Australia: Cost of living and evolving global consumer demands
After peaking at 9.4% year-on-year change in the third quarter of 2022, global headline inflation is expected to decline to 4.2% in 2025 and to 3.6% in 2026, according to the International Monetary Fund. However, based on the IPSOS Predictions 2025 report, results consumer outlook for the economy remains relatively unchanged, and optimism for the year ahead has yet to return to pre-COVID levels.
Fast evolving minds of consumers
Each year, MLA conducts a Global Consumer Tracker, which is a study across our key export markets looking at the behaviours, attitudes, and different topical themes among target consumers. The 2024 results found that two in three of the global consumers have changed the way they purchase imported red meat, including:
Opportunities exist in finding the right cut for the right shopper. Pre-prepared red meat options, including pre-marinated meat, are convenient for shoppers looking to save time in the kitchen but also excite and inspire shoppers to try new flavours. Lamb chops and cutlets (which is perceived as more approachable than a lamb roast) may attract shoppers less familiar with lamb to purchase, highlighting the importance of having a range of cuts to suit different budgets and shopper needs.
MLA’s Global Consumer Tracker also found that while the key drivers of everyday protein purchase are enjoyment and functional factors like cost, ease of preparation and availability across most markets, environmental sustainability has grown from being important in just a few markets in 2020, to being important in most markets in 2023. This demonstrates how important sustainability is becoming for consumers as part of the product offering.
When it comes to drivers of ‘willingness to pay more’ for proteins, emotional factors like superiority, taste and enjoyment are the key drivers in consumers’ minds. ‘Tenderness’ (which aligns with eating quality) shifted to become more important in most markets in 2023. In this environment of inflationary pressures, global consumers are becoming increasingly demanding of their purchases, seeking a balance of value and a high-quality eating experience. Given the quality credentials and MSA grading standards, Australian red meat is at an advantageous position among competitors in a global market.
Delivering ‘value’ to consumers in the US
Shifts in spending behaviour have seen global consumers cutting back on dining out, however, not all segments across foodservice are performing equally.
Despite reduced foodservice spending in the US, fast-casual chain stores CAVA, Chipotle and Sweetgreen, have all seen double-digit growth in 2024. While these three chains are not the lowest priced options, what they have in common is their emphasis on healthy offerings in a more upscale environment compared to the typical fast-food chains, showcasing other forms of ‘value’ consumers are seeking.
Similarly in US retail, the grassfed beef segment has grown over 30% in value and volume sales in 2024 (albeit from a small base). While this is due to a combination of increased product in-store, and the narrowing price gap between grassfed beef and conventional beef an important factor is that consumers consider grassfed beef to be healthier and more sustainable than conventional beef. This means to consumers, grassfed beef brings more ‘value’.
Keeping a pulse on key export markets will enable Australian red meat to innovate and adapt to meet evolving consumer demands for quality, sustainability and ‘value’ in a challenging economic landscape.
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