COVID-19: The Disruptive Force That Defined 2020. What We Will Explore in 2021.
It would be a gross understatement to say that many, many, many Americans can’t wait to put 2020 in the rearview mirror. Inarguably, COVID-19 has driven changes in people’s lives as well as across the broad spectrum of the food and beverage marketplace. Some of these changes may be shorter term, while others will have staying power beyond the coronavirus pandemic.
While many of our eating, shopping, socializing, celebrating, and traveling occasions are sorely missed (or have become extremely complex due to the pandemic), 2020 hasn’t been a total bust.
There are many rekindled or newly discovered behaviors and relationships that have gained new appreciation and may even be functioning as silver lining positives during the new normal as consumers’ values evolve. These include:
• Deepened relationships within our households. While often difficult, it seems parents and children are learning more about each other — perhaps especially true when it comes to cooking, eating, and time in the kitchen
• New investigations of cooking from scratch, canning, and shopping for and ordering food online
• New interests in food and drink to boost immunity and ways in which to improve resilience
• Learning to be adaptive and how to improvise
• Newfound appreciations for all thing outdoors (gardening, bicycling, sitting outside, eating outside, exercising outside)
Pandemic-influenced changes looking beyond the household include:
• Deepened relationships with local "essential workers" ranging from healthcare workers and grocery clerks to food delivery workers and UPS, FedEx, and USPS workers
• New understandings of and appreciation for the efforts of local small businesses, business owners, and local food producers — this would include heightened interest in local restaurants
• Appreciation for products in stock in local food retailers
• Education in food supply chains and the effects of interrelated food production systems
• Appreciation for worker rights and employee safety
• Increased understanding of what "In it together” means in terms of food insecurity, community, and social and racial justice
While many of the industry-related storylines were defined by the impacts of COVID-19, our readers engaged with these three stories the most this year.
Necessity Breeds CPG Innovation During the Pandemic
Prior to the pandemic, innovation in food and beverage CPG was disruptive in terms of new products created to meet consumer demand for food and beverage experiences that pushed the frontier of established brands and products. Such innovation and disruption were generally strongest among emerging brands that catered to a changing food culture seeking a variety of distinctions that signal high quality.
Then COVID-19 descended, and innovation seemed to grind to a halt as emerging brands were forced to the sidelines and legacy brands prioritized production of existing brands to meet spikes in demand.
At The Hartman Group, we believe the essential question at this time is how companies in this moment strike the right balance between brass tacks essential operations on one hand and innovation on the other while recognizing that the latter is still an essential part of the long-term health of packaged goods firms. And so while the answer's going to be different for every food and beverage company, our bottom line is that innovation must continue during this time, particularly among packaged foods firms, and that it would be a huge mistake to totally shift all focus away from innovation.
Pandemic Accelerates Trends in Health, Wellness, Functional Foods, Cooking, and Shopping
There is a wide array of pandemic-driven consumer behaviors that have accelerated trends in place prior to COVID-19. Some of these trends were in their early days of growth and some were declining.
Online grocery shopping, for example, which, pre-pandemic, was experiencing growing pains due to general consumer disinterest in purchasing certain products online (like fresh produce). COVID-19 changed much of this, and online grocery delivery (as well as other digital grocery acquisition methods like click-and-collect) has seen dramatic upswings in use.
In terms of changing behaviors that link to diet and nutrition, the COVID-19 pandemic has intensified consumers’ ever-evolving interest in how functional foods and beverages can boost their health and wellness. Our Functional Food & Beverage and Supplements 2020 report finds that COVID-19 has accelerated trends that were already on the horizon before the pandemic, like customer preferences for organic and sustainable food. However, new issues brought on by the pandemic, like a tightening budget or an increased concern about food safety, have influenced the functional category as well. Consumers are looking to become more empowered and resilient to help propel them through this time of uncertainty. This has resulted in a stronger focus on health and wellness, which will open up new opportunities for functional products of all types.
Private Label Sales Surge During COVID-19 Stock-Up: Organic a Bright Spot
In the early stages of the COVID-19 pandemic, store brand sales outpaced national brands as consumers filled their pantries with groceries.
Organic private label sales are also a bright spot within the store brand sales surge. The Hartman Group’s Organic and Beyond 2020 report finds that trust in retailers’ organic private brands is very high today. Specifically, a great majority of consumers (83%) agree that organic private brands are just as good as organic national brands, and trust in retailers’ organic private brands is comparable to consumer trust in organic national brands. Underscoring the popularity of organic private label, 35% of organic shoppers say they are purchasing more organic private brands vs. a year ago.
“What we’ve seen over the past seven to eight years is that organic has also become a symbolizer of quality, which is really interesting because when the organic market started, and I’m going back 40 years ago or so, people typically felt like they were having to give something up in terms of organic,” said Laurie Demeritt, Hartman Group’s CEO, in her webinar presentation of the report’s highlights.
What Will Be the Big Insights in 2021?
The coronavirus will undoubtedly be the defining storyline again in 2021. Just as we’ve tracked the major and minor shifts in food and beverage culture since the onset of the pandemic in 2020, we will continue to follow this ever-evolving story into and throughout next year with four important syndicated research studies. Here’s a glimpse of what to expect next year.
Q1. Health + Wellness 2021: Assessing the Impact of COVID-19. Health + Wellness 2021 explores what’s new, what’s mainstream, and what’s around the bend in the world of health and wellness. This study will field approximately one year after consumers’ lives and lifestyles have been upended by the novel coronavirus, enabling our analysts to examine where consumers are at this phase in the pandemic crisis: which pandemic-induced behaviors will be adopted long term and which will revert back to pre-pandemic patterns.
Q2. Private Label and National Brands 2021. This study will examine the relationships that exist between perceptions of store brands and of the store itself, aspects of store brands that are particularly salient to today’s consumers, areas ready for innovation, and any evolution in the role of the store brand brought on by the tumultuous year 2020.
Q3. Sustainability & Transparency 2021. Building onto prior findings in The Hartman Group’s foundational Sustainability syndicated series, the 2021 study will both provide an update on ongoing trends and examine new sustainability-related considerations that have become important to consumers. It will provide food companies, retailers, and restaurants with key insights into what consumers are looking for now, what issues are emerging, and how they interplay with other priorities to allow consumers to fulfill their food journeys as well as live their values.
Q4. At the Dining Table: American Meals and Cooking 2021. For several decades now, Americans’ increasingly busy lifestyles have been leading them to spend more and more time eating alone or on the go and less and less time sitting down with family over traditional meals. And then came the 2020 coronavirus pandemic with its stay-at-home orders and the resulting major shift from food service meal sourcing to at-home cooking. This study will explore how this recent development has interacted with longer-term trends to shape the new mealtime.
To learn more about our syndicated research for 2021 and how to sign up early to take advantage of special pricing, contact: email@example.com