Download - PART 1 - THE CHANGING SHAPE OF THE CPG …...2020/04/24 · *Based on IRI benchmarks, reaching new buyers through advertising within 4 weeks of their initial purchase results in an

April 24, 2020

PART 1 – THE CHANGING SHAPE OF THE CPG DEMAND CURVE

COVID-19 Impact on CPG Retail

© 2020 Information Resources Inc. (IRI). Confidential and Proprietary. 2

Anticipate the Future

Iconic brands are realizing new buyers, as consumers seek

more meal solutions, alternatives to out-of-stocks as well as

bargains. A sizeable opportunity exists for marketers to

retain new buyers by engaging them with empathetic and

informative messages that build lasting connections.

Increased in-home consumption is here to stay for the

foreseeable future. Households with children will continue

to make greater contributions to CPG sales growth, as

families will serve more meals at home through the summer.

Manufacturers should continue to focus on grocery and

dollar channels, which are winning in brick and mortar trips

and sales. Grocery is especially strong in food and beverage

trips and has an opportunity to increase high-value

nonedible purchases, as consumers seek to fulfill all their

shopping needs in one visit. Dollar channel is making gains in

total store, a sign that recessionary behaviors are emerging.

E-commerce will continue to gain significant share-of-wallet post-

COVID-19, as evidenced by European countries ahead of the

U.S. curve. Retailers should continue to inves in fulfillment

solutions, particularly to support click and collect.

With Easter as an example, summer holiday spending will

remain muted to accommodate small-group celebrations.

Retailers and their manufacturer partners should promote

DIY beauty, especially for nail and hair. Help support consumers

to transition the glamour of prom, graduation and other occasions

to video-chat platforms. Sales of beauty services will be slow to

resume, particularly in a down economy.

Grocery retail will capture more than its normal share of

beauty sales, as consumers seek to limit store visits and as

specialty retailers’ doors remain closed.

Warmer weather and a return to “the Sunday drive” as

consumers making socially appropriate outings, will give

Convenience and Gas a much-needed boost.


The Shape of the CPG Demand Curve Continues to Evolve; Industry

Needs to React Quickly as the Country Seeks to Reopen the Economy

$484BSmall Business Relief Package

ADDITIONAL

Filed for Unemployment in the Last 4 Weeks

26MM Americans

Source: https://coronavirus.jhu.edu/map.html and https://thehill.com

>860,000U.S. COVID-19 Cases~46,000+ deaths in the U.S.

*

CO, FL, GA, ID, MS, OH, SC,TN, TX, UT

States Dropping Stay-at-Home Orders

Short-Term CPG Demand Curve Scenarios

Long-Term GDP Scenarios

Shape of CPG Demand Evolving Rapidly

Virus Effectively Contained Another Virus Spike in the Fall

CPG Consumption –

Monthly YoY GrowthCPG Consumption –

Monthly YoY Growth

Swift Economic Recovery Slower Economic Recovery

U.S. GDP U.S. GDP

Continuous Slow Recovery Severe Economic Recession

U.S. GDP U.S. GDP


This Issue of IRI’s COVID-19 Report

Explores How CPG Demand is Changing

To Create This Report, IRI Leveraged Data and Analytics from Various Proprietary

Retail, Market, Consumer and Shopper Assets, Including:

• IRI Point of Sale Data, including Daily Chain POS Data

• Shopper Basket Analysis from IRI Consumer Network™ Panel

and Weekly Consumer Panel Solutions

• IRI Weekly Pulse Surveys

• IRI Multi Outlet, Total Store Fresh Model

• The New IRI CPG Demand Index

The Bright Side of Beauty

COVID-19 Routines Impact

CPG Demand

Brands Rethink Consumer

Engagement

Evolving Adoption of E-Commerce

Visit IRI’s COVID-19 Insights Portal and

COVID-19 Dashboard for more reports and updates.

https://advantage.iriworldwide.com/Engineering/covid19/index.html

https://www.iriworldwide.com/en-US/Insights/Publications/coronavirus-impact-to-CPG-and-retail



Executive Summary

COVID-19 Routines

Impact CPG Demand

Overall CPG dollar demand is

leveling off, but the grocery

channel is retaining a much

larger than normal share of the

food dollar. Pantry stocking trips

remain high. Trips and basket

sizes in the dollar channel are

up significantly in both food and

beverage and nonedibles.

Brands Rethink

Shopper Engagement

Brands and retailers should

communicate, inform and

support shoppers during this

crisis. To retain new buyers,

marketers should quickly act

with targeted messages, in-

store marketing and

promotional activities.

Evolving Adoption

of E-Commerce

E-commerce continues to gain

new users in the U.S., despite

consumer frustration with fees.

