Insights & Industry30/01/20
Insider’s view: Urbanization drives new trends and eating habits
In the past three decades Tomi Kuittinen, Head of Insight & Foresight at HKScan Oyj, has witnessed major societal, behavioural and structural changes. These changes cover both the business landscape on food production and consumption, as well as how we as consumers live our lives. Having worked at stock-listed companies and market leaders such as Fazer and Atria before, the understanding on behavioural drivers extends beyond product categories. This article is about what is happening in Finland; urbanization, trends, and their impact on our society and personal lives. Understanding the phenomena and what it means calls for insights.
Urbanization as a driver
In 1920, agriculture represented around 70% of the economic structure in Finland. Followed by strong and rapid stage of industrialization, we now live in a post-industrial service society in our country. The traditional agricultural products such as meat and grain are still available, next to new products such as meat imitating vegetarian products, cricket-based snacks and gluten-free pastas. This diversification is a consequence of several factors, and one of the major ones is urbanization.
“First of all, let’s clarify what is “a driver” and what is “a trend”. I think many things are mistakenly called as trends, while they are drivers that consequently launch new trends. For example, urbanization is a driver that has generated a variety of new trends, either directly or indirectly”, opens Kuittinen. “New trends shape our society, the ways how we live our lives, and also the way how the market reacts to respond to the changing demand. In general, I think urbanization is a driver everyone is aware of, but only some of us have profoundly internalized how huge the impact will be on us. Urbanization and its consequences will catch most of us off guard”, Kuittinen underlines.
For Kuittinen, climate change is partially linked to urbanization. However, while climate change gets huge attention in media, urbanization is considered as a “normal continuum” of societal change. This, according to Kuittinen, is problematic if the impact of urbanization is not fully understood. Let’s examine this further.
Trends triggered by urbanization
For any company, understanding the market required understanding the customer. Consequently, this requires insights to understand the context of people’s lives.
“In the recent years the size of our households has decreased significantly. In 2018, the average household size in Finland was 1,99 people, and the birth rate is at its lowest level since 1868. Simultaneously, Helsinki alone is estimated to receive 100 000 new citizens by 2030, which represents the increase of over 13% in the city’s population”, Kuittinen characterizes. “In the big picture, I believe that people’s need to own an own home will decrease, and rental arrangements will become more common. Smaller households will mean smaller kitchens. Coupling this with the busy lifestyle characteristic to city folks may result in weakening cooking skills”, Kuittinen ponders.
However, the thoughts above are only part of the puzzle. People’s average lifespan will increase, and for many time will become more important factor than money. “Also, people’s awareness on health, wellbeing and food will continue to increase, which results in more diverse meals and diets”, Kuittinen comments. “This will be a common trend, and while people’s average income levels will increase across the board, also income gaps will get steeper”, Kuittinen summarizes. “The general consumption will increase, there will be shortage of manpower in certain sectors requiring basic manual labour, and working hours will also change, depending on the sector and industry”, Kuittinen forecasts. When thinking how trends converge and interlink it is easy to pose a vital question: “What would change the way we eat more profoundly than urbanization?”
Trends on cooking, eating and health
Awareness, time, health, well-being and food. The growing interest and trends around this area will evolve and diversify further in the future. “Identifying, understanding and segmenting the contexts and situations when and how people eat will become even more important”, Kuittinen claims. “Eating out will become more common, and people will also spend more money when eating out. Moreover, the “types” or ways of eating out will take several forms, of which food companies and restaurants need to stay tuned with. Fine dining, eating lightly, protein balance, and pre-planned sessions with unhealthy food; people will plan all these moments”, Kuittinen affirms. Needless to say, the broadening range of consumer needs puts significant pressure on the food production chain, not only on restaurants.
Also, the above-mentioned factors will give birth to new “mini sales seasons”, according to Kuittinen. While Finnish consumers have adopted a variety of new themes and celebrations from abroad, such as Black Friday, Halloween, Valentine’s Day, and Day of the Dead, this trend will continue. This further diversifies food consumption, not to mention what it means in a larger social context. “We Finns will continue to celebrate Vappu and Juhannus, but thanks to growing awareness and interest in new cultural influences, we will adopt new things that will enrich our lives. As a food company we need to be conscious of this to serve the needs in the market”, Kuittinen comments.
“Through the eyes of a foods company professional, the trends driven by urbanization will lead to the growing importance of brands and the value they represent to consumers. The demand for domestic quality ingredients and products will also grow stronger. This is positive and promising development for the Finnish food production and consumer brands”, Kuittinen outlines.
Insights that make the difference
Drivers generate trends, and new trends come and go. The pace on how new things surge intensifies every day. Consequently, this reduces the time to react for companies; you either lead the change or follow it. Leaders skim the cream while followers suffer a dent on their sales and also on their image.
“Crowst is the perfect insights service for us, enabling us to feel the insights pulse of those people and segments we want, when we want, on those locations we want.”
In the past 3 years Crowst and HKScan have collaborated closely on consumer insights, covering behavioural, product concepting and in-store elements. “The old ways of conducting consumer research does not help us to stay on top of our market. Instead of lead-times measured in weeks or even months, we need to be able to talk about days or even hours. Sourcing insights needs to happen as a pulse, reflecting how the market evolves and how we live our lives”, Kuittinen points out. “Crowst is the perfect insights service for us, enabling us to feel the insights pulse of those people and segments we want, when we want, on those locations we want”, Kuittinen concludes. “Agility, modern service platform and the expertise of the Crowst folks; this package helps us to stay ahead of competition and make the right business decisions on the fly when needed”, Kuittinen closes. You can read about our collaboration more here.
Tired of outdated and expensive research methods? Call or send me an email, we have the cure at Crowst.