Marketing to the 2026 Consumer

If you want a glimpse of the 2026 consumer, look up Amanda Steele. She’s a typical California high-school senior; a self-professed coffee lover who listens to Drake and says economics is her favorite class.

But in 2010, Steele began posting makeup and beauty tutorials on YouTube from her bedroom as a way to connect with fellow teens. Today, her YouTube channel MakeupbyMandy24 has 3 million subscribers, and has garnered Steele her own branded makeup collection, a modeling contract and a steady stream of red carpet appearances.

And while Steele’s level of success may be an exception, her prioritization of influence over affluence is quickly becoming the new consumer-value norm: he or she who can enact the greatest behavioral change wins, regardless of their financial position. It’s what A.T. Kearney is calling “America’s Next Commercial Revolution.”

WHY IT’S HAPPENING

While A.T. Kearney highlights several reasons for the shift from affluence to influence, the widening gap of income inequality is perhaps most instrumental.

According to its November 2017 report, the Pew Research Center found that “the median wealth of upper-income families was seven times that of middle-income families; a ratio that has doubled since 1983. Upper-income families also had 75 times the wealth of lower-income families in 2016, compared with 28 times the wealth in 19831.”

Traditional consumer models have fostered the belief that self-worth exists in direct relationship to what consumers buy, or, “I am what I own.” But because of rising income inequality, the youngest consumers began looking for other forms of currency that didn’t require traditional financial capital. 2026 consumers are shifting their self-worth to their ability to “create change and build community by influencing my peers2.”

Prioritization of influence over affluence is quickly becoming the new consumer-value norm.

In other words, influence is everything.

WHAT WE THINK

We as food marketers must begin shifting our approach to brand development and brand building in preparation for the Influence Model for consumption.

  • Affluence Model: Consumers are inspired by brands and value brands for their personality and what they do
  • Influence Model: Brands are inspired by consumers and consumers value brands for who they allow them to be

WHAT’S NEXT

The emergence of the Influence Model for food marketing means rethinking how we tell brand stories and connect with consumers. Specifically, it will mean a shift away from providing inspiration to nurturing aspirations. Here are just two ways this shift will impact our business:

Brand Narratives

Inspiration: Brand stories or narratives built upon company values

Aspiration: Brand stories or narratives built upon consumer values

Dave's Killer Bread

Dave Dahl was a convicted felon who, upon serving a 15-year prison sentence, was given a second chance to rejoin his family’s bakery business.  Dave worked tirelessly to create his namesake bread and, for every loaf sold, now donates a portion of the profits to the Second Chance Project, an organization that gives the 1 in 4 Americans with criminal backgrounds a second chance at meaningful employment.

Recipe Inspiration

Inspiration: Give consumers products to recreate our ideas

Aspiration: Give consumers the knowledge to bring their ideas to life

Kitchn's DIY KombuchaTraditional/Affluence-Model consumers look to food and beverage brands for ideas on social media they can easily replicate at home. Influence-Model consumers already have good ideas, but lack the tools or skills to make them a reality. Take a cue from The Kitchn, which has an amazing arsenal of trendy how-to’s, like this article on making your own signature kombucha.

Just some Thought for Food

1“How Wealth Inequality Has Changed in the U.S. Since the Great Recession, by Race, Ethnicity and Income.” Pew Research Center. 1 November 2017.
2“America’s Next Commercial Revolution: Influence vs. Affluence.” A.T. Kearney, Inc. 2017.

Winning with Big Food: Part 2

The battle between Big Food and small food was no more apparent than last month when the Brewers Association (BA) unveiled its Verified Independent Craft Brew seal.  The association—whose mission is to promote and protect America’s small and independent craft brewers—makes the seal free to all members.

Brewers Association Independent Craft Brew seal
Brewers Association Independent Craft Brew seal

The catch: Breweries must “run their business free of influence from other alcohol beverage companies, which are not themselves craft brewers.”

Cue frustrated response from a group of independent brewers who are technically owned (25% or more) by Big Beer:

"At the end of the day, the beer does the talking - not the label on the package - and the consumer makes up their own mind. The problem is, the Brewers Association continues to refuse to let the consumer make up their own mind and tries to make it up for them." Garrett Wales, Owner, 10 Barrel Brewing Co.

Why It’s Happening

Over the last few years, we’ve seen Big Food purchase smaller brands for a variety of reasons, yet the customer response is increasingly negative. They threaten boycotts, rant on social media and accuse independent owners of selling out. What’s behind the vitriol?

Consider the following:

  • *35% of U.S. consumers distrust big brands.
  • *60% of U.S. consumers distrust corporate America.

It all boils down to customers believing that Big Food will change—or destroy—what they know and love about the brand.

What We Think

Big Food should proactively prioritize building—or rebuilding—customer trust by focusing on the interpersonal customer relationship.

In their 2016 “Customer Quotient™ U.S. Report,” C Space reveals that customer trust “is about much more than having confidence in the reliability of a product. It is founded in the relationship.”

Big Food has done remarkably well in developing beloved brands that are high in quality, safe for families and delicious.  But in a world where those deliverables are considered table stakes, Big Food must also work to strengthen those personal connections customers have with the brand and the company behind it.