European countries are also

seeing increasing adoption of

e-commerce, which bodes well

for this channel in a post-

COVID-19 world.

The Bright Side

of Beauty

The grocery channel is

capturing a greater share

of beauty sales; DIY nails,

hair care dominate.


Long-Term Value of Retaining a

Fraction of New Consumers

Hundreds of Millions of Dollars of

Revenue Per Year

Brands Across Categories Have Acquired New and

Reacquired Lapsed Buyers in the Past Few Weeks

As Consumers Go Back to Iconic Brands in Stay-at-Home Phase, Marketers

Must Determine the Best Way to Retain These Buyers for the Long Haul

*Based on IRI benchmarks, reaching new buyers through advertising within 4 weeks of their initial purchase results in an average of 12.6% of those trial buyers becoming repeatersSource: IRI Loyalty database, IRI Consumer Panel. 12 weeks ending April 12, 2020

New Buyers Gained

4MM New Buyers Gained by National Frozen Entrée Brand

6.7MM New Buyers Gained by Dominant Soup Brand

0.6MM Net New Buyers Acquired by Major Brewer

4MM

11.6MM

20MM

New Buyers Attracted by Major Paper Goods Company

New Buyers Acquired by Personal Care Brand

New Buyers Acquired by Iconic Boxed Pasta Company


Marketers Are Rethinking How They Engage With

Consumers Due to Both Sensitivity and Economics

“We've determined that in this initial phase there is limited effectiveness to broad-

based brand marketing… We've reduced our direct consumer communication. We'll

pause sizable marketing campaigns through the early stages of the crisis and

reengage when the timing is right.”

James Quincey, Chairman & CEOThe Coca-Cola Company

“There’s big upside here in terms of reminding consumers of the benefits that they’ve experienced on our brands and how they’ve served their and their families’ needs, which is why this is not a time to go off air. We are doubling down and moving forward, not backwards. This is not a time to retrench.”

Jon Moeller - Vice Chairman, CFO and COO, Procter & Gamble

Source: Earnings calls transcripts, 2020.


Consumer Engagement is Always Valuable, But

Must Be Executed with Empathy and Relevance

Lessons from Recessions

Advertising, Merchandising,

In-store Promotional Activities

• Target new buyers by providing the

communication experience consumers

want. Deliver empathetic, comforting and

informative content to create stronger

connections and increase buyer loyalty

and long-term sales.

• Develop media and merchandising

strategies for at-risk and lost loyal buyers

with targeted messages, in-store

marketing and promotional activities.

90

100

110

120

130

140

150

160

170

1990 1991 1992 1993 1994 1995

+78%

157

132

Brands That Maintained Ad Spend in the

1990-1991 Recession Grew 78% vs. Peers*

Maintained/Increased SpendingCut Spending

Sa

les In

de

x

*Based on IRI benchmarks, reaching new buyers through advertising within 4 weeks of their initial purchase results in an average of 12.6% of those trial buyers becoming repeaters.


In the U.S., E-Commerce Gains Will Stick in a Post-COVID-19 World; Consumers Increasingly Buy into Click & Collect

• After stay-at-home restrictions end, 40% using curbside pickup more often plan to get 50% or more of their groceries this way

• Nearly 1/3 of those ordering groceries for home delivery more often plan to get half or more of their groceries this way

• The cost of online convenience is much more of a concern for those increasing their use of home delivery than for those opting for curbside pickup

− 27% say home delivery product prices are higher than they would

normally be willing to pay vs. 15% for curbside pickup

− 16% say shipping fees are more than they would normally be

willing to pay vs. 7% for curbside service fees

• European countries ahead of the U.S. COVID-19 curve demonstrate continued growth of e-commerce

Source: IRI Consumer Survey fielded among Primary Grocery Shoppers in the National Consumer Panel, March 13 – April 19, 2020.

13%buying more groceries

online for home delivery

14%using curbside

pick-up more often


View from Europe: In Spain, Consumers Shopped In-Store and

Online to Load Pantries, But Have Increased Use of E-Commerce

CPG E-Commerce Sales % Change vs. Year Ago

6747,988

80,110

166,831

10.9%

-1.9%

79.0%

10.8% 8.9% 10.5%

49.1%

20.3%

3.5%

54.1%

32.6%

51.3%

75.6%

-10

0

10

20

30

40

50

60

70

80

90

16-Feb 23-Feb 8-Mar1-Mar 15-Mar 22-Mar 29-Mar 5-Apr

2 2 84

131,646

12-Apr

-5.1%

4.0%6.7%

28,768

84.3%

22.4%

Note: eCommerce includes Brick & mortar retailers that deliver online orders to customer homes and Amazon.

