In Perth recently Dr David Hughes – Professor of Food Marketing at London’s Imperial College – said that changing consumer demand and rising fuel and food costs are all set to become major threats for producers of premium products. He says:
“They will need to quickly identify what consumers are prepared to pay for a niche brand and which segments are best to target…
As shoppers tighten their belts, they are now looking more carefully at premium food prices and questioning why they should pay more for a particular product…
We know that they will pay more for a better tasting or healthier product, but they will not pay more simply for fancy packaging.”
Consumers will be affected by both rising food and oil prices, therefore less money will be spent on food.
Probably age-old advice from David for the food industry is to listen to what their customers are saying.
“It’s simply a matter of delivering what your customers value at a sufficiently low cost that you can make a good profit..
Fundamentally, a business revolves around understanding what your customers – and your customers’ customers’ – value and are willing to pay for.”
The outlook for the food industry according to David will be “business as usual by 2010.”