Culinology - June 2020 - 44
PETITS fours
COVID-19 disrupting
brand loyalty
Product availability has been top of mind for
consumers as food manufacturers adjust
to meet surging retail demand during the
COVID-19 pandemic. Empty shelves and
supply chain disruptions have disrupted
brand loyalty and generated increased trial
of both national branded and private label
grocery items.
As many as 65% of US consumers said
they have tried new brands after sheltering
in place became commonplace, according
to data from AlixPartners. The majority (79%)
said they did so because their usual product
was out of stock.
Substitutions have been particularly high
among fast-selling staples like meat and
protein, dairy, pasta, canned goods, frozen
foods, bread and baked products.
Price sensitivity also has been a factor.
There has been more willingness to try new
private label brands than national brands.
"One of the likely causes is that there's
usually a lower price line for private label, and
consumers have had uncertainty or direct
impacts to their incomes going through the
44 |
Culinology | JUNE 2020
current crisis," said Randy Burt, managing
director in the consumer products practice
at AlixPartners. "It's not just a stockout that's
driving that. We saw it in the great recession
in 2008 and 2009 as well."
Consumers have tried new national brands
at rates of 10% to 20% and new private label
brands at rates of 15% to 25%, according to
AlixPartners.
Signs that the shifts in consumer behavior
may continue after the crisis has ended also
have emerged.
"Consumers are suggesting that they're
going to continue and stick with the brand
they've tried at a pretty high rate," Mr. Burt
said. "Those brands that are able to stay on
shelf, that are able to deal with the spikes in
demand caused by COVID-19 and the shift
from away-from-home to food-at-home,
are the ones that are going to be able to
potentially strengthen their brands over time.
The ones that weren't able to stay in stock
have a challenge that they're going to be
facing as, hopefully, we come out and start to
get to recovery."
Culinology - June 2020
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