Dive Brief:

• Hy-Vee will remove more than 200 artificial ingredients and chemicals from 1,000 store brand products by next July, according to a company release. 
• Among the banned ingredients are partially hydrogenated oils, artificial colors and high fructose corn syrup. Once a product is free of these ingredients, it will receive a “Clean Honest Ingredients” label. Several products have already received this label, including Hy-Vee brand ketchup, tortilla chips and bottled tea.  
• “As the demand increases for food products that contain natural, familiar and simple ingredients, we are doing our best to meet those expectations within our Hy-Vee label offerings,” Jeremy Gosch, Hy-Vee’s executive vice president strategy and chief merchandising officer, said in the release.

Dive Insight:

With this initiative, Hy-Vee taps into the clean label trend that’s becoming increasingly popular with consumers. According to 2017’s Market LOHAS Health & Natural Consumer Study, eight out of ten health-minded consumers look for products that contain fewer, and pronounceable, ingredients in the products they buy. These LOHAS — or lifestyle of health and sustainability — shoppers make up about 22% of all consumers, but research shows demand for clean labels has seeped into the mainstream as well. A recent survey by Sanford Bernstein found 55% of respondents saying they are growing more distrustful of the food system, while 69% of consumers say that reading labels impacts their shopping habits, according to C+R Research.

Many national brand products have phased out artificial ingredients and preservatives, and have cut down on the unpronounceable names populating their ingredients lists. Cereal makers like General Mills have substituted natural compounds like turmeric and annatto in place of artificial colors and flavors in their products. This ovement is growing in soups, frozen meals, snacks and desserts as well. Unilever’s Häagen Dazs brand, for example, has seen generous returns on marketing efforts centered on the brands small ingredients lists.

Retailers have also begun reformulating their private label selections around simpler, more natural ingredients. Several years ago, Tops Friendly Markets began renovating its more than 2,000 products across four lines. The goal: to improve packaging and simplify ingredients lists. Its first relaunch was a clean label whipped cream, and grew to include everything from preservative-free frozen pizza to fruit spreads and applesauce made without high fructose corn syrup. Tops completed the renovation in March, and hopes it will help boost the company’s lagging sales.

Similarly, Hy-Vee wants to keep up with consumer demand. Its clean label initiative also breathes life into a center store segment that’s losing shoppers to fresh departments. The grocer no doubt hopes value pricing coupled with updated ingredients lists will bring people back to soups, frozen meals, cereals and other struggling categories.

This also amounts to yet another health-focused initiative for a retailer that staffs a dietitian in every store, offers health clinics, weight-management programs, healthy cooking classes, and just announced plans to build a store with a gym inside it. In a competitive grocery market where it pays to stand out, Hy-Vee is betting on health — a gamble that has paid off so far.