Connecting to Today's Shoppers Across Channels - ARF Shopper X Science - Advertising Research Foundation
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ARF Shopper X Science Connecting to Today’s Shoppers Across Channels Jennifer Pelino; EVP Omni Channel Media, IRI March 2, 2021
COVID-19 and Associated Economic
Fallout Had Substantial Work and Workout At Home
Impact on the CPG Demand Curve Physical home space changed
to accommodate stay-at-home
Home Upgrades, Inside
& Out, Especially Digitally
Outdoor spaces, gardens, Consumption Shifts
workspaces, cookery, kitchen More spending at-home
appliances, streaming services Self- and vs. away-from-home,
Societal Care increase in cleaning
Convenience
Indulgence
Leisure & Holidays Shopping Shifts
Entertainment, holidays, Increased adoption of e-commerce,
and celebrations look different fewer trips, bigger baskets, less
product discovery in store
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 2
Isolating, Working, and Working Out at Home Means Elevated
In-Home Consumption Across Many Categories
Consumers were re- Staycations got a lift Sales of home fitness Work commute trips With movie
introduced to the in 2020 with equipment grew more than 40% nationally theaters closed,
kitchen; 53% report upgrades to outdoor in 2020, hitting $9.5B. remain 30%-40% streaming
they’ll continue to spaces. below services saw a
Athleisure sales account for pre-pandemic levels. 37%** increase in
create meals from
26%* of adults 31% of apparel spending in 2020. 2020.
scratch Many who are working
started
a food garden from 12 million people
because of the home will continue to attended Fortnite’s
pandemic. do so – at least part Travis Scott concert
of the time – post- in April 2020.
pandemic.
Source: *https://www.wsj.com/articles/covid-19-pandemic-likely-improved-your-commute-to-work-11609669801
, **https://www.reportlinker.com/p05948407/Home-Fitness-Equipment-Global-Market-Report-30-Covid-19-Implications-and-Growth.html?utm_source=GNW
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 3
E-commerce, Grocery, Club and
Dollar Channels Emerged as Key Winners
Total CPG % Change vs. YA
Trend vs.
2019 vs. 2018 2020 vs. 2019 2019 growth
Total Omnichannel 3.2% 15.5%
MULO Brick & Mortar 1.3% 11.5%
Grocery Brick & Mortar 1.0% 16.3%
Mass Merch. Brick & Mortar1 1.6% 3.6%
Club (Sam’s, BJ’s & Costco)1 2.6% 14.1%
Drug1 -0.5% 0.9%
Convenience 3.4% 2.9%
E-commerce2 22.0% 58.6%
Dollar1 12.7% 19.3%
Note: Omnichannel includes MULO + C + Costco + Dollar + E-comm. 2020 = data ending Nov 29, 2020, forecast for remainder of year. Source: IRI POS, eMarket Insights and Consumer Panel
1. 2020 vs. 2019 based on 52 weeks ending Nov 29, 2020 vs. YA. 2. E-commerce data includes e-commerce of MULO and Grocery as well as pure plays. Dollar based on Panel
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 4
Top Growing Categories by Channel; Saw Some Similar Leading
Categories and Some Specific Drivers to Each Channel
Source: IRI POS, Panel and eMarket Insights.
Channels filtered on largest categories in 98% of channel sales; IRI Consulting analysis.
© 2019 Information Resources Inc. (IRI). Confidential and Proprietary. 5
Categories with Highest Existing E-commerce Share Continued
to Shift More Share to the Channel in 2020
Share ppt Share ppt
Edible Chg. Nonedible Chg.
1 Shelf Stable Coffee Creamer 12.8 1 Pet Supplies 15.9
2 Frozen Meat 8.6 2 Hair Accessories 15.7
3 Shelf Stable Meat 8.5 3 First Aid Accessories 15.0
4 Dried Fruit 8.4 4 Cosmetics Accessories 14.2
Shaving Lotion / Men’s
5 Drink Mixes 8.1 5 Fragrance
13.9
6 Tea (Bags/Loose) 8.0 6 Women’s Fragrances 13.4
Cleanings Tools
7 Shelf Stable Vegetables 7.7 7 (Mops/Brooms)
11.8
Baby Feeding/Care/
8 Frozen/Refrigerated Poultry 7.7 8 11.5
Travel Accessories
9 Canned/Bottled Fruit 6.8 9 Water Filters/Devices 11.2
10 Mustard & Ketchup 5.9 10 Cosmetics ― Nail 10.4
Total Edible E-commerce share: 6.5% Total Nonedible E-commerce share: 22.9%
Source: E-market Insights, POS and Panel, Omnichannel defined as MULOC+Costco+E-commerce
Considered categories with sales >$500M in Omnichannel and >10% growth in Omnichannel IRI Consulting analysis.
