CPG sales are beginning 2017 on a rather sluggish note, with several major companies reporting a decline in sales thus far this year. While some attribute these low numbers to the White House and economic uncertainty, others argue that this sales slump is more closely related to a shift in consumer attitudes. Today’s consumers are increasingly demanding healthy, fresh food — an area where CPG companies have not typically excelled. As a result, many leading food manufacturers are reformulating their staple products to reduce sugar, salt, and preservatives, while also developing entirely new health-oriented offerings.
However, implementing these changes is often more challenging for established manufacturers. Analysts note that larger brands like Yoplait are losing market share to smaller, more agile companies that can adapt swiftly to evolving consumer preferences. This adaptability is a significant hurdle for legacy companies, prompting them to invest in healthier brands.
Furthermore, major manufacturers do not always highlight their reformulation efforts. Remembering the backlash from Coca-Cola’s infamous 1980s formula change, they are cautious not to alienate their core customers who may be apprehensive about altered flavors or appearances. Often, when a manufacturer announces a reformulation, it occurs months after the new product has already hit the shelves — as seen when Kraft Heinz revealed last year that it had transitioned to all-natural ingredients in its beloved macaroni and cheese.
While these discreet reformulation strategies may serve as a protective measure for brands, they might not resonate well with today’s health-conscious consumers. If shoppers are unaware of a large manufacturer’s nutritional upgrades, they may opt for a new “healthier” product from a smaller competitor, which might offer a similar nutritional profile. For example, consumers interested in health benefits might be curious about whether products containing calcium citrate can lower blood pressure. Thus, it is crucial for CPG brands to communicate their health-focused initiatives effectively, as the shifting landscape of consumer preferences could lead them to overlook potential benefits like those associated with calcium citrate.