Foodnavigator-usa Podcast

Supply chain snags, consumer stockpiling and retailers reprioritizing what to stock during the initial phases of the coronavirus pandemic meant many consumers had to go without their favorite brands and switch to available alternatives, but according to one branding expert, those lost sales are not the same as lost consumers.

Even before the threat of the “quarantine 15” – or the idea that some Americans are at risk of packing on 15 pounds during the pandemic due to stress-baking, mindless snacking and reduced physical activity – the rate of obesity in America has been stubbornly rising, creating a challenge and opportunity for the food and beverage industry.

While consumer interest in where food comes from and how it is produced has been growing in recent years, an organic industry leader says the coronavirus pandemic has turbocharged shoppers’ interest in local, organic and sustainably produced products as well as alternative distribution channels.

Once relegated to the dusty back corners of kitchen cupboards or quickly swigged by only the most devote health-conscious consumers, apple cider vinegar has been thrust into the limelight by the coronavirus pandemic for its claimed immunity, beauty-enhancing and cleaning benefits.

While some food and beverage brands have enjoyed tremendous growth following the coronavirus outbreak, others have been completely "pummeled" by government and consumer response to the virus – revealing a division that could provide a road map for the rest of the pandemic and potential economic downturn that will follow.

As measures designed to flatten the curve of the coronavirus pandemic continue to flatten the economy simultaneously, many companies are making tough decisions to survive, including whether to pull-back on expansion plans, lay off employees, rationalize SKU production, or push forward with strategies laid out pre-COVID-19 with hopes for a speedy economic recovery.

As the infection rate and death toll of the novel coronavirus continue to climb, more Americans are re-thinking their diet to help ward off infection, as illustrated by the dramatic increase in sales of immunity products and people buying them in the US.

Even as packaged food and beverage companies scramble to meet increased consumer demand while also compensating for setbacks during the ongoing coronavirus pandemic, many are shifting already limited resources to employees, customers in need and the broader community.

Americans are drinking more coffee than ever before – and not just because fears of coronavirus are keeping them up at night or because they suddenly need an energy boost as they navigate new demands that strain work-life balance.

Given the perils of visiting brick and mortar grocery stores amid the ongoing coronavirus pandemic, many shoppers have turned to online shopping en mass – revealing gaping holes in many retailers’ approached to e-commerce that threaten profitability and consumer loyalty.

Recognizing that the threat of climate change weighs heavily on many consumers and increasingly influences their shopping habits, the consumer packaged goods industry is exploring how it can reduce the use of limited resources, minimize waste and, in some cases, improve the environment.

Before the threat of COVID-19 prompted Washington, DC, and other US cities to ban large gatherings, nearly 900 school nutritional professionals from across the country converged on the Nation’s capital to brainstorm how vulnerable children can continue to access breakfast and lunch in the event of widespread school closures due to the coronavirus.

Confronted almost daily with images of marine debris filling the bellies of dead whales, headlines about climate change and emerging stories about America’s broken recycling system, consumers increasingly are worried about single-use plastic and packaging waste and are pressuring government and the CPG industry to find solutions.

According to the NPD Group’s Future of Snacking report, Americans ate more than 386 billion snacks last year, and IRI reports the category brought in a whopping $89 billion dollars by the end of 2017 with an addition $16 billion in sales predicted over the next five years.

The consumer packaged goods industry may be composed of diverse companies offering disparate products ranging from toothpaste to pet food to canned soup, but a recent survey conducted by the Consumer Brands Association reveals 86% of CPG leaders place the consumer at the center of their worlds, and as such they share many of the same fears and challenges.

When demand for “clean label” first burst on the scene several years ago, it was all about removing “chemical-sounding,” “unnatural” and unnecessary ingredients from products, but as shoppers learn more about food, how it is made and its impact on their health, their expectations for what they consume have become more nuanced, and so, too, has industry’s approach to “clean label.”

The long-held consumer perception of convenience stores as a last resort for a fast in-and-out trip to grab a six-pack of beer and, if they weren’t too picky, a few staple ingredients, is quickly being replaced by a new class of elevated – and digitally-integrated – c-stores, such as Chicago-based Foxtrot.

The quickly emerging vertical or indoor farming sector often is touted for its environmental sustainability, but according to ongoing research conducted by one of player in the space, produce grown indoors also offers notable health benefits to people beyond those which are farmed outdoors.

As consumer interest in health, wellness and sustainability has lifted better-for-you brands out of the dark corners of stores to become a mainstream phenomenon in every category, marketers have gravitated to founders’ stories and social missions to attract the attention purpose-driven consumers.

The consumer-packaged goods industry is undergoing a “cataclysmic transformation,” according to one branding expert, who explained that a new crop of entrepreneurs who are unfettered by outdated taboos and not intimidated by industry giants are challenging iconic brands that once were considered untouchable – and winning.