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 6
Many Manufacturers Saw Triple-Digit Growth in E-commerce
LARGE MEDIUM SMALL
Source: E-market Insights, Large Defined as >$5.B in sales in MULOC, Medium defined as >$1B MULOC Sales, Small Defined as >$100M MULOC Sales
Considered manufacturers with sales >$100M in E-commerce, IRI Consulting analysis.
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 7
Changes in Shopping Behavior Impact Product Discovery;
In-Store Searches Are Down, Online Searches Increase
Focused on 31
-4
Looking for Basics 35
Spending Minimal 30
+5
Time in Store 25
Only Looking if Usual 19
Products Are Unavailable 21
Not Noticing Many 18
-6
New Products in Store 24
15
Tight on Money
13
Avoiding Touching 12
Too Many Items 14
Hard to Find New 10
Products Online 10 January 2021
May 2020
Source: IRI Consumer Survey fielded among Primary Grocery Shoppers in the National Consumer Panel, May 2020. n=1,400 (food and beverage only) ; January 2021, n=2,327.
Q. How has your approach to shopping for new consumer goods products -- including food and beverage, health care, beauty and personal care, home care, and pet care – changed during the COVID-19 pandemic?
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 8
Many Manufacturers are Starting Up or Buying Direct-to-Consumer (D2Cs)
Businesses To Help Them With the E-Com Shift and Consumer Connectivity
Advantages of Direct-to-Consumer EXAMPLES
Websites SweetSnacking.com, a direct-to-consumer website that
ships Bimbo Bakeries brands directly to consumers
• Connect Directly with consumers Lighthouse Incubator, an innovation platform to bring
new health and wellness products to the industry
• Becomes a test platform for innovations
Objective Wellness, a supplement company targeting
• Allows manufacturers to offer a customized and younger audiences
personalized experience Kit Kat Chocolatory, a direct-to-consumer website
that allows consumers to customize Kit Kat products
• Manufacturers can target new cohorts Launched two direct-to-consumer websites,
pantryshop.com and snacks.com, which allow
• Gather key information for more precision consumers to purchase for themselves and ship products
targeting as gifts, with most orders arriving in two business days
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 9
Attributes and Benefits Focused on Product Origins, Societal
Care, Lifestyle / Diets and Self-Care Are Growing Faster
Dollar Sales Growth of Products With Attribute and Benefit Types – MULO+C, 52 WE 12/27/20
Attribute Group F&B 2020 Growth Nonedible 2020 Growth
Product Origins (e.g., Artisanal, Made in USA) 18% 8%
Societal Care (e.g., B-Corp, Eco Friendly, Fair Trade) 14% 14%
Lifestyle Diets (e.g., Ketogenic, Plant-Based Diet, Vegan) 13% 9%
Allergens & Intolerances (e.g., Gluten-Free, Lactose-Free) 13% 7%
Clean Label (e.g., Common Allergen-Free, Non-GMO) 12% 4%
Self-Care (e.g., Immune Support, Antioxidants) 12% 7%
Botanicals & Oils (e.g., Lavender Oil, Citrus) 12% 5%
FDA Nutrient Claims (e.g., More Calcium, Reduced Calories) 10% 3%
Plant Based Protein (e.g., Pea Protein, Hemp Seed Protein) 9% 6%
Edible Growth 13% Nonedible Growth 6%
Note: Growth based on sum of relevant claims within group. Excludes ingredient label-based attributes. Source: IRI POS Data, Label Insights Claims, MULO+C, Data ending 12/27/2020
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 10Awareness and Search Are Key Elements in Online Shopping Experience;
Target Shoppers With Simple Language and Beneficial Attributes
Shopping behaviors during last online shopping experience;
those who have shopped for groceries online in the past two months:
59% Used the search tool to type in the name of a specific item
35% Used the category menus to browse for options within a category
32% Accessed list of pre-purchased items and reordered from that list
29% Checked for sales items before making a purchase decision
12% Looked for new items to try
Source: IRI Consumer Network™ Panel Survey representing Total U.S. Primary Grocery Shoppers – 5/22 – 5/24
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 11Retailers Also Invested to Win with Key Innovation Focused on Trending Themes
Self and Societal Care Indulgence Convenience
Albertsons waterfront Bistro and Kroger’s Simple Truth better-for- Target’s Good & Gather is the
Open Nature brands feature the you and Private Selection. The retailer’s number-one-selling
Responsible Choice sustainable company expanded with global food brand.
