COVID-19 invoked a collective emphasis on health and wellness among Americans, causing shoppers to pay more attention to the products that they’re putting into and on their bodies. The majority of shoppers consider health and wellness issues and needs when shopping, whether they’re looking for foods that fit new lifestyles, shopping for nontoxic products, or avoiding specific ingredients. This segment of the market is growing fast, and it is projected to grow almost 15% — from $175 billion to $203 billion — between now and 2023.
According to NielsenIQ’s recent “Health Shopper Survey,” 38% of households followed a special diet within the past six months, and 42% of households have allergies that affect the products they add to their shopping baskets. With such a large portion of the population seeking or avoiding specific ingredients and attributes, it’s surprising to learn that finding products that meet their needs is challenging both in-store and online. In fact, 95% of products that qualify for the most frequently searched attributes are missing in search results from the top 30 e-tailers selling grocery, drug, health and beauty, and pet products online. And, when looking at on-package data, 90% of products are missing from attribute-based site searches. Despite these disparities, some channels like traditional grocery and mass have high satisfaction rates when it comes to healthy food assortment, but channels like value grocery, specialty grocery and drug stores failed to satisfy over half of the population.
The pandemic-related boom in e-commerce introduced over 22 million new consumer packaged goods shoppers to the online channel, and e-commerce shoppers of all types became more reliant on online searches. When it comes to drug stores, the most common omnichannel purchasing influencers include replenish needs, promotions and in-stock availability — meaning drug store shoppers are prioritizing convenience to satisfy needs in a timely way. For drug retailers, on-the-go products make up a large portion of food sales, and those categories will regain their relevance as shoppers continue to reemerge from their homes and begin their post-vaccine lives. Drug stores can accommodate those who have allergies and follow special diets by expanding their healthy snack and beverage assortments and grouping on-shelf items by benefit (e.g., low sugar, keto friendly, etc.).
Shoppers aren’t searching for CPG items based on brand; they’re searching by attribute. In fact, according to a 2020 IBM and NRF research study, over 70% of shoppers are looking for specific attributes that are important to them when choosing a brand. Consumers are demanding more product transparency than ever before and want to know that the products they are purchasing will meet their needs.
The hidden issue that many retailers and manufacturers are encountering is their on-package claims and attribute search data does not holistically reflect all of the benefits a product actually provides. For example, a product that is marketed as “keto-friendly” could also qualify as low calorie, low carb, etc. — yet those attributes are not tagged to the product page or labeled on its packaging. In order to close the gaps on these missed opportunities, retailers and manufacturers need to expand their online search attributes and further develop their on-package product claims, respectively — which will also maximize shoppers’ perception of a wider assortment of health-centric products.
For over half of Americans, the most important food attributes include heart healthy, low sugar, high protein and low sodium. And 19% of households are treating various ailments through diets such as gluten free, heart healthy, etc. This “food as medicine” approach grew in popularity throughout the pandemic and is still influencing shoppers as they continue to prioritize their health and longevity amid the vaccine rollout.
Building on this sentiment of maintaining health, COVID-19 fueled a rise in the development of in-store retail clinics, and 18% of households visited an in-store clinic in the past six months as shoppers began to redefine drug stores as a health hub. Although the majority (62%) of households received vaccinations at in-store clinics, 3% households who visited an in-store clinic received diet counseling, presenting an opportunity to acquaint shoppers with the benefits associated with in-store clinics and redefine the drug channel as a health and wellness hub.
All in all, health and wellness is no longer a niche market, and consumers’ growing notion towards retailer and product transparency will continue to shape the CPG industry. As omnichannel shopping continues to accelerate, so will shoppers’ familiarity with searching for products by attribute or benefit both in-store and online.
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