Would food shoppers rather not use online ordering? (KR)
Inspire PR Group and Illuminology released the results of their survey on “How COVID-19 will change consumer engagement with food.” The study found that more than one-third of recently acquired customers are unlikely to use an online pickup, and nearly half are unlikely to use online delivery when restrictions are lifted. Other results include:
- Stockpiling extra nonperishable foods and household supplies is likely to continue, with four in 10 respondents saying they are very likely to buy and store these items after stay-at-home restrictions are lifted.
- Consumers are fearful of other shoppers, making them ill. Approximately 23% of shoppers most prefer that customers wear face masks, and 18% prefer that the number of customers in the store is limited.
- When the shelter-in-place restrictions are lifted, in-store visits will increase, but online shopping will decrease or remain flat.
It’s not a surprise that so many consumers would say they would return to shopping for food when the pandemic ends, but there are a number of consumers who are trialing online ordering and delivery that otherwise would not have. Because of the suddenness of the demand for online delivery, the offering has not been able to keep up to the service levels pre-COVID-19. With the infrastructure being rapidly expanded, the online share shift has been accelerated, and food and grocery companies will have to adapt to how customers shop online. There may be a re-settling of share between online and traditional brick & mortar food shopping when the pandemic ends, but there’s likely no looking back to pre-COVID-19 levels. The survey polled 1,800 between April 17-20.
Loblaw (L CN) reports elevated food sales trends in Canada
Canada’s largest food retailer reported Q1 results yesterday. Q1 food retail SSS increased by 9.6%. Price was 1.5% vs. national food price inflation of 2.8% (the US $ exchange rate has a significant impact on food inflation in Canada). Its pharmacy SSS were up 10.7% and was similar between pharmacy and front end. The sales surge in Canada was in the two weeks from March 8 through March 21 when customer traffic and basket size increased by four-fold. EPS grew 24% YOY to C$.97 and was $.04 above consensus expectations. In the five weeks since the end of Q1, food retail SSS was up 10% while drug retail SSS was down 6%. Management estimates that the increased spend to operate safely in the COVID-19 environment has an additional cost of $90M per month. Management said customers are visiting less often, purchasing more, favoring one-stop stores (Loblaws grocery stores are outperforming its superstores), and are less price-sensitive. Online sales tripled from LSD%.
Consumers are in no rush to visit craft beer taprooms (SAM)
Georgia became one of the first states to lift its social distancing restrictions this week. Atlanta based Monday Night Brewing conducted a survey to gauge consumer sentiment and found that 75% of drinkers do not expect to visit a bar until June at the earliest. Almost 22% of respondents said they planned to return to visiting bars in July; 13.4% predicted it would be August or later before they returned to a brewery for a pint. One hopeful sign for craft breweries was that 72% of respondents said they plan to visit brewery taprooms with the same frequency or more than they did before the COVID-19 pandemic struck. Consumer surveys certainly indicate a shallow V recovery at this point in the pandemic. Seven hundred forty consumers participated in the survey between April 23 and 24.