E-Com %

share of total1.9% 1.9% 2.1% 2.2% 1.6% 2.1% 2.5% 3.1% 2.8%

In Store

E-commerce

COVID-19 Cases

Spain

Source: IRI Data Ending April 12, 2020. Worldometer as of April 20, 2020


View from Europe: E-Commerce Makes Gains,

Click & Collect Significantly Higher in Italy


88% 94%69%

119%

82%

357%

277%

433%

550% 539%

473%

687%

-100%

-50%

0%

50%

100%

150%

200%

250%

300%

350%

400%

450%

500%

550%

600%

650%

700%

2-

Apr

18-

Feb

17-

Feb

1

22-

Mar

19-

Feb

18-

Mar

4-

Mar

28-

Mar

59

22-

Feb

167%

20-

Feb

23-

Feb

101%

24-

Feb

25-

Feb

26-

Feb

206%

41

182%

23-

Mar

1

27-

Feb

29-

Mar

52%

9-

Mar

30-

Mar

17-

Mar

28-

Feb

26-

Mar

16-

Mar

29-

Feb

1-

Mar

3-

Mar

2-

Mar

5-

Mar

10-

Mar

6-

Mar

114%

7-

Mar

1-

Apr

14-

Mar

11-

Mar

31-

Mar

1

12-

Mar

210%

7-

Apr

13-

Mar

15-

Mar

19-

Mar

20-

Mar

139%

175%

21-

Mar

107%

24-

Mar

129

25-

Mar

168%

4-

Apr

27-

Mar

373%

32

3-

Apr

5-

Apr

6-

Apr

8-

Apr

9-

Apr

10-

Apr

11-

Apr

12-

Apr

0 0 0 0 0

36

0 0 0 0 0 2 2 3 364 5

7 9 10

21-

Feb

15

28

1821

25

47

5459

64

6974

81

9298

12

106

111

139

115 120125

133136

144 148152

156

221% 217%

102

E-commerce

COVID-19 Cases (k)Click & Collect

Home Delivery / Shipment

Italy

Note: Includes select E-commerce retailers including Amazon, other local eRetailers and the eCommerce operations of traditional Brick & Mortar retailers.Home delivery / shipment: goods delivered at doorstep of purchaser. Click & Collect: purchaser submit order online and collects in store.

Source: IRI Panel online, Dates reflect Monday, 17 February through Sunday, 12 April, 2020. Worldometer as of April 20, 2020.

EASTER


View from Europe: In France, E-Commerce Has Consistently

Grown Faster Than In-Store as COVID-19 Cases Grow


1,2095,423

16,018

40,174

92,839

120,633

8.7%

40.0%

30.6%

1.8% 1.3%

9.8%13.2%

5.3%

14.2%

30.4%

62.0%

74.8%

65.0%

76.6%

95.8%

0

10

20

30

40

50

60

70

80

90

100

16-Feb

0.9%

23-Feb

6.0%

8-Mar 12-Apr1-Mar

12

15-Mar 22-Mar 29-Mar 5-Apr

12 1301.2%

France

E-Com %

share of total6.8% 6.5% 7.4% 8.0% 7.7% 8.5% 10.8% 11.2% 10.5%

In Store

eCommerce

COVID-19 Cases

Note: Includes Click & Collect and some Home Delivery providers (Home Delivery represents a small portion of sales. Excludes Amazon.

Source: IRI POS Data Week Ending April 12, 2020. Worldometer as of April 20, 2020


Overall Demand Finally Settles Down for Week-Ending April 19; Nonedible

Demand Will Likely Remain Flat as Consumers Work Through Stockpiles

New IRI CPG Demand Index Provides a Standard Metric for Tracking Changes in Consumer Spending On CPG Purchases

ProductWeekly Dollar % Chg. vs. YA Index

Mar-01-2020 Mar-08-2020 Mar-15-2020 Mar-22-2020 Mar-29-2020 Apr-05-2020 Apr-12-2020 Apr-19-2020

TOTAL STORE 102 111 156 150 111 113 113 105

EDIBLE 102 108 160 161 117 121 121 108

NON-EDIBLE 102 116 148 134 100 100 98 100

ED

IBL

E

BEVERAGES 103 111 140 128 98 101 100 97

FROZEN 102 105 179 193 131 135 131 128

GENERAL FOOD 103 110 173 172 119 122 124 102

BEVERAGE ALCOHOL 104 109 128 140 121 127 127 117

REFRIGERATED 101 105 160 162 120 127 126 114

NO

NE

DIB

LE

BEAUTY 103 114 132 115 88 91 91 95

GENERAL MERCHANDISE 102 118 166 141 108 108 107 107

HEALTH 106 121 167 155 100 94 88 90

HOME CARE 109 141 203 175 122 115 112 118

TOBACCO 97 101 104 106 93 98 98 100

Updated on 4/21/20

Source: IRI CPG Demand Index. Click HERE for full dashboard



Pressures on

Easter 2020

• Earlier in the month holiday benefits from larger wallets beginning of the month

• Consumers seek comfort and normalcy during quarantine

• Celebration purchases mostly for household members; fewer parties and gifting

• COVID-19-related unemployment and concerns over income limit spending

With Varying Pressures On Easter Celebrations, U.S.

