6 Global Trends Accelerated During the Pandemic

By: Núria Moreno 
 

Greater freedom to explore the outside world post lockdown has seen the value of snacks and drinks sales out of home (OOH) rise 49% around the world (Q2 2021 vs Q2 2020), while in-home consumption has retained its lockdown gains. The increasing consumption of snacks and drinks out of the home has enabled the OOH market to record 12% growth year-on-year in Q2, the first quarter with growth for the total industry.


Analysis of the Worldpanel Division’s OOH FMCG panels around the world found that Q2 2021 saw a stunning rebound, with total quarterly sales of $30.7bn. The recovery from the extreme lockdowns in Q2 2020, which more than halved OOH consumption globally, has been led by European markets. Markets such as the UK and Spain have seen OOH value grow by 176% and 147% respectively.

Despite these rises, OOH consumption still has not returned to its pre-pandemic share of the total market. The only market where OOH numbers are higher is China, where OOH consumption is now 49% of the total market, compared to 47% in the same quarter of 2019. Taking China and Europe as a reference, we should expect that OOH will go back to pre-pandemic levels globally soon after restrictions are fully relaxed, but with a different structure of occasions and channels, companies should revisit the brand and channel strategy for this industry to make sure that the new consumer demands are met.

One of the few winners of the pandemic has been ecommerce. Ecommerce remains the fastest-growing channel in 2021 for in-home grocery shopping. Although in the last quarters, ecommerce is not accelerating anymore, we expect that online shopping will remain 50% higher than pre-pandemic levels. Manufacturers and retailers will need to adapt their portfolios and promotions in a more competitive environment compared to traditional offline shopping.

Consumers have maintained their total number of eating and drinking occasions during the last 18 months despite spending more time at home. They dropped out-of-home in favor of in-home due to lockdowns and restrictions, but we can assume that we are loyal to our habits independently of the surrounding circumstances, and so, we can expect to go back to pre-pandemic habits soon, once restrictions are eased with a few exceptions; and working from home is probably the most relevant one.

Treating ourselves and recreating the OOH experience drove first lockdown habits. As lockdowns were extended, we reduced the amount of baking, snacking and desserts, and we kept the extra occasions connected to OOH, especially through breakfast, delivery and drinks. As OOH makes a full recovery and restrictions are lifted, we can anticipate that some of these behaviors will fade. Our prediction is that the majority of meal occasions that migrated to in-home will return to OOH by Q1 2022, if restrictions are eased.

Snacking habits change substantially across regions and consumer motivations can be very different, but enjoyment is generally the first reason for snack consumption and this is especially the case in countries such as France, the UK, Mexico and Spain.

Once restrictions are relaxed, we expect healthy snacking will become more important again, and we already spot signs. We can see an example in the UK; between March and July (the first UK lockdown) consumers were clearly deprioritizing health, but once restrictions eased from October to December, health as a reason for consumption grew again, especially positive health drivers such as “health benefits”, “more natural”, “provide a varied diet”.

Health will always be relevant in our snacking choices, but that concept is likely to change. We can expect consumers to continue shifting from simply managing their health to a more wellbeing led approach as we observe in US, where beverage occasions have shifted to wider concepts like the healthiest choice possible, to feel good, or trust, rather than managed health needs such as low-carb or low-fat.

Together with ecommerce, meal delivery has been one of the biggest winners during this pandemic, accelerating the already fast-growing trend before COVID-19 started. We have learned that it is more of a competitor for cooking at home than for eating out.

Unsurprisingly, after being in and out of lockdowns, consumers are looking forward to going back to on-premise. Over 70% of consumers in China, France, Portugal, Spain and the UK said that meal delivery will never replace going out to a restaurant.

COVID-19 may have moved the topic of sustainability out of the top news recently, but its importance in terms of the global population only continues to grow. We examined the impact of the pandemic issues in our 3rd edition of Who Cares, Who Does? Global report ran in 26 countries.

Almost half of all shoppers think it is now more important, with 17% thinking it is much more important, and only 7% thinking it is less important.

Eco-Actives are shoppers who are highly concerned about the environment and make the most effort to reduce their waste. They feel an intrinsic responsibility to be more sustainable, follow the topic more actively, and have a greater awareness. Currently, they represent 22% of global FMCG shoppers, and we predict Eco-Actives will account for half the population by 2030.

85% of shoppers intend to reduce their carbon footprint in at least one way, the most likely to be packaging related, i.e., buying more sustainable packaging and using refillable or re-usable products.

These 6 trends were part of consumer reality before COVID-19, but they have accelerated as a result of the pandemic and will stay in the post-pandemic world. Any player in the snacks and drinks industry will need to revisit strategic priorities to convert them into opportunities.