Consumer products companies need to rethink the way they approach health: survey

By Muneerah Bee

Consumer preferences on different product attributes vary in very specific ways across product categories, geographic regions, age groups and at stages of the value chain, according to a study of the consumer products industry entitled Cracking the code on consumers’ health-and-wellness preferences by global consulting firm AlixPartners.

The firm surveyed consumers in China, the US, Germany, France, and the UK to evaluate what consumers respond to in terms of product attributes at the segment and category levels. AlixPartners’ analysis revealed that when deciding business strategies manufacturers must know their consumers’ preferences and pay attention to these differences.

The preferences of consumers are different depending on which product segment, country, value chain stage and demographic group is being targeted. The company said this cannot be predicted and must be discovered.

“Soaring demand for ‘better-for-you products’ has pushed competition in the health and wellness market to new heights,” said David Garfield, managing director and global co-lead, Consumer Products at AlixPartners. “To capture—and defend—market share, it’s critical that consumer products players understand what consumers really want, which attributes they are willing to pay for, and how their preferences differ by country.” Garfield added: “It’s also essential for companies to understand whether consumers care more about ingredients, the manufacturing process, packaging, or other stages in the value chain in order to make the right strategic investments.”

Looking at the most significant regional variations of consumer preferences, when it comes to price, Chinese consumers are more concerned about the benefits of eating healthy and are willing to pay more for desirable attributes. The greatest barrier for Chinese consumers to purchasing is availability of products and confusion over whether these products are good for you.

Similarly, French consumers are willing to pay more for products with clean/healthy attributes. On the other hand, 73% of US consumers said price is a big barrier when it comes to healthy products.

The survey also showed that consumers around the globe want “less unhealthy” at varying stages in the supply chain. Additionally, having a healthy lifestyle is increasing in importance due to global health issues, food quality concerns and environmental pressures.

“With growing global concern about food sources and sustainability, and millennials placing a higher importance on all things healthy, the desire for healthy products may be less of a trend and more of an indicator of the future,” said Michael McCool, managing director, APAC Consumer and Retail at AlixPartners. “By understanding patterns in consumers’ preferences at these more granular levels, companies stand the best chance of crafting the right strategies for the future.” McCool added: “Furthermore, companies will need to adjust their marketing strategies across all product categories to be more education-focused, as consumers are demanding more transparency and genuine authenticity in identifying the quality of ingredients.”

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