Download Our Top 25 Flavor Trends of 2025 Now!

August 20, 2020

How Skipping Trade Promotions During COVID-19 May Hurt Food Manufacturers Later

Tony Treadway

How Skipping Trade Promotions During COVID-19 May Hurt Food Manufacturers Later

We’ve been monitoring how food companies are reacting to the coronavirus in supermarkets since the beginning of the pandemic. While many food manufacturers are pivoting from foodservice to retail products, those whose items have been on supermarket shelves have stepped away from price discounts to promote trial. After all, why should you discount your price when retail sales records are at all-time highs? Resultingly, according to Nielsen, sales sold on promotion have reached a 4-year low. But some new analysis indicates that, while adding profit to their bottom line now, it could open the door to a big problem later.

“There is a mindset that is beginning to emerge driven by uncertainty about the economy.”

A quick check comparing the summer of 2020 to the previous year shows that 30% of food items were sold at a discounted price in 2019 compared to only 21% this year. That is fine for consumers who are trading the money they typically use for a trip to a restaurant by paying full price for premium retail items to cook at home as they shelter. But there is a mindset that is beginning to emerge driven by uncertainty about the economy.

A group of people standing on a cartDescription automatically generated
Economic worries may turn consumers away from large multi-pack purchases.

With today’s economic climate, and rising unemployment rates, consumers may have less discretionary income to work with. As a result, 78% of consumers surveyed around the globe indicate they are cutting back to save on household expenses, as measured via The Conference Board conducted in collaboration with Nielsen. In particular, families who are being most impacted by layoffs or job losses are in dire need of discount pricing.

Economic worries are expected to rise among all households as we wait for a promised vaccine that would bring the country back to a semblance of normalcy. They will likely move away from large multi-pack items found in wholesalers such as Sam’s Club and Costco and rely more heavily on products bought through e-commerce. They will also search for single pack value-priced items if the pandemic rebounds once more.

Food manufacturers should monitor their retail sales on a weekly basis to set multiple pricing, and product size, strategies that can be implemented quickly, including an increase in promotions that—at least temporarily—lowers the price. Creative Energy is helping several food manufacturers assess the changing retail environment. If you are interested in a discussion about your category and product line, let’s talk.   

MORE INSIGHTS

July 2, 2025

Is Your Website Costing You Customers?

An outdated website doesn’t just miss opportunities — it actively costs you customers. If you’ve ever felt the sting of hesitation before sharing your website, or worried visitors might leave unimpressed, it’s time to face a tough truth: your website may be working against you, and you might not even know it.

See Full Article

June 23, 2025

Thinking Above the Fold

People move quickly online and want their information even faster, so as soon as they land on your site, that invisible timer starts counting down until they decide to move on.

See Full Article

June 10, 2025

How AI Is Making Lazy Developers, And Why It Could Undermine Core Coding Skills

In the era of rapid technological evolution, artificial intelligence has become a powerful co-pilot for developers. Tools like GitHub Copilot, ChatGPT, and CodeWhisperer are speeding up development cycles, autocompleting functions, fixing bugs, and even writing entire blocks of code on command. But, while these advancements promise convenience and productivity, they also come with a quiet cost: the erosion of fundamental coding skills.

See Full Article

June 3, 2025

Office Workers Should Go Outside At Least Once A Week

A lot of office workers, and in particular those of us who spend hours at a computer, have a tendency to, if not actively avoid going outside, then at least not think too much about making a point to be outdoors.  I was intending to take a nap one recent stress-filled day, but was dragged outside instead, and I will admit that it did a lot more for my mood than a nap would have.

See Full Article