Consumers Spent More On Proteins and Less On Candy vs. YA

Easter Dollar Sales ($M)

Edible

15,822

12,620

13,776 13,979

COVID-19 Stock-Up Week Avg.

2 Weeks Prior to Easter

Week Prior to Easter

Easter Week

Fresh Meat

1,118

908

1,008

1,084

58

25

Smoked Ham

27

122

Candy

625

344

401

317

9685

Seasonal Easter Candy

157

344

+45%* +14% +22% +13% +55% +23% +35% +25% +127%* +1% +36% +85% +13*% -13% 0% -9% +9%* -20% -4% -17%

% CHANGE VS. EASTER 2019

Note: Easter Week refers to week ending 4/12/20, Easter Week 2019 refers to week ending 4/21/19. COVID-19 stock-up week average refers to average of 3 weeks ending 3/22/20. *Figure for COVID-19 stock-up week avg. compares to same time period year ago. Candy refers to Chocolate and Non-Chocolate Candy.

Source: IRI POS data Total U.S. MULO ending 4/12/20.


F&B Nonedible

Upper Income Households’ Food & Beverage Spend Increases Are

More Dramatic Overall Than That for Lower Income Households

$ Chg. vs. YA // All Manufacturers // POS Store Level Data

-20

0

20

40

60

80

100

02-16-20 04-12-2003-01-2002-02-20 03-15-20 03-29-20

Lower Income

Upper Income*

-40

-20

0

20

40

60

80

02-02-20 02-16-20 03-01-20 03-15-20 03-29-20 04-12-20

*Note: Upper income represents stores in which average income in trade area is >$80K household income per year; lower income is <$40K per household per year. Source: POS; non-projected


Large Manufacturers Continued to Lose Share to Mid-Size

and Smaller Manufacturers and Private Label in 2020

% Share of Total Store Sales by CPG Manufacturer Size

Pre-COVID

14.7

11.1

49.5

15.215.3

11.6

15.6

2014

9.1

48.0

9.8

46.2

15.3

20192018

11.6

47.5

11.6

47.0

10.1

15.6

11.8

15.3

10.0 9.9

16.1

15.6

16.5

COVID

Large

Extra Small

Medium

Small

Private Label +0.6

+0.7

+0.5

-0.3

-1.5

+0.3

+0.3

0.0

-0.5

+0.4

-0.1

+0.2

+0.3

-0.8

2020

-0.1

Manufacturer COVID-19

Performance

• Greater boost to players in primary COVID-19 stock-up categories (paper products, soap, disinfecting cleaners, shelf stable food)

• Less acceleration for manufacturers with greater presence in convenience channel (beverages particularly energy drinks, alcohol)

• Lower growth for those impacted by greater out-of-stocks (e.g., #1 brands) and closed manufacturing facilities (e.g., meat)

Note: Large is $5.5B+ in L52W, Medium $1-5.5B, Small $100M-1B and Extra Small <$100M. Pre-COVID-19 is 8 weeks ending 2/23/20, COVID-19 is 7 weeks ending 4/12/20.

Source: IRI POS data Total U.S. MULO+C ending 4/12/20.


F&B Nonedible

59% of consumers have chosen store brands in the past month to save money

54% of consumers have chosen store brands in the past month because the brand they usually purchase wasn’t available

-0.4

-0.2

0.0

0.2

0.4

0.6

0.8

1.0

1.2

0.0

0.5

1.0

1.5

2.0

2.5

While Private Label Food & Beverage Share is Higher in Lower-Income

Markets than in Upper-Income Markets, it is Gaining Share in Both

Private Label $ Share PPT. Change vs. YA // POS Store Level Data

03-01-20 04-12-2003-15-2002-02-20 03-29-2002-16-20

Private Label F&B $ Share

Upper Income: 16.6

Lower Income: 22.6* Private Label Nonedibles $ Share

Upper Income: 17.4

Lower Income: 19.9*

*Note: Upper income represents stores in which average income in trade area is >$80K household income per year; lower income is <$40K per household per year. Source: POS; non-projected, IRI Consumer Survey, Wave 6, April 17-19

Lower Income

Upper Income*

03-01-20 04-12-2003-15-2002-02-20 03-29-2002-16-20


Shopping Trips Are Down as Consumers Adhere to Stay-at-Home Orders

IRI U.S. Product Trip Index is Calculated Based on % Change in Trips in Most Recent Week vs. Year Ago

