2021 Trends & Emerging Growth Pockets [REPORT]

U.S. consumers are resuming active lifestyles as we emerge from the pandemic while maintaining some at-home habits, such as eating more meals at home. While CPG demand has remained elevated in the first half of 2021, IRI expects demand patterns to shift as the reopening economy reignites competition for consumers’ wallets.

This report highlights key 2021 trends to watch and identifies the biggest emerging growth pockets for CPG. In this rapidly shifting environment, manufacturers and retailers that excel at detecting shifts in consumer needs and react with agility will be best positioned for growth.
Observations:

•     Younger and higher-income households are making more small trips to non-grocery channels as mobility increases. Low-income households continue to spend more for home consumption.
•     Highly elevated consumption of frozen foods and baking ingredients is reverting but still above the norm; cosmetics are recovering yet remain below pre-pandemic sales levels.
•     Consumers continue to buy premium products. As shelf price increases continue, expect increasing trade-off versus product value as prices creep up. Store brands are likely to rebound and gain market share in the second half as national brands raise prices.
•     As consumers become more comfortable returning to stores, many shoppers will stick with online options, behavior that will continue to drive omnichannel sales.

Opportunities:

•     As significant price increases occur, manufacturers and retailers will need granular revenue management strategies such as net price realization, truly incremental promotions and price-pack-channel range architecture to drive profitable growth.
•     CPG companies cutting media budgets should optimize media ROI real-time and focus on the right products and vehicles, and on the segments and audiences that are most responsive to media to minimize share loss.
•     Retailers and manufacturers must continue to invest in online platforms to retain omnichannel shoppers while carefully curating distinct online versus in-store experiences.
•     Brands should communicate and innovate incrementally on attributes and benefits that matter to the shopper, simplify their shelf sets and focus on winning retailers, categories, brands and channels for growth.

This report highlights these and other trends and emerging pockets of demand for CPG that retailers and manufacturers can leverage for growth as the economy reopens and consumer behavior continues to evolve.

To download report, CLICK HERE.