Every household in the UK contains products tested, improved and launched with the aid of research from The Oxford Research Agency.
In its annual review of the year, The Oxford Research Agency examines what trends will emerge and which will continue to grow during 2009. Interestingly, some will be put on hold.
The last three months has seen a seismic shift in consumer behaviour as the recession starts to bite. Hitting the economy and consumers throughout Autumn into Winter, many economists are forecasting a sharp downturn throughout 2009, before recovery starts in 2010.
No predictions can ignore the impact of the global economic shock and how consumers might react throughout 2009.
Our thoughts on the trends of 2008, and how these could manifest themselves in 2009, are:-
Rising Trends
- Price, Price, Price
Throughout 2008, the main research briefs received by The Oxford Research Agency concerned price. Earlier in the year it was food inflation, now the focus is on providing value to consumers, without compromising quality of the product.
Price point will be critical in 2009; further launches of ‘Market Value’ brands such as those launched by Tesco will further question consumers loyalty to brands. As such, reducing costs to consumers and improving product quality will be critical to maintaining share for brands in 2009.
- Convenience
The driving force of new product development for the past 30 years, convenience will continue to drive innovation and sales in 2009. However, with price a critical factor, unless the added convenience has high added value for the consumer, some new products could take time to gain traction.
- Back to basics
Limited budgets have already seen a ‘see-change’ in consumers buying behaviour. Through 2009, expect to see ready meals sales flatten off as consumers look for easy to prepare meals at home (see the rise in Baked Bean sales, Cereals and other staples).
Although it is unlikely that we will see an explosion in consumers using all of the cook books they have, simple meals which can be made for less than £5 for the family will continue to grow.
- Limited time to prove the worth of NPD
Shelf space is valuable. In certain categories, you have less than 4 weeks to prove the worth of your NPD before it is removed from shelf.
With promotions and price becoming more prevalent (30% of products on promotion in Sainsbury compared with 25% last year), shelf space will be needed for existing brands.
You will need a strong argument with the trade, backed by validated volumetric forecasts to ensure your NPD gains shelf space. And, once there, you will need to go on promotion immediately to show your worth.
Speak to The Oxford Research Agency on this, we have validated models which cover over 3,000 studies and are validated to +/-9%.
- Personalisation
Linked to back to basics, the growth in products which consumers can tweak and optimise will continue. For mass market brands, allowing and encouraging consumers to change the flavour, consistency and colour of the food will provide new opportunities. Collecting this via feedback panels to understand the new avenues open to you will be vital to future products.
- Little luxury
Amid the doom and gloom, consumers are looking for the small bits of affordable luxury. Smaller versions of expensive products will remind and maintain loyalty of those consumers who want to buy your products but cannot afford to.
- Down trading
Already happening on a large scale, with consumers trading down brands, but also trading down on meal types. Key for brands which are gaining sales in these times will be maintaining the sales once the economy starts to grow and consumers have a little extra money to spend.
- Power of discovery
Consumers like discovering new things and discussing these with their friends and family. Advocacy has taken a new direction with consumers passing on money saving tips, discovering cheaper versions of their cherished products.
Help them discover and reap the rewards of discovery.
- Happiness
As Spring 2009 approaches and winter recedes, consumers will be looking for products which give them comfort. Although money will be tight, the products which can give them a little happiness will benefit in Summer 2009.
Positive and forward looking brands will benefit next Summer as consumers look to escape the past year of bad news.
- British is Best
Consumers will be looking to support British products, to help Farmers, manufacturers but also their friends and colleagues get through the recession. Government will likely kick start this movement after Christmas, a move which will be widely supported by consumers.
Trends on pause
- Organics
With tight budgets, consumers are switching out of organic products for the time being. This will be a critical moment for the organics movement, as consumers question the real worth of organically grown food. In particular, with consumers experiencing non-organic food and finding little difference, Organic food is likely to shrink in importance.
- Eco products
Generally costing more, consumers are happier to put the environment on hold whilst they consider the cost of the family food basket. However, the environment will not go away as a trend and will re-emerge in 2010 as a key driver going forward.
- Everyday Premium
Suffering at present, high costing products which have cheaper offerings are suffering considerably and are likely to do so for most of 2009.
It will take a change in the economic outlook and significantly better products to ensure that the high value products in the grocery sector start to grow again.
- New science
Self treatment is still on the rise with consumers. Products which consumers feel and recognise the benefits of will continue to grow (think Cholesterol reducing products). However, those where consumers struggle to recognise a benefit will be hard hit next year.
This sector will re-emerge in 2010, but could have a tough year in 2009.
The Oxford Research Agency tests thousands of new ideas and products for the UK’s largest manufacturers and retailers. To see if we can help you, call Chris Sinclair, Managing Director, on 01865 728272, or email Chris at
chris.sinclair@tora.co.uk
