By Sally Lyons Wyatt, IRI
There weren't many bright spots in 2020, but one thing that did spark joy for many consumers was snacking! Whether they reached for a tried-and-true classic like potato chips or explored a new flavor of ice cream bar, consumers' urge to snack more frequently surged in 2020 (and yes, stress about the virus and having to stay home certainly played a big part). In fact, according to IRI data, there was a 79% increase in core snacking categories last year. That's a lot of snacks!
During IRI's annual snacking webinar, I took a deep dive into how the variety of 2020 snacking occasions impacted purchase dynamics; what role baking is playing in snacking; how different generations are snacking; which new flavor combinations are popular with consumers; how health concerns impact consumer choices; and what new innovations hit the shelves and resonated with consumers.
Our data shows that 25% of consumers reported snacking more frequently in 2020 (up five points from 2016), while 23% said they were snacking less frequently (no change versus 2016). On average, consumers were eating a standard 2.7 snacks per day. However, more consumers reported consuming more than five snacks per day, increasing three points from 2016.
Growth came from both e-commerce and brick-and-mortar platforms, but online sales shifted four share points from in-store. Retailers and manufacturers wanting to capture shoppers' attention and dollars will need to implement a series of strategies and tactics, both in and out of the store – because while the path to purchase may have shifted for consumers in 2020, some habits, such as writing lists and searching for the best deal, still play an important part in their decision making.
Ten Action Steps to Grow Your Snack Brand
You've seen the reports that food and beverage sales are expected to stagnate or decline this year and beyond, due to the explosive growth we saw in 2020. However, due to several factors (including a three to four-point pricing gain), the snack category is forecasted to grow 3% to 4% in 2021. By implementing the following actions, CPG retailers and manufacturers can more easily capture a share of that growth:
- Continuously monitor the role your snack plays with your consumer, as well as in your competitive set. It's not enough to use gut instinct; get the most precise picture by looking at data to understand what else your consumers are purchasing when they buy your products.
- Ensure that each brand's role in your portfolio provides incrementality in meeting consumer targets, occasions or nutritional needs. Drive incrementality by offering complementary products and products that target different consumers and occasions.
- Inform your marketing and sales strategies based on the four key drivers that determine how consumers purchase and consume snacks. These purchase drivers refer to planned, impulse, experiential and on-demand purchasing.
- Use social media and digital marketing to inform your consumers about your personalized solutions and variety, such as flavors and pack sizes. Social media and digital marketing can offer the biggest bang for the smallest investment (compared to traditional marketing channels, like television).
- Attract, retain and gain consumers in- and out-of-home by offering them unique experiences. While most consumers were forced inside in 2020, 2021 is already finding them getting out of the house more.
- Collaborate with retailers to execute assortments and variety to address this mobility as well as at-home occasions. Many manufacturers opted for larger sizes in 2020, but finding a balance between small and large pack sizes will be imperative as consumers are already becoming much more mobile this year.
- Understand the effect that pricing and promotion have on specific shopper segments to drive penetration and incremental revenue. Consumers had a wide range of financial experiences in 2020, such as with job stability, and are still watching their wallets. Retailers and manufacturers will need to take this into account.
- Drive consumers online and in the store by leveraging paid search, social media and shopping apps. You can use these vehicles to share key messages and innovation, such as your sustainability practices and new product attributes.
- Determine the right pack-size architecture for your products. This is one of the most essential strategies for every manufacturer right now. Focus your innovation efforts on the attributes and wellness benefits that matter to your most valuable consumers and offer those products in packs tailored to the channel where they're being sold.
- Leverage sustainability where relevant. Sustainably marketed products are winning and will continue to win. Use personalization to talk with consumers about the specific assets of your product that align with their needs, focusing on your company's or brand's sustainability practices.
Mobility, pricing and other factors are obviously going to play a big part in what we see this year for snacking performance. These steps will help you stay on top of the changes and capture your fair share of growth for your brand in 2021.
To learn more, reach out to your IRI representative or IRI@IRIworldwide.com for more info.