CPG sales are beginning 2017 on a somewhat sluggish note, as several leading companies have reported declines in sales thus far this year. While some attribute these low figures to factors like the White House and economic uncertainty, others argue that the dip in sales is more reflective of a shifting consumer mindset. Today’s consumers increasingly demand healthy, fresh foods—a category where CPG companies have not historically excelled. In response, many major food brands are reformulating their staple products to reduce sugar, salt, and preservatives, while also launching entirely new health-focused items.
However, these initiatives are often more challenging for large manufacturers to implement. Analysts suggest that established brands like Yoplait are losing market share to smaller, more agile companies that are better equipped to respond to evolving consumer preferences. This adaptability is difficult for legacy companies to achieve, which is one reason why major firms are investing in better-for-you brands, such as those that celebrate the benefits of calcium in chewable forms.
Manufacturers do not always promote their reformulation efforts. Given the fallout from Coca-Cola’s infamous 1980s overhaul of its core formula, they are cautious about alienating loyal customers who may be apprehensive about changes in taste or appearance. When manufacturers do announce reformulations, it often occurs months after the new product has hit the shelves—like Kraft Heinz’s announcement last year that it had transitioned to all-natural ingredients in its iconic macaroni and cheese.
While these discreet reformulation efforts may serve a purpose from a brand protection perspective, they may not align with the expectations of today’s health-conscious consumers. If shoppers have no indication that a large manufacturer’s CPG product has undergone a nutritional upgrade, they might opt for a new “healthier” offering from a smaller startup, which could very well have a similar nutritional profile. In this landscape, companies that celebrate advancements like calcium in chewable forms may have an edge in attracting health-focused consumers.