Nearly two-thirds of grocery shoppers would switch to brands that disclose more transparency than just nutritional and ingredient information, according to FMI-The Food Industry Association and NielsenIQ.
Although the COVID-19 pandemic has drastically affected shopping patterns in the U.S., consumers remain concerned about transparency and favor food brands and retailers that share information readily. However, as a new study from FMI-The Food Industry Association and NielsenIQ reveals, shopper’s perspectives on transparency have evolved and are much deeper and broader than they were a few years ago.
According to the report, “Transparency in an Evolving Omnichannel World”, which presents data from a survey of 1,035 U.S. adults who shop for groceries at home, today’s consumers want food brands and retailers to share more than just ingredient lists and nutritional information. They also seek information about manufacturing practices, ingredient sourcing, the company’s sustainability efforts and more. Most shoppers believe that disclosure of these details is a key indicator of transparency, which is critical to earning their trust and loyalty.
Notably, respondents were not necessarily buyers of natural products, which are known to highly value transparency from manufacturers and retailers. However, the fact that the average U.S. consumer feels so strongly about transparency means that natural brands and retailers must continue to share their stories and detail the attributes of their products, and do so across multiple channels.
“The data in this report reinforces the old adage that honesty is the best policy”, said Steve Markenson, director of research and insights at FMI.
Consumers want to know where their food comes from and how it is made, and this has held true even as the pandemic has changed grocery shopping habits. Whether online or in-store, shoppers prefer brands that tell the whole story about their products.Steve Markenson, FMI Research Director.
Omnichannel is the new way forward
As widely reported, the pandemic has accelerated grocery e-commerce by at least five years. According to the FMI and Nielsen survey, 55% of current consumers have shopped for groceries online in the past 30 days, up from just 26% in 2018. Among those who currently shop for groceries online, 64% did not start doing so until early 2020, and 43% specified the pandemic as the reason for their switch.
But shoppers are not abandoning physical stores. Despite the sharp rise in e-commerce, 45% of respondents said they make as many in-person visits to the grocery store today as they did before the pandemic began. Another 44% said they do more shopping at brick-and-mortar grocery stores now than before the pandemic. This could imply that as the pandemic has prompted people to eat healthier and cook more at home, more consumers are shopping at the grocery store today (or shopping more frequently), either in-store, online, or, most likely, a combination of both.
In any case, as grocery shopping is becoming omnichannel, both brands and retailers must meet consumer demands both in-store and online, especially when it comes to transparency.
What shoppers want to know
The FMI and NielsenIQ survey defined transparency for respondents as “the provision of detailed information, for example, about what is in food and how it was made”. When asked how much transparency mattered to them, 72% of shoppers said it was important or extremely important when deciding which food brands and retailers to support. For 78% of those consumers, their desire to be informed is tied to the health and well-being of their families, while 69% said it is linked to environmental concerns.
The survey also shows that transparency often translates into trust, which in turn builds loyalty. Some 79% of respondents said that when manufacturers and retailers share complete and easy-to-understand definitions of ingredients, they are more likely to trust those companies. Similarly, 79% say they tend to be more loyal to brands that provide more detailed information than what appears on product packaging. In fact, 64% would switch from a brand they normally buy to one that shared those details.