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    Online Exclusives

    What Consumer Trends Have Lasted this Far into the Pandemic?

    Market researchers have reached some consensus on which consumer mindsets have solidified.

    What Consumer Trends Have Lasted this Far into the Pandemic?
    Surveys, sales data, and product trends are further elucidating how COVID-19 has changed the consumer mindset when it comes to nutrition.
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    By Mike Montemarano, Associate Editor 08.17.20
    Approximately six months since the COVID-19 pandemic sank its grip into everyday life on a global scale, and emergency orders mandated social distancing measures, many of the trends that were expected to rise as a result of living in quarantine have certainly fleshed out; however, some appear to have greater staying power than others, according to a combination of surveys and market analysis within the dietary supplements industry.
     
    It seems the end of this pandemic will be dictated by development, mass production, and distribution of a vaccine. During this time, it’s important to understand what types of natural products consumers are seeking, what their health goals are, and how long current trends will continue as people begin returning to workplaces, restaurants, and other venues that have been off-limits since the beginning of March.
     
    Leveling Off
    According to a July presentation held jointly by market research companies IRI and SPINS, mid-May saw a leveling off of dietary supplement sales across all categories, after year-over-year gains as high as 200% were seen in products marketed for immune support, or cold/flu applications within the natural channel.
     
    Still, the leveling off point appears to be at an impressive 10% sales increase. Interestingly enough, the sales boom of dietary supplements is no longer under the sole reign of products with some type of immune support claim, such as zinc, elderberry, Echinacea, and more.
     
    Increases in purchases driven by the desire to improve one’s immune system have now been eclipsed by a massive rise in those seeking out dietary supplements for mood and sleep support, the companies reported.
     
    A time period in mid-May saw mood and sleep supplements rise to achieve a 50% year-over-year increase in sales, indicating that the boom now has mutual causality between staving off the risk of contracting and spreading the virus, and the loss of sleep and mood issues associated with the disruptions to daily life. While cold/flu and immune health supplements once saw a 200% spike in sales during a few-week span in March, this category has since leveled off to a spike of about 25% increased sales by mid-May.
     
    Notably, probiotics have been catapulted into a leading position within the immune support space. According to MarketPlace, from March to June 2020, the leading products being purchased for an immunity purpose were vitamin D (54%), vitamin C (53%), probiotics (35%), and zinc (21%).
     
    “Consumers are beginning to view gut health as a pathway to immunity and general health, which widens the door for probiotics in all kinds of nutrition applications,” Tracy Landau, president of MarketPlace, said. It appears that those who buy immune-boosting products are also focusing on conventional foods as a nutritional avenue for immune support.
     
    MarketPlace reported that over half of its survey respondents have changed their diet (51%), with eating more fruit (54%) being a central intervention. Coincidentally, the preference for pills over functional foods for immune support has declined from 89% last year to 72% this year, according to MarketPlace’s data.
     
    “Innovative formulations that address pill fatigue and increase the bioavailability of immune boosting ingredients, especially tea and yogurt applications, are growth opportunities for food and beverage brands and ingredient suppliers,” said Jon Copeland, MarketPlace’s research strategist.
     
    Who will Reap the Most from Stimulus Checks?
    IRI also conducted a large survey, representative of the U.S. population, with the intention of modeling how consumers plan on spending a second COVID-19 economic stimulus check, should federal legislators pass one in the near future.
     
    Consumers reported a greater feeling of stress as a result of pandemic-related uncertainties on their fiscal and physical well-being, IRI noted. Forty percent of all survey respondents reported feelings of stress, a number which rose to 49% among the unemployed respondents in particular. Meanwhile, 38% of consumers said the issuance of the next economic stimulus check will have an impact on their purchasing decisions in the realm of foods, beverages, dietary supplements, and personal care items, compared to 30% of those who were influenced by the first stimulus check. The top beneficiaries of the next stimulus check, among those whose purchases will be fueled by the financial padding, will be meat and produce (21%), over-the-counter healthcare items (7%), restaurant spending (7%), and beauty/personal care products (7%). Consumers will be most likely to spend their money at mass retailers, grocery stores, and e-commerce channels than at any other place (e.g., drug stores, buyer’s clubs, dollar stores, pet specialty stores, or convenience stores).
     
