How food companies like Coke and Kraft-Heinz are targeting low-income Americans | Reuters
In recent times, the economic landscape for low-income Americans has shifted dramatically, leading to significant changes in consumer behavior and corporate strategy. As the cost of living continues to rise, those relying on government benefits like SNAP (Supplemental Nutrition Assistance Program) and WIC (Women, Infants, and Children) are finding it increasingly difficult to afford basic necessities, including food. This shift has prompted major food manufacturers such as Kraft-Heinz and Conagra Brands to rethink their product lines and marketing strategies to cater to a demographic that is cutting back on spending.
The impact of reduced government assistance and the high cost of living is evident in the sales volumes of packaged foods and drinks, which have seen a decline. Consumers with limited budgets are opting to cook from scratch, use leftovers more efficiently, or simply purchase less. This trend is particularly pronounced among households earning roughly less than $35,000 per year, a significant portion of which includes Black American households. The reduction in SNAP benefits, as highlighted by Dollar Tree CEO Richard Dreiling, is expected to be a major headwind for retailers and food manufacturers alike.
In response to these challenges, companies are introducing more affordable products and increasing promotions to attract price-sensitive consumers. For instance, Conagra plans to launch new Banquet chicken patties priced at $6.99 for six, aiming to offer an affordable alternative to fast food. Similarly, Hershey and PepsiCo are adjusting their product sizes and marketing strategies to offer better value for money, while Kraft Heinz and other food companies are ramping up discounts to draw in consumers looking for bargains.
The shift towards value-oriented products and promotions marks a significant departure from the premium-focused strategies that many of these companies adopted during the pandemic. This change underscores the need for businesses to adapt to the evolving economic conditions and consumer preferences. As low-income consumers continue to face financial stress, their purchasing decisions are increasingly influenced by the need for affordable, filling, and nutritious food options.
This situation presents a complex challenge for food manufacturers and retailers, who must balance the need to maintain profitability with the imperative to serve a demographic under increasing economic pressure. The strategies they adopt in response to this challenge will likely have long-term implications for their brand image, customer loyalty, and market position.
[read more]
Rising Dough
Considering the economic pressures on low-income consumers and the strategies employed by food manufacturers and retailers to cater to their needs, what are the potential implications for the broader economy and society if these trends continue?
*Click on the “Full Loaf” icon to read the full article! After you read the full article, let us know your thoughts.
☕️ **Discover Stone Street Coffee Company – Your Coffee Haven!**
Today’s Dough readers, if you’re on the hunt for exceptional coffee and cold brew, look no further than Stone Street Coffee Company. We at Today’s Dough are smitten with their rich coffee blends and refreshing Cold Brew. Stone Street’s commitment to quality shines through in every sip. Now, exclusively for our readers, click the banner above to snag a $5 off coupon on your next order. Experience the finest, ethically sourced beans roasted to perfection. Join the Stone Street community, savor top-notch coffee, and elevate your daily brew. ☕️🌟
Share this content:
