As U.S. consumers cope with the third year of an economic downturn, which can now be best described as a jobless recovery, an interesting trend has emerged. Consumers have re-calibrated spending and redefined the traditional norms of value. During the recession, value was about consumers trading down and making sacrifices. Today, it is increasingly about consumers weighing not only the costs of goods, but the multitude of benefits they offer as well. A great example is the dynamic that has occurred within the yogurt category. Despite the 121% higher average equivalized price of Greek yogurt compared to non-Greek yogurt, sales continue to sky rocket. Over the past 52 weeks ending October 2, 2010, Greek yogurt dollar and unit sales are up 160% and 203% respectively, while non-Greek yogurt dollar and unit sales are up 3% and 1%. Clearly, the consumer is making a statement with their wallet, and according to buzz data, benefits beyond price are driving factors.
Buzz about Greek yogurt suggests something of a triple threat. The category appeals to consumers to satisfy three core needs: health, convenience and taste. In online conversations, consumers focus more on the health benefits (using attributes like “fresh” and “better”) and the rich and creamy texture. Dieters, health seekers and athletes recommend eating Greek yogurt across all meal occasions – particularly as a satisfying on-the-go or evening snack. Underscoring its multifaceted appeal, cooks claim to opt for Greek yogurt as a more nutritious base for homemade salad dressings and mayonnaise. Remarkably, apart from a relatively small subset of total category buzz related to deals and coupons, most of the conversation deals not with price but instead with the benefits of Greek yogurt.
As consumers continue to redefine value and repair their balance sheets, retailers and manufacturers can look to solutions that drive sales beyond price alone. Connecting with consumers’ “need states” requires a critical review to determine the factors driving behavior. In the case of Greek yogurt sales, the healthy benefits of the more expensive variety justify the higher cost in the minds of consumers. And while controlled spending in the tough economy is the new norm, there are some things that consumers will not sacrifice at any price – and health is likely one of them.