    IRI also aimed to determine which segments of the nutrition market would be hit the worst if the extra $600 weekly unemployment benefit—installed as a response to the pandemic—is reduced.
     
    It appears that every channel in the functional foods and dietary supplements industry will be taking a hit as a result of the potential reduction of unemployment benefits, which has been in discussion. A June report from the U.S. Department of Labor showed that 18 million Americans are still out of work, overwhelmingly (88%) as a result of the pandemic.
     
    According to the survey, products which will see the greatest reductions in spending if unemployment benefits are reduced would be meat (35%), fruits and vegetables (29%), and snacks (27%). Grocery stores (-40%) and online-only retailers (-39%) will see the greatest declines in the wake of unemployment cuts, respondents suggested.
     
    Sustainability Will Have Staying Power
    Research conducted by the New York University Stern Center for Sustainable Business, in conjunction with IRI, found that in the year 2020, sustainability-marketed products increased by a 16.8% dollar market share, compared to an increase of 0.6% in the year 2019, reflecting a rapid, sweeping shift in the consumer climate. Weight control and coffee products have seen the greatest rise, among other products such as paper and soap. Compared to conventional products, sustainability-marketed products grew at a rate over seven times faster than those in the conventional channel.
     
    “Our analysis demonstrates that sustainability-marketed products enjoy a hefty premium, continue to grow faster than their conventional counterparts, and contribute to over half of the growth to overall CPG,” Randi Kronthal-Sacco, senior scholar at NYU Stern Center’s Marketing and Corporate Outreach, said. “It’s clear that brand managers who are not pursuing sustainability strategies will be increasingly left behind.”
     
    Consumer research company Suzy concurred, with its own results suggesting that 34% of consumers are buying more organic products than before; products with eco-friendly packaging have seen a sales increase of 24% since the start of the pandemic.
     
    However, it appears that demand for brands to speak to social sustainability and equity issues is heightened as well. According to Suzy, 62% of consumers said they are more likely to purchase from food brands that “publicly stand for the causes they believe in.” While 66% of those consumers feel environmental issues are the most important within the domain of food, 74% said that social equity and social justice issues were more important points of interest.
     
    How and Why We Purchase Food is Changed Forever
    Market researchers at Suzy believe that the U.S. consumer’s relationship with food has been altered permanently as a result of the pandemic.
     
    Overall, the company reported that of all consumer spending arenas, the greatest changes have been seen in the grocery store, and, for the most part, at least 50% of consumers will be keeping up newfound food shopping habits that were adopted during the quarantine.
     
    Suzy found 59% of grocery shoppers will continue buying their groceries online even when social distancing restrictions are lifted—a warning for brick-and-mortar establishments. For some reference, the company reported that online grocery purchases have tripled since the onset of the pandemic. Additionally, a shift to local providers is also in the works; 28% of consumers are more likely to shop local establishments before visiting national chains.
     
    Consumer loyalty may be permanently diverted as well, given that 70% of consumers told Suzy they have tried a new food brand over the past two weeks; 49% of those consumers plan to continue shopping for the brands that they normally would not have purchased, indicating that this period of experimentation, sparked in part by supply chain problems, might be waning as consumers solidify their newfound relationships with products, and supply chain issues continue to resolve.
     
    The supply chain issues spurred by stockpiling at the onset of the pandemic may not be as relevant to the rise of consumer experimentation as was once perceived; however, 49% of consumers said they’ve tried new products recently out of curiosity, and not as a result of out-of-stock issues.
     
    Additionally, it’s becoming clear that, while value still remains a high priority in food purchasing decisions, financial costs are much more balanced out by perceived costs, or benefits, to one’s health.
     
    According to Suzy’s research, 77% of consumers who reported heightened concern about health issues are more likely to buy foods, beverages, and supplements to address those concerns, showing widespread embrace of nutritional interventions as means to mitigate the perceived risk in daily life.
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