What’s Next

To get personal with customers, Big Food needs to be more personable.

Speak with an authentic human voice. Communicate like a real personremove the marketing fluff and the corporate talking points. We must say what we mean rather than forcing customers to interpret our message.

Case in point: In the days following a forcible removal of a passenger from a United Airlines flight in April 2017, the company’s CEO Oscar Munoz learned just how damaging corporate-speak can be in the midst of a scandal. On April 10, Munoz released a statement that was regarded as callous by customers. 

Corporate voice example from United

The statement caused a firestorm on social media and United Airlines’ stocks began tanking as news of the incident and the company’s response went viral. Less than a day later, Munoz issued a mea culpa to the press.

Human voice example from United

Highlight your people. Customers crave a personal connection, so help them get to know you on a deeper level. The Johnsonville Sausage campaign from 2016 is a great example; the ads were inspired by—and featured—real employees.

Keep Small-Brand Acquisitions Autonomous. The frequency of mergers and acquisitions within the food and beverage space is likely to continue for Big Food to realize continued growth. But to ensure those small-brand customers stay with you, Big Food must encourage any acquired company to stay true to its roots.

Stay tuned for our third and final installment of “Winning with Big Food” in September.

Missed Part 1? Read it here

*Source: “Untruth and Consequences.” Iconosphere 2017. Iconoculture Consumer Insights.

Winning With Big Food: Part 1

‘How can ‘Big Food’ win?’ was a question on everyone’s mind at this year’s Iconosphere conference in Las Vegas. As one of the industry’s leading consumer insights conferences, hosted by Gartner (formerly CEB), food & beverage strategists reiterated arguably the biggest challenge ‘Big Food’ faces in today’s marketplace: small and medium manufacturers are driving half the growth in the CPG channel.

Smallest Manufacturers are Driving More than Half of Growth in CPG

2017 The Nielsen Company (US), LLC

Even though this data only represents retail data, we can’t ignore that changing customer demands in one channel aren’t influencing product decisions across foodservice, or even food at retail.

WHY IT’S HAPPENING

Most analysts agree small and medium brands’ ability to respond to rapidly shifting trends, their focus on ‘clean’ ingredients, and increased availability have largely contributed to their success.  

These explanations highlight a common theme: ‘Small Food’ is perceived, by customers, to be better than ‘Big Food.’ Whether it’s the impression they use better ingredients, follow a better process, or create better-for-you products, ‘Small Food’ is increasingly perceived as a better choice.

WHAT WE THINK

‘Big Food’ needs to tell its story.

Brands and manufacturers of all sizes are necessary and vital players in today’s dynamic food system. ‘Big Food’ plays a significant role in bringing food to our kitchen tables, favorite dining spots and emerging spaces where millions seek sustenance on a daily basis. This isn’t a David vs. Goliath narrative; it’s about reminding customers the importance each party plays.

WHAT’S NEXT

Customers want to feel good about their food and beverage purchases, and ‘Big Food’ has a great story to tell, particularly in three key areas:  

  • Consistent supply. We’ve been with many of our customers since their beginning. We’re on the shelf, in the case, and in the kitchen when and where we’re needed without fail.
  • Record of safety. Our size gives us the ability to ensure the safest possible food with investments in the latest technology and equipment available.
  • Higher standards. Volume speaks loudly. We can dictate which farmers/co-ops we work with, demand more responsible care of our crops and animals, and ensure we get first choice on ingredients which, ultimately, means higher quality for our customers.

Look for Winning with Big Food: Part 2 next month!

The Case for ‘Product Narratives’ in Today’s Marketplace

Narratives in marketing are nothing new; we’ve been telling stories to customers since the invention of our trade. But the narratives that resonate with our target audience has shifted substantially over time. At their latest A.C.T. (Anthropology, Culture, Trends) Conference, “Telling the Story of Food,”, The Hartman Group asserted that brand-focused narratives are quickly being replaced by product-focused narratives.

The Case for ‘Product Narratives’ in Today’s Marketplace

Source: “Telling the Story of Food.” The Hartman Group. April 2017.

Why It’s Happening

Based on their research, The Hartman Group explains that over time, our values have evolved from ‘practical and rational’ to ‘contemporary and experiential,’ which have resulted in product narratives to gain traction.

Consumer values have evolved.

Source: “Telling the Story of Food.” The Hartman Group. April 2017

What We Think

Product narratives present a unique storytelling opportunity for marketers.

‘Old’ values and ‘brand narratives’ aren’t obsolete; affordability, consistency and convenience are certainly still important. But in today’s marketplace, these attributes are simply the cost of entry.

As our industry continues to change and our target audiences’ demands evolve more rapidly, ‘product narratives’ give us, as marketers, a unique tool to stay fresh and pertinent with tomorrow’s customer.

What’s Next

Ultimately, our goal with any new product initiative or legacy-brand refresh is singular: relevancy with our audience. Choosing the appropriate narrative – or combination of the two – will depend on your business objectives, target audience and go-to-market strategy.

Regardless of approach, we must successfully address the customer’s most important question: what’s in it for me?

Just some Thought for Food™

Questions, comments or want to learn more? Let's connect! akile@jtmega.com

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