UK F&B report 2022

UK F&B report 2022

A trip to the supermarket is more expensive than ever. In this report, we analyse data from 1,000 working-age Brits to understand the impact that record-breaking inflation is having on grocery spend, alongside the changes in consumer behaviour that brands will need to navigate in the coming months.

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The findings at a glance

The impact of UK food inflation in numbers

Chapter 1

How inflation is affecting grocery spending

Of all the categories affected by inflation, food is one of the worst hit. In the UK, food inflation has risen 9.8% year-on-year. This is putting very real pressure on British consumers, 42.8% of whom were worried about affording food in our August Inflation Sentiment Tracker

To find out how this is altering grocery shopping habits, we surveyed 1,000 nationally representative working age Britons. First off, we found that the average weekly grocery spend has increased by over £8 due to inflation. While Brits were spending an average of £59.16 per week on groceries six months ago, they’re now spending £67.56.

However, shoppers are keeping a tight rein on their spending, with 42.3% sticking to a budget when they go to the supermarket. They’re also taking other actions to bring down their shopping bills, with ramifications for F&B brands, retailers, and the health of the nation. We’ll look at these now, but if you want to dig into the data for yourself and drill down into different demographics, you can do it in our interactive dashboard.

Buying cheaper, buying less

The primary behavioural change? Switching to cheaper brands. It’s something 54.2% of Brits say they’re doing (and we’ll explore the categories most likely to be affected in a moment). But it’s not just like-for-like switches shoppers are making; they’re also choosing cheaper foods (51.4%). And with less healthy foods often those likely to be the cheapest, these dietary changes could be a blow in the battle against obesity.

They could also put people at risk of malnutrition; 33.9% of our respondents are buying less food due to rising costs, with that figure jumping to 39.1% for people aged 35-44. This looks set to make a bad situation worse – nearly two million people in the UK are undernourished, according to The Food Foundation.

Finally, we see that nearly four in 10 shoppers are saving money by switching to cheaper shops. It’s only the fourth most common action that people are taking – surprising given that prices can vary widely between retailers. Research from the Consumers’ Association found that a basket containing 47 of the most popular groceries could vary in price by more than £25 depending on the shop. We’ll take a more detailed look at how inflation affects supermarket loyalty in the next chapter. 

How are Brits cutting back on grocery spend?

Premium foods bear the brunt

When it comes to buying less, Brits are cutting back in nearly every area. We found that consumers have reduced their purchasing in seven out of nine categories. The hardest hit is the premium/luxury foods segment, which sees a huge 70.3% net reduction. 

Alcohol also records a significant 56.8% net reduction, alongside convenience foods (42.2% net reduction) – could inflation present an unexpected health benefit? On the other hand, a net 17.5% of people are buying less fresh fruit and veg. 

Brits also say they are shopping less for non-food products: toiletries/cosmetics see a 31.2% net reduction, and cleaning/household products chalk up a 25.9% net reduction. Thanks to their long shelf lives, the smallest loss is seen in canned and pantry goods; a net 1.5% of consumers are shopping for them less.

But supermarket own brand products, and frozen food, are the only two categories to emerge with any credit. The former category actually sees an impressive net increase of 35.6% – reflective of the high number of people who say they are switching to cheaper brands – while frozen food records a much more modest 1.7% net increase. 

Chapter 2

What's happening to brand loyalty?

As we saw earlier, brand switching is the #1 way Brits are cutting back their grocery bills… but they’re more likely to consider switching in some categories than others.

Toilet roll is the most common substitution that people are making, with 44.4% saying they’ve switched to a cheaper brand in the last six months. It’s also a significant distance ahead of the next most popular switches, which are crisps/snacks (39.3%), cereal (37.1%), and biscuits/sweets (also 37.1%). 

At the other end of the scale, consumers are least likely to switch beer or spirit brands. Only 12.7% of people say they’ve started buying a cheaper brand in the last six months. Pet food also has reasonably high loyalty (just 14.1% have switched). 

