Wonder White, Cottee’s: Food staples on the nose with health-conscious Australians

AUGUST 12, 2014
News.com.au

THE quinoa crusade marches on as the humble white loaf becomes a supermarket pariah. Grocery buyers are shunning the traditional supermarket staples like canned food and cordial in favour of fresher, healthier alternatives.
A survey of main grocery buyers by market research company BrandHook has put soft drinks, white bread and sugar at the top of the list of items shoppers are buying less of.
Dips, chips, chocolate biscuits and canned food also saw the red pen in favour of the foods such as bananas, yoghurt, apples, nuts, eggs, chicken and oats.
The survey found health, diet and cost were the top three reasons for the change. BrandHook founder Pip Stocks said it was no surprise to see Australians dropping sugary, fatty foods from their shopping carts.
“One of the key trends we saw early this year was the consumers wanting brands to ‘do the work for me’, which ranges from making it simple and convenient and making it good value,” said Ms Stocks.
“The big disconnect with this insight is that we are the fattest nation in the developing world with the prevalence of obesity doubling in the last 20 years. Although consumers think they are being healthier, something else outside of the supermarket is preventing us from being really healthy.”
FORMER STAPLES ON THE NOSE
1. SOFT DRINKS
As the favoured target of public health crusaders, it’s not surprising soft drinks come top of the list of no-nos for survey respondents.
In its 2013 annual report, bottling company Coca-Cola Amatil Australia reported a 3.2 per cent decrease in sales volume in its non-alcoholic beverages business. Notably, CCA reported a 9 per cent increase in sales volume for bottled water brand Mount Franklin and a 10 per cent increase in Pump water.
Looking at the soft drink category as a whole, however, overall spend has increased as people move to often pricier energy drinks and low-sugar varieties. Today the average household spends $330 on soft drinks a year, compared with $276 five years ago, according to research company IBISWorld.
“Growth in soft drink spend has been driven by the increasing popularity of energy drinks and zero- and low-sugar varieties,” said Ryan Lin, IBISWorld senior industry analyst. “High-sugar soft drinks have become less popular over the past five years, limiting growth in this category.”
2. WHITE BREAD
Wholemeal, rye, linseed — anything but the dreaded loaf of white bread, say today’s carb-cutting consumers. The days of rosy-faced children happily munching on fluffy white sandwiches in bread commercials appear all but over.
Overall spend has remained steady, but healthier varieties are muscling in, meaning a smaller slice for the fairy bread staple.
Goodman Fielder, maker of Wonder White, was forced to raise its prices this year after a $65 million half-year loss — although this was partly as a result of increased wheat prices due to drought conditions in parts of Queensland and NSW.
According to IBISWorld, the average household today spends $365 on bread each year — about the same amount as five years ago. “Bread is a staple household product, hence the fairly stagnant consumer spend over the past five years,” Mr Lin said.
“White bread and roll sales account for an estimated 45 per cent of total bread spend. This portion has fallen over the past five years, as consumers have turned to healthier alternatives, such as mixed grain and rye bread.”
Sugar consumption is on a long-term downward trend across the globe.
3. SUGAR
According to Tom McNeil, director of market analyst Green Pool Commodities, sugar consumption has been on a long-term downward trend since the 1950s — from about 57kg per capita in 1951 to about 42kg per capita in 2011.
“There’s certainly been a health kick against sugar,” Mr McNeil said. “There’s been a massive anti-fructose movement in the US, and poor science has been applied to sucrose as well. It’s probably not surprising that in developed countries generally sugar consumption per capita has been falling.”
Despite the long-term downward trend, however, actual consumer spending on sugar over the past five years has increased by more than 11 per cent as a result of rising prices following the Queensland floods. The average household now spends $35 on sugar each year, according to IBISWorld.
“Consumer spend on sugar has increased dramatically over the past five years, due to rising prices and steady demand,” Mr Lin said. “As sugar is a staple household product, consumers were forced to accept these price hikes. Since then, growth in sugar prices and consumer spend has eased.”
4. CORDIAL
It’s not just soft drinks feeling the waistline pinch. According to market analysts Euromonitor International, the kitchen-table staple, cordial, has been one of the hardest hit categories by the health revolution.
Euromonitor International research analyst Emily Cox said next to bottled water, ready-to-drink tea was one of the biggest beneficiaries of the shift from sugar, with consumption rising from 1.66L per capita in 2012 to 1.76L per capita in 2013.
“However, liquid concentrate — cordial — has been one of the hardest hit due to the perception that it is a sugar-laden product with a lack of functional benefits, declining from 5.46L per capita in 2012 to 5.24L per capita in 2013,” Ms Cox said.
She said while consumption of juice has also been in decline, from 29.65L per capita in 2012 to 28.8L per capita in 2013, this was largely due to the booming juice bar market. “Australia is experiencing a green smoothie craze at the moment following the growing popularity of the product among celebrities and those riding in the wellness wave.”
Millions of peaches? Not for much longer.
5. CANNED FOODS
The canned goods industry has been in decline for some time, as the recent woes of SPC Ardmona highlighted. And it’s not just tinned peaches longing for the golden era — the days of spaghetti on toast may also be numbered.
In the BrandHook survey, respondents said they were cutting down on canned fruit and canned soups, opting for fresh versions of both. “Our main grocery buyers are now recognising the value of buying fresh ingredients they can incorporate into their own meal solutions,” Ms Stocks said.
This is backed up by Nielsen data, which shows canned meals, baked beans and spaghetti all in decline — in the year to July 2014, total sales of baked beans and spaghetti were down 4.3 per cent to $154.28 million, while canned meals dropped five per cent to $55.65 million in the same period.
Spread thin: Jam struggling to compete with Nutella and honey.
6. JAM
It’s not just our social lives falling victim to our hectic lifestyles — Australians no longer have time for a sit-down breakfast, according to Euromonitor International senior research analyst Daniel Grimsey.
“They have no time for toast. And this means they have no time for jam, the consumption of which fell by 4 per cent in volume in 2013,” Mr Grimsey said. “While other spreads are doing fine — you can put peanut butter in your curries, honey in your porridge, and Nutella in everything — there is little else you can do with jam but put it on your toast.”
The result is that per capita volume sales of jam have been in decline for a decade, from 1.26kg per capita in 2004 down to 1.11kg per capita in 2014.
7. MACCA’S
Global sales for the fast-food chain fell by 2.5 per cent in the second quarter of 2014, with the division encompassing Asia Pacific, Middle East and Africa posting the biggest decline of 7.3 per cent.
Australia was singled out as second only to Japan as a poor performer by McDonald’s chief executive Don Thompson. “Looking forward, McDonald’s is focused on stabilising key priority markets including the US, Germany, Australia and Japan,” Mr Thompson said.