By Yuni Sameshima, CEO and Co-Founder, Chicory
The impact on CPG due to the coronavirus pandemic has been undeniable. For the past few months, it has been fascinating to watch canned goods and other center-of-store products experience unprecedented levels of growth — even among iconic brands that had been declining for years. Items that everyone always expected to be on the shelf suddenly weren’t, whether due to panic-buying or supply chain issues.
CPG brands are now being faced with significant planning challenges, including knowing which products need to be where and when, as states begin to reopen and as consumer shopping and consumption behavior continue to evolve. The next few months will require various scenarios for demand planning as the post-COVID-19 market continues to take shape, as well as if and when the virus begins to spike again at any point.
One of the biggest mistakes that any CPG brand can make in its planning, though, is assuming that the changes observed over the past several weeks are indicators of longer-term sales trends. As just one example, avocados, in the beginning of the pandemic, showed significant declining engagement (-48.98%) within Chicory’s shoppable recipe network, but they rebounded to show growth in the first two weeks of May (+1.84%).
Since most shoppers are now cooking more meals at home — a behavior that is predicted to stay, at least for a while, given concerns over the economy — the use of digital recipes and in-recipe advertising has also increased. These shoppable recipes allow manufacturers’ products to appear any time a recipe calls for an ingredient that is relevant to that brand’s product portfolio and make it easy for consumers to access the products they need.
By observing how millions of shoppers are interacting with different recipe ingredients, marketers can see how product trends are changing in real time and better understand how to adjust their campaigns accordingly.
Leveraging Short-Term Sales Opportunities
A canned tomatoes brand had planned an in-recipe advertising campaign to run in two flights. The first campaign flight ran in January 2020, while the second was planned for March. As the second campaign ran, the coronavirus pandemic hit the U.S. and, for weeks, drastically impacted the ways in which consumers were shopping.
Shoppers in panic-buying mode flocked to grocery stores to stock up on shelf-stable items like rice, pasta and — you guessed it — canned tomatoes.
Unsure of how changing consumer behavior would impact its sales in the longer term, the brand turned to Chicory for insights about its products’ performance in the market, and for advice on whether or not to continue its campaign amid the uncertainty.
The data showed a pronounced interest in the brand’s product, particularly when presented to consumers within recipes and in a shoppable format. As engagement and views on recipes containing canned tomatoes grew, the brand worked with Chicory to ensure that they were reaching the right customers while also offering a helpful service during such unsettling times.
The strategies paid off, as consumers responded at higher rates with 26% more products added to the digital cart during the March 2020 flight of the campaign, vs. the January flight, and found value in the on-target, helpful and contextual message from the brand.
Sometimes increased engagement with a brand in the short term is less important than developing a longer-term strategy to increase growth in a particular channel, such as e-commerce. Once the pandemic hit, so did the explosion of online grocery shopping, as 145.3% more households now order groceries online compared with those that did in August 2019.
For a spices brand, selling dried seasonings is its bread and butter, so to speak. The brand has become practically synonymous with great flavor, with its products found in most Americans’ kitchens. However, the brand wanted to grow its portfolio and introduced a line of semifresh seasoning products that were found in refrigerated produce aisles.
After a successful first test with Chicory, which demonstrated that consumers had strong follow-through with adding products to their carts after clicking on a shoppable ad, the brand sought to build on that momentum with another shoppable campaign. With the coronavirus pandemic gripping the nation, the ability to build baskets online became even more important, allowing the brand to withstand changing consumer behavior and demand as shoppers made fewer trips to grocery stores, opting for either delivery or click and collect.
The brand’s herbs and spices were advertised within recipes that trended among consumers cooking at home and were made shoppable with Chicory’s Click-to-Cart technology. As recipe usage within Chicory’s shoppable recipe network surged 114%, levels that exceeded even Thanksgiving, in Q1 year-over-year, the brand was able to help consumers more easily find delivery-friendly, fresh flavor solutions. Consumers responded too, with over $67,000 added to retailer carts during the monthlong activation.
It’s vital for CPG brands and retailers to understand how consumers will continue to shop for food products and ingredients online as stay-at-home orders are lifted, and how they will adjust to the new shopping habits they have learned while hunkering down. This may mean making fewer trips to the store and buying more while there, shopping more online, continuing to cook more at home, tightening food budgets and ensuring their pantries are stocked in advance of the virus potentially spiking again.
By observing the trends in how consumers use content like recipes, marketers can get new insights that can be immediately applied to their campaigns. In an era that may seem unpredictable, you can still take the reins and steer them closer to growth.
Learn more about Chicory at chicory.co.