When a jazz saxophonist turned beverage entrepreneur sells a healthy juice business to Coca Cola for $181 million, his next venture deserves some attention.
George Steltenpohl started Odwalla in 1980, pioneering healthy drinks to line up in grocery stores is now onto his next venture — Califia Farms, which wants to experiment with nut milks. Of its 76 products, 28 are coffee drinks. The category as a whole is growing, and Califia is trying to capture the plant-based corner.
But the real question is less about how these products compare, and more about what is pushing Califia towards this trend. And the answer is the changing American diet.
The American diet has been getting healthier over the past few years and it’s reflected in consumers’ shopping habits and what they fill their carts with, at grocery stores. Changing food habits are both a cause and an effect of the evolving consumer, and often signal a change in income, tastes, dietary fads and healthy lifestyle choices. And, over the past decade, more Americans have been abandoning dairy.
But as the market evolves with the consumer, we stop to ask — How quickly are consumers adopting these changes? Are brands paying attention to the vicissitudes of consumer preferences? And, how exactly are companies filling the white space between demand and supply of products.
Social media data is the perfect place for brands to search for the answers to these questions and identify gaps in consumer demand and market supply. In this post, we look at how brands are innovating to fit changing consumer preferences by highlighting the following product changes:
- Kraft’s natural mac-n-cheese
- Aspartame-free Pepsi
- Califia Farm’s flavored nut milks
Who moved my cheese?
In 2015, Kraft Foods changed the ingredients of its iconic mac-n-cheese to make it healthier by doing away with preservatives. Kraft moved on this after a Change.org petition with 365,000 signatures asked the company to remove dyes from its macaroni and cheese.
The company didn’t have to look beyond social media to pick up on changing consumer preferences. On social, consumers have been talking about shunning foods with preservatives since 2010.
And as Kraft observed, replacing artificial flavors, dyes, and preservatives with natural ingredients like annatto, paprika, and turmeric increased sales to 80 million boxes.
As it goes with most best-selling products, a shift in taste could have disastrous effects like General Mills observed with its cereal Trix but Kraft played the maneuver well by marketing the new recipe on social media with the hashtag #didn’tnotice.
“Consumers have been telling us, and parents in particular, that they want to feel good about the foods that they eat and that they serve their families….”the one thing they are most adamant about,they absolutely don’t want us to change the taste,” Triona Schmelter, Kraft’s vice president of marketing for meals told Chicago Tribune.
Consumer attitude towards additives can be quantified using sentiment analysis. When we looked at how consumers feel towards certain ingredients, we learned that additives elicited the most negative sentiment among consumers.
Sugar, salt, wheat, additives and flour were the five most mentioned ingredients in the discussion of ingredients to avoid, with a steady share of voice from 2010 to 2016. Sugar and salt are discussed the most, followed by wheat, additives, and flour. Of all these ingredients, additives and sugar are discussed most negatively.
Get social insights delivered to your inbox.
Our food today has become so processed and packaged, so full of preservatives and plastics, that it has become fake food.
— Esoteric Exposal (@EsotericExposal) November 20, 2017
Avoid food additives, processed foods. MSG is neurotoxic and is disguised by 40 different names.
— Terayzea (@terayzea) November 20, 2017
Kraft implemented this shift towards healthier substitutes in other products as well. For example, it started sweetening Capri Sun with plant-based stevia leaf extract instead of artificial sweeteners as well as eliminating high fructose corn syrup.
Taste or health? You choose
For Kraft, the experiment of replacing additives with natural ingredients worked. But not all brands have that luck. When Pepsico swapped sweetener aspartame with sucralose, in hopes of reversing slumping sales, it didn’t expect the sort of backlash it received. Consumers didn’t like the taste of changed Diet Pepsi, which caused sales to plunge further.
All of PepsiCo’s diet soda sales fell 6.6 percent in the U.S. towards the end of Q3 in 2015, worse than the steady decline of 5.7% from the preceding year.
Like foods, beverages have also been called out for their unhealthy ingredients. Consumers are becoming more cognizant of what goes in their creamers and all too often, unrecognizable ingredients are labeled as chemicals. Ingredients that top this list are: additives, aspartame, high fructose corn syrup and hormones.
We know that there is chatter on social about the drinks people like and dislike, but what do they discuss when they talk about these beverages? We identified that the conversation centers around three main factors: ingredients, health consciousness, and consumer preferences.
When we analyzed the conversations on social to glean specific sentiment associated with these ingredients, we found that unsurprisingly, most were negative. Aspartame topped the list as people called it a cancer-causing substance which also induces mood swings. High fructose corn syrup, a cheaper alternative to sugar, also is discussed negatively for its association with diabetes.
Although social media data attests for the fact that consumers want to avoid aspartame in their soda, it turns out, balancing health and taste is more trickier than it seems. And a compromise on either isn’t an option for brands either.
People actually think aspartame healthier than sugar, I really don’t get why people so much more comfortable with chemicals than calories
— Dylan ❤️ley (@Dylan_Charles97) November 11, 2017
While allergens keep most away from dairy, for many, going dairy-free or gluten-free has little to do with allergies than trying a different diet. When we analyzed consumer conversations around intolerances and adopting dairy-free as a diet, we found that there is an increase in the number of consumers who express the intent of going dairy-free on social with words like ‘choosing’, ‘trying’, ‘considering’, or ‘wanting.’
Naturally, this has given rise to the search for alternatives. Among non-dairy products, almond milk is the most popular option, cutting into the soy milk conversation over the past six years.
Almond milk has risen from 30% share of voice in 2010 to 50% in the past year. Coconut milk, however, appears to be making a comeback while cashew milk has found its way into discussion in just the past three years. In fact, a Nielsen study showed that almond milk is the country’s favorite milk substitute, clocking 250% in sales growth since 2010 and globally, the almond milk market is set to grow 15% CAGR between 2016 and 2020.
Considering the demand for non-dairy alternatives, Steltenpohl has definitely hit a sweet spot in the market. But what can Califia do differently from other brands? Introduce flavors. Steltenpohl criticizes nut-based milks as only being differentiated only by things like skim, whole and chocolate. Some of Califia’s flavors include cinnamon horchata, chocolate coconut and even holiday nog.
“We want to make it easy for people to go plant-based and dairy-free with better packaging, more enticing flavors and the exploratory aspect of it,” Steltenpohl said.
And consumers seem to be loving it.
I LOVE dairy free egg nog, it goes great with bourbon! Silknog was my favorite for years but now I’ve switched to Califia Farms (pictured below⤵) pic.twitter.com/QIMpYMweva
— Trash Buddha (@GuerillaMonk) November 21, 2017
Understanding evolving consumer preferences accurately and delivering products tailored to those can be often tricky. Sometimes, brands like Kraft and Califia can hit a jackpot, and at other times experiment like PepsiCo’s can fail. Dietary fads will come and go, but when they do come, it might be worthwhile for brands to milk the trend by tuning into consumer conversations on social media. And as usual, brands can tune into social media insights to identify white space in their market and use that to iterate on their product.
For more on CPG brands, download our free CPG trends report here: