TODAY’S

SPECIALTY FOOD
CONSUMER
2016
 TODAY’S SPECIALTY FOOD CONSUMER
SPECIALTY FOODS ARE GROWING in both
awareness and purchases, with nearly 60 percent
of consumers saying they have bought a special-
ty food or beverage in the past six months,
according to this year’s “Today’s Specialty Food
Consumer” report, compiled by the Specialty
Food Association and Mintel. That number is
up considerably from 47 percent in
2015. More consumers said this year
that they are aware of the term
specialty food itself and more
reported understanding what the
term means, two factors that are
likely driving the increase in
purchases.
Though specialty foods are sold in
many different kinds of retail channels,
nearly half of specialty food consum-
ers say they’d like to see greater availability of
these products in the stores they frequent, a
desire which bodes well for the industry.
Younger consumers remain the core specialty
food customer. Those between the ages of 25
and 44 are the most likely purchasers of specialty
food, followed closely by even younger custom-
ers ages 18 to 24. The millennial generation
comprises the bulk of this group, in
addition to the emerging Generation Z
or iGeneration, those born between
1995 and 2007 and who are just
beginning to come of age. Gen Xers
and baby boomers (ages 40 to 70)
are also engaged specialty food
consumers and some of the differences
in their purchasing habits and attitudes
are examined on the following pages.

THE CORE
MEN
62%
WOMEN
58%
SPECIALTY FOOD INCOME
CONSUMER: $150K+ 85%
GENDER K EY D E MOGR A P HI CS $100K–$149.9K 74%
$75K–$99.9K 67%

GEOGRAPHIC REGIONS
NEW GENERATION KEY
Age groups noted throughout
PACIFIC: ENGLAND: this research are defined
71% 61% as follows:
25–44 MIDWEST: iGeneration: 21 and under
52% Millennials: 22-39
MID
Generation X: 40-51
ATLANTIC
AGES SOUTH:
57% 62% Baby Boomers: 52-70
Swing Generation: +71
MOUNTAIN:
66%

ABOUT THE RESEARCH

This research is based on an online questionnaire
conducted by Mintel to explore consumption of and
attitudes and behaviors toward specialty foods. Mintel
and the Specialty Food Association were responsible
for the survey design, data analysis, and reporting.
Fieldwork was conducted in July among a sample of
2,155 adults aged 18+ with internet access. Mintel
selects survey respondents to be proportionally
balanced to the U.S. adult population based on key
demographics of gender, age, household income, and region.

Illustrations: Peter and Maria Hoey

C2 TODAY’S SPECIALTY FOOD CONSUMER 2016

 SEVEN INSIGHTS FROM THIS YEAR’S REPORT
HERE ARE SOME DISCOVERIES about the purchasing behaviors, habits, and attitudes
of today’s specialty food consumers that can help retailers and producers better posi-
tion and grow their businesses.
Parental influence. The core millennial consumers are
starting families, positioning parents to be a new key
demographic. Though not tabulated in this year’s
report, respondents indicate that being a parent is a
driver for increased specialty food consumption. Close
to half (48 percent) of food dollars spent by parents is
on specialty food. They buy across specialty food
categories, but particularly in child-friendly ones like
baking mixes, candy, pasta, and salty snacks.
Parents are also big online shoppers, and
about half say they are using or
looking for an online grocery
delivery service.
Prioritizing health.
In the past two years,
specialty food consumers
have been more likely to
cite dietary or health
reasons as drivers to try
specialty foods. This shift
indicates how well the
industry has incorporated
better-for-you products with
decadent foods and beverages.
The market for nutritionally superi-
or food, healthier takes on familiar
foods, and functionally enhanced products
will grow, even in non-traditional catego-
ries like chocolate.
The powerful male shopper. Last year was
the first time men surpassed women as the
more likely to buy specialty foods, and the
gap widened in 2016. Male influence in food
decisions is up: men now account for 43
percent of primary shoppers and 46 percent report
helping with meal preparation. Men have emerged as a
significant consumer group to reach.
Conversion opportunities. According to this year’s
report, 40 percent of consumers don’t purchase special-
ty foods though, of these, 54 percent say they know
what specialty products are. This translates into 22
percent of consumers who may be good targets to try to
convert. Even consumers who are designated as “light”
buyers, still buy specialty foods, especially treats like
cookies, frozen desserts, and chocolate. Retailers could
draw them in by merchandising indulgences, which
often act as gateway products to further purchases.
Online takes off. This year’s respondents were more
likely than ever to say they’ve made specialty food
purchases online. Millennials are the most
likely to shop for specialty foods
online: 75 percent of respondents
report doing so, followed closely
by Gen Xers. The convenience
and savings of e-commerce
both draw in consumers
earning $25K to $50K,
much less affluent than the
typical specialty food
consumer. As online shop-
ping becomes the norm, it
opens an avenue to reach
new consumer groups.
Shifting shopping channels.
Beyond burgeoning online sales,
other non-traditional stores are becom-
ing go-tos for specialty foods. This move-
ment is largely driven by millennials, who are
not loyal to a particular retailer and will shop
in the widest array of stores. Specialty food
sales in club stores, convenience stores, mass
merchandisers, department stores, home
stores, and gift stores are all growing as a
result, as these stores begin to carry larger
sets of specialty products.
Education craving. Even consumers who do the heavi-
est specialty food purchasing would benefit from more
guidance. Fewer than half say it is easy to identify
specialty foods in the stores where they shop. Educa-
tion, shelf signage, and staff knowledge could be an
opportunity to garner even more sales from the
biggest shoppers.
TODAY’S SPECIALTY FOOD CONSUMER 2016 C3
MILLENNIALS
Millennials make up the bulk of the core special-
ty food consumer group. They purchase special-
ty foods in the largest
WHO BUYS number of categories. These
SPECIALTY shoppers buy a lot of snacks
FOODS? and treats but, based on
their high incidence of
purchasing items like meat, poultry, and
seafood, and seasonings and spices, they are
doing some at-home cooking too. Respondents
reported that they use specialty foods both for
everyday meals and indulgences. They also use
specialty foods for the largest array of reasons,
to enjoy personally or to share with others.
Millennials shop for specialty foods through ATTITUDES AND HABITS: KEY OPPORTUNITIES
an assortment of retailers. These products are a
part of their lives and this convenience-oriented Merchandising: This group buys specialty foods to share
group expects to find these foods wherever they with others. They like to entertain and plan parties for
are shopping. family and friends and they look for products to help them
impress guests.
How Millennials Use Specialty Foods: Product Development: Millennials are the most adventurous
Everyday meals or snacking; treats; gifts; with their diets: 80 percent report trying an alternative diet
to serve guests; for special occasions; to like high protein or low sugar.
share at the office. Positioning: To millennials, a company’s values matter just
as much as the products they make. But the position
Most Likely to Shop at: companies espouse must be genuine; this group is suspi-
Natural food stores; mass merchants; cious of marketing ploys.
club stores; specialty food stores; online;
Marketing: Restaurants and retailers need to have a social-
convenience stores; department stores;
media presence across platforms to connect with millenni-
and other outlets.
als. They are the most likely generation to use social media
Purchase Drivers: to talk/learn about food and places where they can eat or
Impulse; convenience; social or shop.
environmental concerns; to entertain Service: Millennials report that they would like retail staff
or impress. to educate them about specialty foods. They are also
the most likely consumer group to ask about recipes or
preparation techniques.

GENERATION X
Nearly two-thirds of Gen Xers report buying
specialty foods. These consumers use specialty
foods daily, in equal amounts for meals and
treats. They do seek out convenience during meal
preparation and will turn to
WHO BUYS kits or packaged sauces.
SPECIALTY Gen Xers, who are bet-
FOODS? ween the ages of 40 and 51,
are becoming more health-
focused as they age. They are the most likely
consumer group to look for quality ingredients on
packaging and they are the most likely to shop
for fresh foods at farmers markets.

C4 TODAY’S SPECIALTY FOOD CONSUMER 2016

 ATTITUDES AND HABITS: KEY OPPORTUNITIES
Merchandising: Gen Xers are the most likely consumer
group to make a purchase based on sampling a
product in store.
Product Development: Convenience matters to Gen
Xers: They are the most likely to cook or prepare a meal
from a quick option like a meal kit or pasta sauce.
They also seek out specialty foods to use as ingredients
to improve prepared or takeout foods.
Positioning: As they enter their 40s and 50s, Gen Xers
are health conscious and look for brands that provide
quality, clean ingredients. They are the group who most
believes GMOs should never be used in food
and beverage products.
Marketing: Gen Xers report frequently using apps
to find or use store coupons or restaurant discounts.
Service: Personal connections with retailers are import-
ant to Gen Xers. They like to hear the story
or heritage behind the stores where they shop and they
like to shop where they know the owners.

How Gen Xers Use Specialty Foods: Most Likely to Shop at: Purchase Drivers:
Everyday meals and snacking; to treat Farmers markets Health; recommen-
themselves; special occasions dations from others

BABY BOOMERS
Boomers are an experiential and experimental
group. They use specialty foods the most of all
groups for cooking at home. They do a lot of
scratch cooking and enjoy trying new things. ATTITUDES AND HABITS: KEY OPPORTUNITIES
They consider themselves knowledgeable about Merchandising: Boomers Positioning: Boomers like
food, and excitement and a like to cook and don’t seem to shop where they agree
WHO BUYS desire for new experiences driven by shortcuts or with the company values
SPECIALTY drive their specialty food convenience. Ingredients or philosophy.
FOODS? purchases. and recipes for scratch Marketing: Product claims
While excitement may cooking go over well like locally sourced,
be front burner, health and social consciousness with this group. non-GMO, gluten-free, fair
also plays into purchasing decisions with this Product Development: trade, ethical, and sustain-
group. Boomers, now between the ages of 52 Boomers report wanting able are purchase drivers
and 70, are taking their health seriously and to eat healthfully and steer with this group.
report eating more natural and healthy foods clear of artificial ingredi- Service: Boomers like to
such as those with fewer artificial ingredients or ents but they still want shop where employees are
preservatives. They are also the most likely exciting and different knowledgeable about the
consumer group to purchase products that claim tastes. products.
to be fair trade, ethical, or sustainable.

How Boomers Use Specialty Foods: Most Likely to Shop at: Purchase Drivers:
Everyday meals; treats Supermarkets Excitement and health

TODAY’S SPECIALTY FOOD CONSUMER 2016 C5

 WHAT DO SPECIALTY FOOD CONSUMERS BUY?
In 2015 there were six categories that had at least 25
percent of specialty food consumers saying they’d
made purchases in the past six months. This year that
number has increased to 10 categories, seven in food
and three in beverages. Perennial favorites cheese and
chocolate remain in the top three categories, as does
frozen desserts, driven by dairy as well as non-dairy
alternative products.

MILLENNIALS ARE
TOP 10 MOST-PURCHASED CATEGORIES FREQUENT PURCHASERS OF:
2016
Meat, poultry, and seafood Nuts, seeds, and
Cheese and cheese alternatives Beverages: dried fruit
33% Cereal
Meals, frozen
alcoholic or chilled
and Oils and
Ice cream and frozen desserts vinegars
32% nonalcoholic;
coffee;
tea
Chocolate 31% Salsas
Pasta and dips
Coffee, coffee substitutes, and cocoa 29% and
pizza
sauces Seasonings,
Oils and vinegars 29% spices,
Salty and
snacks spice
Cookies, brownies, cakes, and pies 28% rubs
Yogurt
and kefir
Pasta 28%
Ice cream and frozen desserts; chocolate and
Pasta and pizza sauces 26% non-chocolate candy; cookies, brownies, cakes, and pies

Beverages—non-alcoholic 25% GEN-XERS ARE

(e.g., juice, soft drinks, water)
FREQUENT PURCHASERS OF:
Cooking
Tea (packaged) 25% sauces
Source: Mintel Snack and
bars and marinades
energy
bars Appetizers
and
TOP GROWING CATEGORIES Spreads antipasti
and
2015 2016 dessert
sauces Condiments
Beverages—non-alcoholic 20% 25% and
(e.g., juice, soft drinks, water)
dressings
Candy (non-chocolate) 13% 17%

Cereal (hot, cold, granola, museli) 19% 23% BOOMERS ARE

FREQUENT PURCHASERS OF:
Meals (frozen, chilled) 16% 20% Cheese and Condiments
cheese and
Pasta alternatives dressings
24% 28%
Pasta
Pasta and pizza sauces 22% 26% Grains,
beans, and
Snack rice
Appetizers and antipasti 15% 18% bars and
(pickles, peppers, olives) energy
bars
Beverages—alcoholic 16% 19% Oils and
vinegars
Condiments and dressings 16% 19%
Source: Mintel

C6 TODAY’S SPECIALTY FOOD CONSUMER 2016

 CHANNELS WHERE SPECIALTY FOOD

WHERE DO CONSUMERS SHOP

2015 2016
SPECIALTY FOOD Supermarket 67% 58%
CONSUMERS SHOP? Natural food store (e.g., Whole Foods, Trader Joe’s) 44%
Mass merchandiser (e.g., Walmart, Target) 35%
40%
36%
Supermarkets, natural food stores, and mass merchants Farmers market 33% 31%
were the top three channels where consumers Club store (e.g., Costco, Sam’s Club, BJ’s Wholesale) 29%
27%
purchased specialty foods in 2016. But sales dipped
Specialty food store 26% 25%
slightly or stayed stable in all of those while rising in
Online 12% 16%
assorted untraditional channels. Club stores, online
Stand-alone bakery (not in a grocery store) 17% 16%
shopping, convenience stores, department stores,
home stores, and gifts stores all saw an increasing Convenience store 11% 15%
number of shoppers buying specialty foods. Department store 9% 12%
Home store (e.g., Bed, Bath & Beyond, Cost Plus) 8% 12%
Wine or liquor store 11% 12%
SPECIALTY FOOD AND DRINK CATEGORIES Gift store 4% 9%
PURCHASED ONLINE Other 1% 2%
2015 2016
None of the above 0% 3%
Coffee, coffee substitutes, and cocoa 53% 59%
Tea (packaged) 10% 11%
Chocolate 9% 11%
Oils and vinegars 10% 10%
Pasta and pizza sauces 6% 9%
Cookies, brownies, cakes, and pies 8% 9%
Nuts, seeds, and dried fruit and vegetables 8% 8%
Pasta 5% 8%
Seasonings, spices, and spice rubs 8% 8%
Snack bars and energy bars 7% 8%

DIGITAL AND DELIVERY: KEY OPPORTUNITIES

Apps and delivery services for groceries or meal ingredi-
ents are going to be more important in the coming years.
The core specialty food consumers are already using or
seeking these solutions, and they will be the norm among
even younger consumers as they reach adulthood.
Apps: Usage is up overall to:
• purchase groceries
• find or use store coupons or manufacturer coupons
• check for recipes
• scan products in store to compare prices or
learn about allergens or nutritional levels
Delivery services: More than one-third of respondents
are actively looking for an online grocery delivery service.
Millennials are the most likely to be seeking these
services, followed by Gen Xers. Overall, 15 percent of
respondents already use apps from food delivery services
like Blue Apron.
Online payments: Millennials are frequently using apps
like Google Wallet to pay for food or meals at markets or
restaurants.

TODAY’S SPECIALTY FOOD CONSUMER 2016 C7


HOW MUCH DO
SPECIALTY FOOD
CONSUMERS SPEND?
Specialty food consumers spend considerably more
on food they prepare at home or eat in restaurants
compared to their non–specialty–food consumer
counterparts. Non–specialty–food consumers spend
a mean of $93 per week on food at home versus
$113 for specialty food consumers, and $40 per
week to eat in restaurants, nearly half of the $77
spent weekly by specialty food consumers.
THE LESS AFFLUENT
SPECIALTY FOOD CONSUMER:
KEY OPPORTUNITIES
With younger people representing the core shopper, it
stands to reason that they may be earning less than
the $100K+ annual salary key demographic of the
specialty food consumer. Consumers earning consider-
ably less are still making these foods and beverages
part of their daily lives. (See box, right.)
Specialty food consumers purchase in an average of
7.2 categories. That number hits eight categories
among the most affluent consumers earning between
$100K and $150K+ annually. However, consumers who
earn less still shop in a significant number of catego-
ries. Groups on both ends of the income spectrum
report they’d like to see more specialty foods for sale
at the stores where they shop.
Focus on Snacking, Indulgence
and Convenience
Certain categories are a draw to less affluent shoppers,
who will spend on specialty foods for snacking or to
enjoy as treats. Chocolate, cakes, salty snacks, and
cheese are just some categories where these shoppers
spend their most dollars.
Other products like pasta or pizza sauces or cooking
sauces and marinades do well as they offer conve-
nience in meal preparation. Retailers can draw in these
groups by featuring snacks, treats, and convenience
items and cross merchandising them with related foods
and beverages for further purchase potential.
C8 TODAY’S SPECIALTY FOOD CONSUMER 2016
MEAN WEEKLY SPENDING ON FOOD
FOR SPECIALTY FOOD CONSUMERS
OVERALL
Cook/prepare at home: $113 From restaurants: $77
MILLENNIALS
Cook/prepare at home: $118 From restaurants: $95
GEN XERS
Cook/prepare at home: $104 From restaurants: $62
BABY BOOMERS
Cook/prepare at home: $109 From restaurants: $56
THE LESS AFFLUENT
SPECIALTY FOOD CONSUMER
• Uses specialty foods for everything from treats
to everyday snacking.
• Purchase drivers: New experiences; the desire to eat
more healthfully; impulse; convenience; interesting
packaging; and recommendations from friends.
• Consumers earning under $25K - $74.9K annually:
Buy in an average of 6.5 categories
What they buy: Cheese; ice cream; chocolate; coffee;
oils and vinegars; cookies, brownies, cakes, and pies;
pasta and pizza sauces; pasta; tea; meat, poultry,
and seafood.
• Consumers earning $75K - $99.9K annually:
Buy in an average of 7.9 categories
What they buy: oils and vinegars; cookies, brownies,
cakes, and pies; pasta; non-alcoholic beverages; meat,
poultry, and seafood; salty snacks; cereal; salsas and
dips; frozen or chilled meals; cooking sauces and
marinades; grains, beans, and rice.
Attend our webinar
Today’s Specialty Food Consumer
Tuesday, Oct. 4, 1-2 p.m. EDT
Written by Denise Purcell, editor of Specialty Food
Magazine; research led by Ian Au, brand specialist for
the Specialty Food Association.