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February 1st, 2011

Waist Not, Want Not

Obesity is a large and growing national problem.  Over the past few years, food manufacturers and retailers have been working on ways to reduce unhealthy ingredients in their products.  While it will take time and money to make food itself healthier, digital and social marketing technologies can help consumers make healthier food choices today.

In a move that garnered significant attention, Wal-Mart recently announced a new initiative to provide healthier food to its shoppers.  As part of its initiative, Wal-Mart set 5-year targets for reducing unhealthy salt, fat, and sugar in the packaged foods its sells.   Wal-Mart also said it plans to drop prices on fruits and vegetables to make them more affordable.  Although many large CPG companies have been working to make their products healthier, Wal-Mart’s size and scale will certainly bring more prominence to the issue.

The costs of obesity continue to grow.  According to recent research from McKinsey, the U.S. spends about $160 billion on obesity-related medical costs – a figure that has doubled over the last 10 years and could double again by 2018.  The direct costs are dwarfed by the indirect costs of obesity, which total $450 billion and include the $90 billion consumers spend annually on extra food.  Like it or not, food manufacturers and retailers are part of the obesity problem and must be part of the solution.

CPGs and retailers can provide enhanced health content and tools to help consumers make more informed choices regarding the food they eat.  Here are a few examples and ideas:

  • Meal planning.  One way to eat healthier is to cook at home.  Digital technologies can make it much easier to find recipes and coupons.  For example, General Mills recently launched an innovative meal-planning tool that allows consumers to find recipes, drag and drop them into a weekly meal plan, and then print the plan and a shopping list.
  • Food ratings and tools.  It can be hard to know if a food item is healthy for you by looking at its packaging.   Several new tools have been launched that provide product-level nutritional rating systems.  Fooducate, for example, provides a mobile app that allows shopper to scan a bar code, see the product’s health rating (based on a proprietary algorithm), and find healthier alternatives. Other systems already exist, some industry developed and some independent, including NuVal, Guiding Stars, and the just launched Nutrition Keys program.   One big opportunity for retailers is to integrate one or more of these nutritional ratings systems into online and mobile circulars, recipes, and coupons to provide better and easier to understand health information when shoppers need it most – when planning their trip or in the store making purchase decisions.
  • Personalized offers.  A number of brands and retailers already provide personalized offers based on shopping history.  One idea that could be powerful is to go behind what you buy and use a combination of health information and predictive modeling to recommend products you should buy and to provide targeted coupons or other incentives for purchasing them.  For example, if someone has hypertension, the tool could recommend snack foods that are low in salt and provide savings for the healthiest choices.

In light of the increasing costs of obesity, food manufacturers and retailers can make an impact both in longer term product formulas and shorter term initiatives that educate consumers in leading healthier lives.

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