The clock is ticking for businesses to adapt and keep pace with their consumers, amidst rising prices and behaviours changing more rapidly than ever before.
A more cost-effective route to consumer insight, than other more expensive and traditional methods
Written by Sam Gilding, Sales and Marketing Director
The cost of inflation is at a 30-year high, having risen to 7% in March.
Prices are rising faster than wages and the cost of living will only continue to increase now that the energy price cap has been adjusted.
Outside of the energy crisis, the war in Ukraine is starting to impact food and drink businesses from several different categories. Ukraine produces 10% of the world’s wheat, as well as being one of the top exporters of barley and sunflower seeds.
The U.N expects the drop in Ukraine’s grain exports could increase international food and feed prices by between 8% and 22% above current levels, which are already inflated. UK consumers are already starting to feel the pinch, with commodities like vegetable oil and sunflower oil increasing by over 23% in March alone. These prices are expected to rise further over the coming months.
Many food and drink manufacturing businesses are impacted by these rising input costs, which are squeezing margins across the board. In a lot of cases, margins cannot be sustained without passing on some of the cost to the consumer, who face soaring fuel bills and a wider cost of living crisis. In many ways, a dark storm for the food and drink industry to try and weather, together with their consumers.
What are we likely to see happen?
Consumer behaviour will change and adapt more quickly than ever before, with any notion of brand or shopper loyalty playing second fiddle to a more primal, yet promiscuous exploration of bricks and mortar retailers (mults and discounters) and online agents. We can expect to see ingredients continue to become more expensive, like the impact of a large stone in a placid pool. The price of rapeseed oil is already on the move, as businesses consider other viable alternatives to remain competitive in the market space. We can expect to see consumers more open to trying new flavours and cooking styles, if the price is right.
What will the impact be on innovation and product development more generally? How can businesses expect to get it right? Whilst at the same time, can they afford to get it wrong?
We are entering a time, whereby no amount of market experience, nor industry years can adequately help to judge what the consumer is going to do next. It’s unprecedented. And therein lies the rub.
Vypr produces robust forward-looking consumer data in real-time, which helps product development processes to run leaner, greener and more successfully. At a time when validating your product decisions and keeping pace with the consumer has never been more important, why not see if we can help you?
Find out how Vypr can help you by contacting our friendly team.