are even more likely to place a premium on transparency – 61% will pay more for products that offer in-depth product information, versus 54% of general shoppers.

Consumers prefer to buy groceries in stores instead of online

When a label is not sufficient, these shoppers (89%) are very likely to seek out information elsewhere. Nearly half of this segment (47%) would be very likely to use a smartphone in-store to find additional information beyond what’s available on the label and the shelf.

The study also found that the presence of children in the home increased the desire for transparency. Shoppers with children are more likely to place greater importance on ingredient information, nutrition and health benefits.

They were also particularly likely to find value in accessing detailed product information in-store on their smartphone (87%) and to use this method (85%).

Grocery E-commerce Increases Transparency Expectations

The study found that 26% of shoppers purchased groceries online in the last 30 days. Yet this group represents a valuable demographic – they are more educated, have higher household incomes and more likely to have children under the age of 18.

While Millennials are disproportionately shopping online, they only make up 39% of online shoppers. Generation X (30%) and Baby Boomers (23%) also represent a significant portion.

Online grocery shoppers expect more product information (76%) when shopping online than if they were in a physical store; and 72% believe that getting product information is even more important when shopping online. Additionally, 81% are willing to switch to a brand that provides more in-depth product information, compared to 75% of general shoppers.

About Hernando Ramírez-Santos

Editorial and Social Media Coordinator, Abasto Magazine. Accomplished and innovative leader and journalist with over 30 years of experience in print, digital, radio and television.

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