Consumers may be willing to pay more for recognizable ingredients
Nearly three-quarters of consumers are happy to pay a higher retail price for a food or drink product made with ingredients they recognize and trust, according to new research commissioned by Ingredient Communications.
Nearly three-quarters of consumers are happy to pay a higher retail price for a food or drink product made with ingredients they recognize and trust, according to new research commissioned by Ingredient Communications. In a survey of 1,300 consumers across Europe, North America, and Asia-Pacific, more than half of respondents (52%) said they would spend 10% more on a food or drink product that contained ingredients they recognized and trusted. Meanwhile, 18% said they would pay 75% or more extra. In addition, overall, 76% of respondents said they would be more likely to buy a product that contained ingredients they recognized and trusted.
The findings of the survey underline the growing importance of clean and clear labeling and the use of ingredients that are familiar to consumers. They also suggest that there may be opportunity to harness the potential of co-branding between food and beverage manufacturers and their ingredients suppliers.
“Co-branding of ingredients in the food and beverage industry is still fairly unusual, and yet our survey suggests it would resonate with many consumers,” said Richard Clarke, director of Ingredient Communications. “Marketing finished products that contain ‘branded’ ingredients that consumers recognize could be key to commanding a substantial price premium in-store. One barrier to co-branding is a perception among food and beverage companies that it reduces their ability to shop around among suppliers of raw materials to achieve the best price. However, with consumers willing to pay such large price premiums for products made with ingredients they know, this factor might easily be offset by increased sales and profits.”