The economic effect of Covid-19 will be felt for years to come: predicted unemployment levels will rise +6.5% by the end of 2021 (Office for Budget Responsibility: Economic and Fiscal Outlook, March 2021) and, unsurprisingly, many consumers have become more price-conscious.
However, there is also a sense of cautious optimism in the air. The successful vaccine rollout and return to schools is driving 65% of consumers to feel positive about the next few months. Consumer confidence is improving, rising to 108.5 in March 2021, the highest level since August 2018, according to analysis from YouGov and the Centre for Economics and Business Research (Cebr).
Future behaviours
More consumers are now planning for the future and this is where legacy pandemic behaviours that impact the food sector have been identified.
More in-home breakfast and lunches
The pandemic has forced many consumers to rethink home versus office time. According to the AHDB and YouGov consumer tracker, 38% claim they are likely to increase the number of days they work from home (February, 2021), resulting in more breakfasts and lunches consumed at home.
During lockdown, in-home breakfast occasions grew by 22 million per week, and lunch by a staggering 101 million (Kantar Usage, 48 w/e 21 February 2021 versus average 48 w/e 22 March 2020). While these levels will not be maintained once some people return to the office, they will remain significantly elevated.
Understanding consumer needs within these in-home meals can help when trying to create a more focused offering to consumers and unlock growth opportunities.
For food producers and retailers, the opportunity lies in inspiring more in-home breakfast and lunch occasions that avoid meal fatigue, such as more interesting sandwiches, salads or wraps, for example, or breakfast options. Retailers and other foodservice establishments, particularly in suburban areas, can also entice those working from home to seek different food-to-go options to break up the working week.
More in-home restaurant-style meals
While there is evidence of pent-up consumer demand for eating out, consumers planning to visit hospitality venues once they reopen are down by 19% (CGA Consumer Confidence to Reopening, March 2021). This means more in-home meal occasions, particularly to replace meals out.
In the last year, food deliveries have boomed, offering pleasure and convenience. Consumers are also not shy about trying to replicate the OOH (out of home) experience in-home as we see cooking from scratch rise and 13% of consumers making high-quality fare using recipes or ingredients from restaurants (CGA, The Lockdown Consumer, April 2020) and recipe kits with Gousto and HelloFresh sales soaring. There are opportunities to encourage people to trade up to more premium cuts such as steaks, or to a more convenient offer.
More socialising at home
People have missed reconnecting with others and have had to adapt to the need to entertain at home during the pandemic. Around 46% are now more likely to host social events/parties (Two Ears One Mouth, April 2021). Last year saw a significant rise in BBQ occasions, albeit with fewer people. With reopening now in sight, the celebrations this year will be different, with many wanting to make them extra special.
Retailers should capitalise on this boost in at-home entertaining. Inspiration and guidance should focus on food suitable for get-togethers. Innovation is key around strong BBQ offerings, party-sized convenience products and savoury and sweet party food ranges, as well as the usual seasonal ranges.
