Specialty foods strike millennials' fancy

by Monica Watrous
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Consumers are spending a higher share of food dollars on high-end items than last year.


NEW YORK — Driving the specialty food segment are millennials, who spend more money than older consumers on such products as high-end chocolate, olive oil and cheese, according to the Specialty Food Association and Mintel International.

Specialty foods are defined as products of premium quality that may be made by small or local manufacturers, feature ethnic flavors, or contain the best available ingredients. Fifty-nine per cent of U.S. consumers purchased specialty food products in the past six months, compared with 74% in 2013. The difference may be a matter of redefinition rather than a decline in purchases, however, as previously niche foods such as Greek yogurt move into the mainstream. Mintel estimates an annual sales growth of nearly 8% this year for the segment.

In an on-line survey of 1,649 adults in June, Mintel found specialty food shoppers spend 25% of their food dollars on such products, up from 20% in 2013. The top foods purchased are chocolate (57% of consumers), olive oil (57%), cheese (54%) and tea (40%). Ethnic cuisine also is gaining favor, led by Italian (56%), Mexican (55%), Chinese (36%) and East Asian (32%).

“Overall, specialty food consumers have these foods and beverages on hand for regular usage, whether as an everyday snack or meal or as a treat," said Denise Purcell, senior director, content development for the Specialty Food Association. “This daily engagement bodes well for the market as a whole.”

While baby boomers are more likely to buy gourmet items for everyday cooking, younger adults purchase specialty food for snacks and on-the-go meals. Women are more likely than men to buy specialty food products, and the segment’s core consumer is aged 18-44 with an income of $75,000 or more.

Of those who buy specialty foods, 84% support companies that practice sustainability, 21% buy gluten-free products, and 17% purchase kosher or halal certified foods. Additionally, 24% of men and 33% of women who buy specialty foods look for products made without bioengineered ingredients.

The top factor influencing a specialty food shopper’s purchasing decision is taste, but the opportunity to try something new, impulse or referral from family and friends also are important drivers.

Supermarkets are the top destination for 66% of specialty food shoppers, followed by natural food stores (36%), mass merchandisers (35%), farmers markets (26%) and club stores (24%).
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