Product

Weekly Product Trips Index

Feb-16-

2020

Feb-23-

2020

Mar-01-

2020

Mar-08-

2020

Mar-15-

2020

Mar-22-

2020

Mar-29-

2020

Apr-05-

2020

Apr-12-

2020

TOTAL STORE 104 104 103 109 142 140 101 97 96

EDIBLE 105 105 104 108 145 145 105 101 100

NON-EDIBLE 102 100 101 113 145 137 103 99 97

ED

IBL

E

BEVERAGES 105 101 104 111 148 140 102 100 99

FROZEN 105 102 102 104 158 169 123 120 118

GENERAL FOOD 104 105 104 108 150 149 104 102 104

BEVERAGE ALCOHOL 101 110 101 106 124 130 112 110 113

REFRIGERATED 105 103 101 104 146 150 111 110 108

NO

NE

DIB

LE

BEAUTY 102 100 101 116 133 120 93 96 97

GENERAL MERCHANDISE 101 100 101 113 152 138 106 106 103

HEALTH 106 102 104 118 150 139 101 90 86

HOME CARE 105 103 107 134 186 175 126 125 118

TOBACCO 76 92 88 95 97 97 76 83 79

Source: IRI Consumer Network Panel Week Ending April 12, 2020 vs. year ago Total U.S. All Outlets




While Shopping Trips Decline, Basket Sizes Increase: Shoppers

Opt for Fewer Trips, But Purchase More When They Shop

IRI U.S. Product Trip Index is Calculated Based on % Change in Basket Size in Most Recent Week vs. Year Ago

Product

Basket Size Index

Feb-16-

2020

Feb-23-

2020

Mar-01-

2020

Mar-08-

2020

Mar-15-

2020

Mar-22-

2020

Mar-29-

2020

Apr-05-

2020

Apr-12-

2020

TOTAL STORE 100 99 100 103 116 115 114 120 122

EDIBLE 101 100 100 102 117 119 118 126 127

NON-EDIBLE 100 100 101 104 107 103 100 101 103

ED

IBL

E

BEVERAGES 100 102 100 102 108 107 108 111 112

FROZEN 102 104 101 102 114 114 108 113 113

GENERAL FOOD 102 100 101 104 120 121 119 124 125

BEVERAGE ALCOHOL 101 96 104 99 109 127 118 117 116

REFRIGERATED 100 100 100 102 113 110 111 118 120

NO

NE

DIB

LE

BEAUTY 99 98 99 96 95 89 90 91 90

GENERAL MERCHANDISE 101 99 101 103 105 102 99 98 103

HEALTH 100 101 101 103 109 111 104 106 108

HOME CARE 101 101 103 106 106 100 98 94 99

TOBACCO 110 101 100 100 108 119 114 117 112

Source: IRI Consumer Network Panel Week Ending April 12, 2020 vs. year ago Total U.S. All Outlets




c

c

Households With Children Are Making Greater Contributions to Total

CPG Sales Growth, 36% of Total Sales and 41% of Industry Growth

Source: IRI Weekly Surveys among IRI Consumer Network™ Panel representing Total U.S. Primary Grocery Shoppers

34.5%

36.0%

40.7%

% of Total SalesApril 2019

% of Total SalesApril 2020

Contributionto Growth

Not Only Are Households Preparing More Meals During

Quarantine, Families Simply Have More Mouths to Feed

CHILDREN AT HOME


cSource: IRI Weekly Surveys among IRI Consumer Network™ Panel representing Total U.S. Primary Grocery Shoppers

37.1%39.5% 41.0%

42.8% 44.5% 45.8%

20

19

20

20

20

19

20

20

20

19

20

20

Large Urban Markets Mid-Size Markets Small / Rural Markets

In Rural, Mid-Sized, Urban Markets, Panty Stocking Trips Increased from 2019

to 2020; While Overall % is Lower in Urban Markets, % Increase is the Largest

Pantry Stocking Trips Now Account for More Than 40% of Dollars Across U.S. Markets, With Smaller

Markets Continuing to Rely On Pantry Stocking Visits More Than Their Larger Market Counterparts


Grocery is Outpacing MULO Growth Since Peak Stockpiling;

Convenience Sales Continue to Decline vs. YA

Week Ending February 9 – April 12, 2020

$ Sales % Change vs. Year Ago

MULO

Grocery

Convenience

3%

17% 16%

4% 3%

77%

66%

28% 27%

2% 0%

3%0%

-9%-10

0

10

20

30

40

50

60

70

80

15-Mar16-Feb 5-Apr9-Feb 23-Feb 29-Mar1-Mar 8-Mar 22-Mar 12-Apr

4%

10%

11%

63%

58%

14%

-7% -5%

22%

Stockpiling begins

Note: MULO includes Grocery, Drug, Mass, Club (excluding Costco), Dollar and DeCA retailers. Source: IRI POS data ending April 12, 2020.