sourcing logo. flavors and restaurant quality. Refrigerated pizza dough is
Target’s Everspring made with Walmart partnered with Unilever available from The GIANT Co.
biobased, recycled materials or to develop and launch Find Your Kroger’s Home Chef meals kits
natural fibers. Happy Place candle and body are available in-store and for
Whole Foods’ 365 vitamins and care products. home delivery.
supplements are made without
preservatives, flavors
or colors.
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 12Many Retailers Have Started or Enhanced Their Retail Media Offerings to Support
Both Brick & Mortar and E-com/Click & Collect Offerings
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 13Retailers are Leveraging Their Data and
Connectivity to Win with Consumers and
the Manufactures
Purchase Based Retailer Advertising Programs; Ensure
Last Touchpoint for Conversion is Captured
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 14Anticipate Stickiness of Some 2020 Behaviors and Leverage These
Emerging Growth Pockets
Consumer
• Consumers will continue to shop online; store pick-up adoption
outpaces home delivery.
• Stricter hygiene regimens will remain.
• Health and wellness, indulgence, premiumization and taste exploration
trends will continue.
• As in-stocks improve, consumers will become more price sensitive.
• 2020 holidays will likely spark new traditions for subsequent years.
Retail/Manufacturer
• Retailers and manufacturers will continue to invest in e-commerce;
high levels of service are a differentiator.
• Retailer cleaning protocols adopted during pandemic are now table
stakes.
• Retailers will continue to reinvent store layouts, build in-store
experiences and invest in contactless payment options.
• As in-stocks improve, pricing will become more competitive.
• Holidays become an opportunity to promote new traditions, extend
the shopping season.
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 15Thought Starters for CPGs and Retailers for Winning with Shoppers
Self and Societal Care Indulgence Convenience
• Nutritional supplements, especially • More permissible indulgence, • Retail-driven ingredient bars for
those that support immunity, especially in support of dietary quick, fresh meal solutions.
mental health, and sleep. restrictions and lifestyle diets. • Meal kits with varying degrees of
• New self-care products to support • Premium private / own brands prepared foods (in-store, delivery).
other wellness efforts, e.g., as a point of differentiation, • New support for meal solutions
products for pre- and post-workout. especially for meal components. from products in-store, via retailer
Skin care products that include • Customizable celebration kits apps, shoppable recipes.
remedies for joint pain, skin health. for various occasions. • Shopping convenience (e.g., menu,
• Sustainable, renewable and • Indulgent treats available in purchasing recommendations).
refillable packaging. smaller portions for smaller • Products designed for small
• Home care products that sanitize celebrations and smaller kitchen appliances, including
over longer periods of time. households. cocktail and other drink pods, air
• Water conservation in personal • Home spa products for fryer products / kits, sous vide, etc.
and home care products. consumers of all ages. • New e-commerce product
• Pet innovation will support post- discovery (e.g., shoppable recipes,
pandemic adjustments for sampling via click & collect or
socializing and anti-anxiety. home delivery).
Source: IRI National Consumer Network Product Trips Percent Change vs. Year Ago Through March 8, 2020
© 2021 Information Resources Inc. (IRI). Confidential and Proprietary. 16Want to Be the First to Know?
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CONTACT US Chicago, IL 60601
IRI@IRIworldwide.com
FOR MORE +1 312.726.1221
Follow IRI on Twitter: @IRIworldwide; @JenniferJ
INFORMATION Pelino
Jennifer.Pelino@IRIworldwide.com
© 2021 Information Resources Inc. (IRI).
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