For example, changes in consumer behavior due to the pandemic are resulting in sales gaps as large as 10-15% between competitors. Factors include select category growth, out-of-stocks, e-commerce and grocery gains, new buyers, increased basket sizes, and a drop in total store UPC counts. Of course, e-commerce, grocery and value channels are seeing increases; and IRI expects e-commerce will continue to gain post-pandemic. Furthermore, value channels will become more important as recessionary behavior takes hold.
IRI points out that most brands attracted 30-40% new buyers during the pandemic due to shifting behaviors and limited product availability. Business closures have impacted purchasing patterns, too. With drycleaners closed, for example, there has been an increase in laundry care product sales. In addition, with a second pandemic wave predicted for later in the year, IRI suggests there may be another round of stockpiling and greater CPG consumption. On the flip side, traditional demand spikes for holidays, vacations and celebratory events have been subdued as gatherings are scaled back or tabled.
IRI notes that while trends including better-for-you snacking, multifunctional beverages, on-the-go protein, simple and transparent, premium and natural self-care and Hispanic-focused offerings are here to stay, other trends are shifting:
- 2019 growth drivers included surgical price increases; in 2020, overall value must be reinforced.
- In 2019, innovation was baked into acquisitions. Now, new acquisition opportunities exist.
- Commitment to e-commerce is intensifying due to adoption. There is an opportunity to gain new buyers and retain lapsed buyers in 2020.