Pantry Stocking Trips Continue to Rise While Other Trip

Types Slowed and Even Dipped in the Latest Week

>70% of Consumers Report Buying Enough Groceries Their HH Needs For 2 Weeks or More

-40

-30

-20

-10

0

10

20

30

40

50

60

70

03-08-2002-02-20 02-23-2002-16-20 04-12-2003-15-2002-09-20 03-22-2003-01-20

FILL-IN

03-29-20 04-05-20

PANTRY

STOCKING

SPECIAL

PURPOSE

QUICK

TRIP

Source: IRI Consumer Network Panel

Total Trips % Change vs. YA by Trip Type // Total U.S. All Outlet // National Consumer Panel

Pantry stocking’s importance is emphasized by sheer growth, accounting for 44% of total dollars in 2020, a solid 4-point gain

60% of growth in dollars is driven by pantry stocking trips, 25% higher than its total share of 44%


Consumers Shifting Nonedibles Purchases From Mass to Grocery; Dollar

Channel Trips Are Up and Could Signal Start of Recessionary Behavior

Trips Index vs. YA // NCP

Feb-

02

Feb-

09

Feb-

16

Feb-

23

Mar-

01

Mar-

08

Mar-

15

Mar-

22

Mar-

29

Apr-

05

Apr-

12

All Outlet 106 106 107 106 106 110 147 147 108 103 102

GroceryX 104 106 106 105 105 108 160 153 111 108 105

Drug 101 91 90 98 96 99 108 110 73 74 86

MassX 100 98 90 96 94 107 144 126 91 86 77

Walmart 103 107 108 108 106 108 124 137 104 92 90

Club 105 105 109 106 110 116 150 135 104 97 96

Dollar 105 108 110 107 113 118 158 161 112 113 109

Feb-

02

Feb-

09

Feb-

16

Feb-

23

Mar-

01

Mar-

08

Mar-

15

Mar-

22

Mar-

29Apr-05 Apr-12

104 99 103 100 101 114 146 137 105 100 98

106 102 100 98 109 125 199 166 120 122 116

99 91 90 100 99 105 131 132 93 84 83

95 89 89 90 86 104 139 116 79 74 70

101 101 106 101 97 110 123 116 96 87 80

103 101 105 99 108 121 146 123 103 102 102

99 104 108 100 107 121 166 155 116 110 106

F&B NONEDIBLE



Grocery F&B Basket Size Remains Robust Over Past Several Weeks vs. Year Ago,

a Trend That Will Continue; Dollar Channel Baskets Gaining in F&B and Nonedibles

Dollars per Trip Index vs. YA // NCP

Feb-

02

Feb-

09

Feb-

16

Feb-

23

Mar-

01

Mar-

08

Mar-

15

Mar-

22

Mar-

29

Apr-

05

Apr-

12

All Outlet 95 100 99 99 97 100 115 118 115 124 125

GroceryX 96 99 98 98 97 100 115 116 116 125 127

Drug 97 105 111 100 99 99 114 123 128 129 133

MassX 74 101 100 98 98 103 114 128 119 123 129

Walmart 95 102 101 98 97 99 119 119 109 124 126

Club 94 99 96 101 98 98 110 113 111 116 125

Dollar 93 101 98 107 108 107 115 133 128 126 124

Feb-

02

Feb-

09

Feb-

16

Feb-

23

Mar-

01

Mar-

08

Mar-

15

Mar-

22

Mar-

29Apr-05 Apr-12

98 102 100 100 101 104 105 103 98 100 103

95 100 101 103 100 102 107 103 100 99 100

104 110 110 99 103 110 115 110 101 106 105

84 111 98 97 103 104 113 107 96 91 95

100 101 98 100 104 105 109 107 100 106 107

98 98 95 98 97 104 101 95 95 97 106

96 113 98 95 103 109 124 114 111 114 121


F&B NONEDIBLE


E-Commerce, Grocery, Dollar Growing at the Expense of Other Channels; Some Categories Predisposed to E-Commerce, Others to Dollar Channel

EconoLink®** Consumer Segments Illustrate Focus of Channel

Shifting Varies Based on Consumers’ Economic Predispositions

Cautious & Worried consumers are flocking

more to the dollar channel, while

e-commerce has nearly doubled among

the Carefree consumers

% Chg. vs. YAG – Dollars/1,000 HHs – Total Respondents

Source: IRI Consumer Network© Panel, Total US, 56-weeks static, 4 WE 4/12/2020; please see Appendix for EconoLink segments. *Grocery does not include Walmart.

