NEW YORK — If your advertising categories have been highly impacted by the COVID-19 pandemic and household consumer packaged goods (CPGs) are being eyed for needed dollars, think again.
CPG spending declined by 8% in April 2020, compared to March 2020, newly released data from NCSolutions (NCS) show.
Where there is potential for new advertising is a category that has been heard in markets such as Riverside-San Bernardino and Los Angeles, but not so much in other parts of the U.S.
With extreme buying as COVID-19 concerns took root in the U.S., grocery sales increased by an unprecedented 36% in March 20, compared with a year earlier.
And, while April sales are lower than the preceding month, the new findings show household sales for the month are at significantly higher levels than usual: Household grocery spending in April 2020 is up 28% when compared with sales figures from the same period in 2019.
The NCS data also reflect an adaptation to new buying patterns shaped by the COVID-19 pandemic. April represents the first full month of the Home-Confined Buying stage as most Americans shelter in place.
Importantly, the data show American households continuing the return to pre-COVID-19 purchase preferences — but, with a few key differences.
When comparing the top-ranked categories to a year ago, NCS found the grocery basket mix in April closely resembles the contents of consumer carts prior to the pandemic. However, some items reflect the unique purchasing behaviors driven by the situation.
What does that mean? U.S. households are purchasing more sweets and convenience foods, such as ice cream and frozen entrees, than they did in April 2019.
Given this case, a variety of brands ranging from Dreyers/Edy’s and Breyer’s to Earthbound Farms, Birds Eye, Banquet Foods and Gardein may wish to consider a radio or TV effort, continuing to build on the sales momentum seen over the last eight weeks.
Another big category, in particular for spot radio and TV, is beer. With bars and pubs closed, at-home alcohol consumption is on the rise. A savvy brand could embark on a major broadcast media ad campaign now, and possibly gain considerable market share as its competitors opt to stay out of the media mix.
“Being at home has sparked new interest in several items,” said Linda Dupree, CEO of NCSolutions. “Shoppers are looking to their CPG purchases for comfort, convenience, variety and entertainment, which is clearly illustrated through the major changes in category sales rankings. It seems everyone has taken up baking recently; baking supplies are selling at extraordinarily high levels for the spring season, surpassed only by the holiday season, along with cocktail mixers and comfort foods.”
Flour and other baking ingredients, tomato sauces, refrigerated baked goods, various types of cocktails and mixers and frozen poultry also rank at the top of the growing category list.
CPG CATEGORY TRENDS: APRIL 2020-MAY 2020
Meat, baking ingredients and toilet paper are among the categories to watch in the month of May. Meat sales peaked on March 13, during a phase of consumer “Extreme Buying” with sales 211% higher than one year prior. Since recent news of potential shortages and supply chain disruptions, meat sales are again on the rise.
During the week of April 26t, consumers hurried to the store to stock up, especially on frozen products. In the same week, sales in almost every meat department category increased over sales from the previous week. Frozen poultry also topped all meat categories with a 30% increase in sales over the week prior.
Flour, which became one of the most coveted and scarce grocery items during April, closed out the month 38 spots higher in NCS’ CPG category ranking than the same time last year. Across the board, shoppers have prioritized baking ingredients, as they cook more at home resulting in an overall increase in spending.
“What does all of this mean for CPG brands? The extreme period of atypical household buying behavior appears to be settling down, creating a significant marketing moment for brands and marketers to refocus and double-down on courting their loyal buyers,” said NCSolutions’ Lance Brothers. “For brands that have been fortunate to gain some market share during this time, they have an opportunity to maintain that gain. They need to ensure they are ‘in-market’ and visible for their new customers. Building loyalty among new buyers will set up their brands for success in the short and long-term.”
Sales of toilet paper dropped after the March 11-March 12 peak, mainly due to stock-out challenges, with 70% of U.S. stores out of stock for some part of the day on March 23.
As toilet paper became more available at the beginning of April, it started to rise in rank again in the American shopping basket.
