Nielsen also said that the new mantra is "if you can't eat it, you don't need it." Consumers are relying more and more on food staples and "value" items such as rice, noodles, and pasta, which dominated Nielsen's list of the fastest-growing categories in 2008.
Dollar sales vs. a year ago:
Bulk rice up 38%. Ramen noodles up 30%. Dry pasta up 25%. Margarine up 21%. Spam up 14%. Canned vegetables up 9%. Frozen vegetables up 7%. Macaroni & cheese up 7%. Noteworthy is an 8.2% increase in unit sales of canning and freezing supplies. Consumers are now growing and storing their own foods, as well as cooking from scratch rather than buying more expensive prepared "convenience" foods.
Consumers are buying more wine (7.9% increase in unit sales) and liquor (2.6% increase in unit sales).
And during these hard economic times, consumers are buying more vitamins (4.3% increase in unit sales). In fact, for most of 2008, the vitamin category was the only Health & Beauty category to grow unit sales by more than 2%. Nielsen predicts that vitamin sales will outpace other categories in 2009. As the U.S. population gets older and time-stressed families supplement less than desirable eating habits, vitamins will continue to grow unit volume, though competitive pricing may keep dollar growth lower.
The growth of organic products will slow dramatically, however. Unless organic marketers can do a more effective job of demonstrating better taste or concrete health benefits, expect the growth of UPC-coded organics to decline less than 10%.
"Going green" will be motivated more by cost-cutting than planet-saving intentions. Families on a tighter budget will be less likely to pay extra for environmentally sustainable "green" products, but they will improve the environment as a byproduct of cost-cutting strategies, such as saving money on gasoline by combining errands (lowering car emissions), and by purchasing fewer nonessential goods (producing less waste).
Consumers are shifting dollar and unit spending in favor of less expensive private-label/store brands as opposed to purchasing established name brands. Store brands hit an all-time high in unit sales and dollars at the end of 2008. Also, 48% of consumers consistently cited that they prefer larger sizes of items with lower pricing per serving over downsized products at historic price levels.
Nielsen predicts that national established brands will try aggressively to win back store brand business from consumers by using innovative packaging, unique flavors and additional health and wellness claims.
And 50% of consumers are dining out less often, while more than 30% are "trading down" to less expensive restaurants.
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