Incidentally, brands won’t retain customers by putting up their prices. We found that UK consumers would rather brands reduce product size than increase product price. A number of F&B brands have been called out for this practice – known as ‘shrinkflation’ – but our data shows Brits are marginally in favour; 57.9% voted for maintaining prices.

Heritage brands enjoy the most loyalty

Just under a third (32.1%) of Brits told us they’d started buying a cheaper ketchup or mayonnaise brand in the last six months, while 29.4% said they’d been buying different tinned soup and/or baked beans. But despite this, respondents were most likely to name Heinz when asked if there was any F&B brand they intended to stay loyal to in the face of rising costs.

After Heinz (named by 150 respondents), soft drink and snack brands were the next names  on respondents’ lips. Coke/Coca-Cola was named by 59, followed by Pepsi (named by 28), Walkers (named by 24), and Cadburys (named by 18). An honourable mention goes to Yorkshire Tea, which was named by 17 respondents. 

In a separate piece of research (covering brands in general, not just F&B brands), we found that the length of time a consumer has been buying a particular brand plays a role in their loyalty to it. So it’s unsurprising that the brands named in our survey were all ones with considerable heritage. As inflation pushes more consumers to seek out cheaper alternatives, newer brands will have to try even harder to remain competitive.

In what categories are Brits switching to cheaper brands?

Discount retailers take market share

We know that people are more likely to switch products than they are to swap retailers, but 39.4% of consumers have changed where they shop in the last six months. And, of course, it’s the discount supermarkets that benefited from this shift. The number of Brits shopping at Aldi and Lidl has increased from 23.8% six months ago to 39.1% today.

Aldi is the retailer to win the most new customers, growing from 16.5% to 25.9%. At the other end of the scale, big names Tesco, Asda and Sainsburys have lost shoppers. Tesco falls from 27.5% to 22.4%, while Asda drops from 19.3% to 15.9% and Sainsburys from 10.8% to 7.2%.

Another trend to impact retailers is the post-pandemic return to brick and mortar shops and subsequent decline in online shopping. Our data shows a dramatic change in where people buy their groceries compared to last year. In January 2021, 30.9% of Brits shopped for groceries mostly or only online; today, that figure has dropped to 11.2%. Meanwhile the number of people who shop only in-store has more than doubled, rising from 21.8% to 45.8%. This means retailers may need to incentivise shoppers to go online, with special website-only deals and free delivery offers. 

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Chapter 3

Relaxing attitudes to expiration dates

Expiration dates lead to a lot of unnecessary food waste, with several supermarkets having discontinued these on a range of items in order to try and reduce wastage. But the rising cost of food is causing Brits to reconsider the (often arbitrary) dates on food packaging. 

Our data finds that 18.1% of people have recently started eating foods after their expiration date. Added to the 48.9% of consumers who’ve done this for a while, this means 67.0% of Brits – more than two-thirds – are now comfortable to make their own judgements about the freshness of goods.

A further 19.7% have recently started eating opened foods beyond the advised time (in addition to the 51.0% of people who already do this). Meanwhile, 52.6% of people say they will remove ‘bad bits’ from food so it can still be eaten. This includes 16.8% who’ve made this change recently, suggesting that inflation is leading people to reassess what’s safe to eat. 

Shoppers are also saving money by buying reduced price food that’s close to expiring; 50.4% have done this for a while, and a further 27.9% have just started. But while they might be happy to buy close-to-expiry products at a discount, when consumers are paying full price, they look for as long an expiry date as possible. A huge 91.8% of people say they check expiry dates prior to purchase to ensure a long life (including 21.5% who started doing this recently). This suggests removing expiration dates would help retailers reduce wastage of unsold products. 

Dry foods are most trusted

There’s little science behind expiration dates, yet our data shows we instinctively feel some foods are safer to eat beyond their expiration dates than others. We showed respondents a list of 11 foods and asked them which they would eat beyond their expiry date if they looked, smelled and tasted fine. 