-13%

-4%

2%

7%

11%

15%

21%

22%

68%Internet

Grocery*

Dollar

Total U.S. All Outlets

Walmart Total

Drug

Club

Mass / Supercenter

Specialty Stores / All Other

+33%

Cautious & Worried

Dollar Channel

+88%Carefree

Internet Channel

Cautious

& Worried,

Carefree


Younger Consumer Segments Embrace

Prepared and Frozen Foods, and Meal

Kits and Take-Out Faster Than Others

Start-Up

Consumer

Segment

Compared to consumers overall, Start Ups are twice as likely

to have increased both their orientation to convenience

options, as well as traditional food preparation / cooking.

Overall, Start Ups

tend to be younger,

and while many are

struggling a bit

financially, they have a

positive outlook that

things will get better.

Source: IRI EconoLink Syndicated Segmentation / Wave 5 Weekly COVID-19 Thought Leadership Survey, April 10-12, 2020. See Appendix for EconoLink segments.

33%

16%12%

5%

51%

33%

26%

19%

Creating meals from scratch

Making meals using packaged

prepared or frozen foods

Getting pre-made meals by delivery or take-

out

Buying meal kits

Total Start Ups

% Doing More Often

Than Before Coronavirus


Convenience & Gas Food and Beverage Sales Accelerated

Slightly in the Latest Week, But Remain Negative

Dollar % Change vs. YA // C&G // TSV Model

-14

-12

-10

-8

-6

-4

-2

0

2

4

6

8

02-16-2002-02-20 02-09-20 02-23-20 03-01-20 03-22-2003-08-20 03-15-20 03-29-20 04-05-20 04-12-20

6 month C&G F&B benchmark (+4.3%)

Feb 2020 lapping no SNAP payment in Feb 2019

6 month C&G Total Store benchmark (+3.7%)

6 month C&G Non-Edible benchmark (+3.1%)

Total Store

Nonedibles

F&B

Note: Data reflected does not include Costco or Total eComm Source: IRI AllScan

March 15U.S. confirmed cases

surpass 3,000

March 2642 states have instituted “shelter in place” orders

March 13CPG retail sales were 53% higher

than the highest day in 2019


Food Channel Represents Just 20% of Brick & Mortar Beauty Dollar Sales But It’s

Growing at the Expense of Drug; Mass Has Been Declining in Recent Weeks

Beauty Department $ Change

Beauty $ Share

of MULO+C

Mass 47.6%

Drug 22.2%

Food 19.8%

1.6%2.6%

-1.9%

3.8%

-3.5%

-7.7%

-17.7%

21.2%

-8.9%

-11.9%

-19.2%

7.9%

MULO+C Mass Drug Food

Latest 4 Weeks Ending 04-12-20


Latest 1 Week Ending 04-12-20

Source: IRI POS MULO+C Data Ending 4.12.20


With Salons Closed, Consumers are Taking Hair Care into Their Own Hands

Select Beauty Aisles $ % Change YA

1.6% 1.4% 2.9% 2.0% 1.6%

-9.0%

-1.0% -1.1%-3.5%

-0.2%

4.6% 3.5%

24.7% 25.3%

3.8%

12.3%

-8.9%

-1.3%

-8.1%

-1.7%

27.0%

39.1%

14.4%

53.6%

DEPT-BEAUTY AISLE-HAIRCARE

SHAMPOO HAIRCONDITIONER

HAIRCOLORING

HOMEPERM/RELAXER

AISLE-GROOMINGSUPPLIES

ELECTRICSHAVER

GROOMER




Source: IRI POS MULO+C WE 4.12.20


Nail Color is the Bright Spot in Beauty Category;

Facial Cosmetics Are Put Aside During Quarantine

Cosmetics $ % Change YA

-4.6%-8.9% -6.4%

6.8%

-43.5% -44.3%

-60.5%

30.0%

-43.8%-48.0%

-61.1%

54.1%

COSMETICS - EYE COSMETICS -FACIAL

COSMETICS - LIP COSMETICS - NAIL

1.6%

-3.5%-3.5%

-30.5%

-8.9%

-27.0%

DEPT-BEAUTY AISLE-COSMETICS




Source: IRI POS MULO+C WE 4.12.20


c


c

Consumer Concern for COVID-19 Slowly Eases

After Weeks of Increasing Anxiety, Fewer Consumers

Report Being More Concerned About Coronavirus

Source: IRI Consumer Survey fielded among Primary Grocery Shoppers in the National Consumer Panel, March 13 – April 19, 2020.

