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More BFY Means More Sales Growth

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Mainstream retailers have steadily increased their selection of better-for-you foods over the years, and according to a new study they shouldn’t slow down anytime soon.

From the report, which written by the nonprofit Hudson Institute and gleaned from Nielsen sales data: “Food and beverage companies that have a higher percentage of product sales in the BFY category perform better financially.” Good nutrition, in other words, makes for good business.

greencart.jpgFood companies have known for a long time now that offering better-for-you products is part of a solid business plan. But perhaps, judging from this study, they underestimate just how big a role this segment should play. According to the study, between 2007 and 2011 better-for-you foods comprised just under 40% of total sales yet produced more than 70% of the total sales growth. That’s more than double the growth of traditional foods, which showed sales growth of 28.2%.

For a long time, retailer’s commitment to healthful products seemed grudging, at best. Well okay, if we have to was the common attitude coming from buyers and executives used to making their money off of soda, steaks and potato chips. In recent years many have become believers, mixing healthful, functional alternatives into popular categories.

The commitment is definitely there, but the game continues to evolve in increasingly sophisticated ways. Consumers now question what “better-for-you” means in many products. Something may be low in calories, but what about the sodium count? Does it contain high-fructose corn syrup? And so on. We’ve all heard of greenwashing and other accusations of placing marketing above health.

Indeed, what this study doesn’t reflect is this ongoing examination of what exactly better-for-you means and how that might impact sales. As examples of better-for-you foods, the authors use products like Lean Cuisine, Campbell’s Tomato Soup and Coca-Cola Zero. These items might technically fall under this category, but I can tell you many shoppers would question whether, in fact, they are better for you.

So while healthy products are an engine for growth right now, their future success hinges on constantly examining their value and making sure they deliver on the promises they make.

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