The food most likely to be eaten is crisps/snacks (64.1%) followed by biscuits/sweets (60.4%) and cereal (54.2%). More than half (53.8%) said they would eat bread after it had expired but only 28.6% would consume milk past its expiration date. Least likely to be eaten after expiry are cooked meat (23.1%) and fresh meat (21.1%). 

Which foods will Brits eat past their expiry dates?

We’re still wasting food

Despite the belt-tightening happening across the UK, we’re still letting food go to waste. Our data shows that Brits throw away an average of 2.45 unconsumed/partially consumed groceries every week. 

Younger consumers are the worst culprits for food waste, while those in the 55-64 age range are especially good at minimising waste. Nearly 45% of people in this older age group say they don’t throw away any edible waste per week in comparison to 8.8% of those aged 18-24.

Interestingly, Gen Z are slightly more likely than other demographics to value expiration dates: 38.5% don’t eat food after it has expired, 36.1% won’t eat opened food beyond the advised time, and 24.4% won’t buy food that’s close to expiry. 

Perhaps we can conclude that those with more life experience, who understand how to identify what is and what isn’t safe to eat, are less likely to rely on expiration dates and subsequently waste less food. 

Chapter 4

Sustainability takes a backseat

Clearly, reduced food waste is a great thing, but apart from that, how does inflation affect the environment? We wanted to find out whether consumers care less about ‘being green’ when they’re trying to save money. To get a handle on this, we benchmarked today’s landscape against Attest data from January 2021.

First, we asked respondents to rank six factors according to how much they’re influenced by them when choosing food or drink brands. While we see that sustainability/ethics remains in fifth place, just below convenience and above packaging attractiveness/advertising, we do see an interesting shift in priorities. 

In 2021, price was chosen as the most important factor by 35.7% of respondents. This year, price is a much more emphatic winner, selected by 57.6% as their first priority when choosing food and drink brands. While quality/taste still ranked second overall last year, it was more highly valued: 33.1% rated it as the most important factor versus 22.5% this year.

The cost of food is by far the most important factor influencing a consumer’s purchase, while quality is considered much less important than it used to be. This in itself is a clear message that times have changed, and while consumers might support environmental initiatives, they’re unlikely to pay more for them.

Buying from green brands is less important

We find further evidence that Brits are becoming less environmentally conscious when we compare data on their buying behaviours. Significantly fewer are trying to buy from environmentally friendly brands when they go to the supermarket. While around three in 10  (29.9%) aimed to do this in 2021, that figure has fallen to 21.8%.

And despite the fact it should offer cost savings, buying unpackaged products and refills has fallen out of fashion: 35.2% of consumers were doing this in 2021 – now it’s only 28.5%. Brits are also less likely to try to buy locally produced products (down from 38.1% to 30.8%). 

The upside, however, is that shoppers are slightly more likely to buy seasonal products (up from 37% to 40.3%). Buying domestically grown, seasonal foods will always be cheaper than products imported from other countries. This is a strong message for retailers to push.

How green are British grocery shoppers?

Veganism is losing traction

When consumers are strapped for cash they can’t afford to be idealistic. So it figures that they might swap an organic carrot for a cheaper industrially-farmed one. But what perhaps doesn’t make sense is the increased meat consumption our data uncovers. Meat is expensive, yet we see a decline in plant-based diets and a six percentage point increase in Brits describing themselves as ‘meateaters’ (rising from 63.2% in 2021 to 69.2% in 2022).

Veganism seems to be on the decline; only 2.1% of people describe themselves as vegans (previously 3.3%). And while the number of vegetarians has grown from 5.3% to 6.4%, pesceterians have fallen from 4.9% to 3.6%. This means that only 12.1% of Brits classify themselves as non-meat eaters. 

The popularity of flexitarianism – where people mostly eat meat-free meals – has also gone down from 23.2% to 18.6%. And yet the market value of plant-based food in the UK has doubled between 2016 and 2020, and is forecast to continue growing through the next few years. Since there hasn’t been huge growth in people adopting meat-free diets, we can only conclude that this boom is down to more meat-eating Britons integrating plant-based foods into their diets. Either way, it seems rising costs aren’t enough to wean people off meat.  

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