38%

54%

60%

25%

Wave 1 - 3/13-3/15

Wave 6 - 4/17-4/19

Extremely ConcernedAbout COVID-19

More Concerned AboutCOVID-19 Than Last Week


Consumers Increasingly Believe COVID-19 Will Linger for Months;

Economic Woes Are Predicted to Last More than a Year

Expected Length of Coronavirus Health and Economic Crises

*Note: numbers do not = 100 due to rounding / Source: IRI Consumer Survey fielded among Primary Grocery Shoppers in the National Consumer Panel, March 13 – April 19, 2020.

Concerns About the Duration of an Economic Recession

Increased This Week

believe it will be45%months beforemore than 12

the economy recovers

Wave 1

3/13-3/15

Wave 5

4/10-4/12

1 wk. - 3 mos. 66% 51%

4 - 12 mos. 32% 48%

How Long Respondents Believe the

COVID-19 Health Crisis Will Last*


26%

40%

45%

52%

53%

63%

86%

55%

14%

100%

25%

People Discussing on Social Platforms How to Spend CARES

Stimulus; Purchasing Groceries Trails Paying Bills and Saving

44%

40%

42%

39%

35%

24%

50%

40%

0%

0%

67%

56%

60%

58%

61%

65%

76%

50%

60%

100%

100%

33%

Sentiment

Gender

Female / Male

Source: IRI Social Pulse by Infegy, March 23-April 22, 2020 / IRI Consumer Survey fielded among Primary Grocery Shoppers in the National Consumer Panel, March 13 – April 19, 2020.

of Americans have received

stimulus / relief money

47%

more expect to receive it in

the coming month

28%

© 2020 Information Resources Inc. (IRI). Confidential and Proprietary. 40© 2020 Information Resources Inc. (IRI).

Confidential and Proprietary. 40

CONTACT US FOR MORE

INFORMATION

IRI Global Headquarters

150 North Clinton Street

Chicago, IL 60661-1416

[email protected]

+1 312.726.1221

Follow IRI on Twitter: @IRIworldwide


IRI COVID-19 Thought Leadership

Helping You Stay Informed

IRI’s Online Insights Offers Real-Time

Updates and Weekly Reports of the Impact

of the Virus on CPG and Retail, as Well as

Consumer Survey Data from this Report

The IRI COVID-19 Info Portal

Includes COVID-19 impact analyses, dashboards

and the latest thought leadership on supply chain,

consumer behavior, channel shifts for the U.S.

AND international markets

The COVID-19 Dashboard

Accessible through the insights portal

and tracks the daily impact of COVID-19.

This includes the top categories across

countries, out-of-stocks and consumer

sentiment on social media.

https://www.iriworldwide.com/en-US/Insights/Publications/coronavirus-impact-to-CPG-and-retail

https://advantage.iriworldwide.com/Engineering/covid19/


Down-trodden

9%

Cautious & Worried

32%

Start-Ups12%

Optimistics21%

Carefree18%

SavvyShoppers

8%

DOWNTRODDENTheir financial situations are markedly worse vs. YAG, and their go-to response is depravation; they try to cut back on everything. Purchases highly influenced by price, brand, and/or prior experience/trust.

SKEWS: Older Millennials/Younger Boomers | Blue Collar | Hispanic | Lower Income

CAUTIOUS & WORRIEDTheir financial situations are markedly worse vs. YAG, and they do not hold out a lot of hope for things to get better.

SKEWS: Baby Boomers | Live Alone

START-UPSTheir financial situations are largely the same as YAG, but they’re still struggling. They, too, are focused on cutting back, but with positive expectations for future improvement in their financial situations.

SKEWS: Gen Z/Millennials | African American, Asian | Blue Collar | Lower Income

CAREFREETheir financial situations are in a stable place; no real financial concerns. They’re willing to splurge on premium products, and brand preference is a greater driver than price for their buying decisions.

SKEWS: Older Boomers & Retirees | Male | Live Alone | Upper Income

OPTIMISTICSTheir financial situations are better vs. YAG, and they are optimistic about their financial future. Price is on their radar, but so are product experiences and brand trust.

SKEWS: Gen Z, Millennials and Gen X | 4+ Member HHs | African American | Mean HHI $72,000

SAVVY SHOPPERSTheir financial situations are improving vs. YAG, but they still look for value – although that doesn’t always mean the lowest price. They love to find coupons and good deals on groceries.

SKEWS: Younger Baby Boomers, Retirees | Mean HHI $75,600

EconoLink Provides View of Americans’ Response to COVID-19 Through a

Human Economic Lens That Goes Beyond Income; Not All Respond Alike

IRI EconoLink, IRI Survey fielded 3/20-3/22, 2020, among IRI Consumer Network™ Panel representing Total U.S. Primary Grocery Shoppers