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IRI Consumer Connect Survey: CPG Non-Edible Sales Trends Mixed

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Consumer confidence peaked in the second quarter of 2019, but spending is down and saving is up, according to the latest IRI Consumer Connect Survey results. Even though 56 percent of consumers say their financial health is good, CPG unit sales were flat or down and the non-food sector is struggling as well.

To examine how consumers’ shopping behaviors and attitudes are affecting non-edibles, IRI also released a new report, “Consumer Confidence Impacts Non-Food Sales.”

“Given the strong GDP, record unemployment and even steady inflation, consumers are feeling very confident,” said Joan Driggs, VP of content and thought leadership at IRI. “However, when we look at consumer behavior, it’s as if they’re waiting for a shoe to drop. They are saving more and curbing spending on non-edible products, such as beauty and personal care.”

The Consumer Connect Index, which monitors consumers’ financial health and CPG behaviors for factors such as brand loyalty, attitudes toward organic/natural food and beverages, perception of national compared to store brands and frequency of using retailers’ and manufacturers’ coupons, is above 100 for Q2 2019, the highest since the Consumer Connect survey was launched in Q1 2016. Consumers report they are saving more in 2019 (42 percent) compared to a year ago (39 percent). Sixty percent of households earning $100,000 or more say their savings have grown in the past six months. The rate of increased savings is fairly consistent across all generations.

Non-edible unit sales were flat or down for Q2 2019, while dollar sales were a healthy 2.9 percent in April, softening to 1.2 percent in June. Spending on national brand non-edible products continues to outpace spending on private label non-edible products. Yet, buying private label products remains the top strategy consumers use for saving money—80 percent in Q2 2019, down from 84 percent in the same period of 2018.

General merchandise, health care and home care monthly dollar sales grew in Q2 2019, while beauty is flat and tobacco sales are down. Deal seeking in beauty and personal care is most prevalent among less wealthy shoppers, millennials and Generation X.

More than one-third of consumers report they are willing to pay a premium for products marketed as sustainable, an increase of two percentage points from a year earlier. While Millennials are the generation most willing to pay a premium, sustainability attributes resonate with shoppers across all household income groups. Millennials also seek products made with natural ingredients and are the most likely to report avoiding products with ingredients they don’t want, such as parabens, artificial colors and sodium lauryl sulfates.

“We anticipate that shoppers will gravitate toward premium private brand beauty and personal care products, such as those available at Ulta and Sephora,” added Driggs. “Thirty percent of shoppers expect to purchase more premium brands in the coming months, but private label options remain the top strategy for saving money. It’s these specialty retailers, which also offer elevated levels of service, that are best positioned to offer shoppers premium private brand options.”

IRI provides new survey results at the end of each calendar quarter covering shoppers’ behaviors and attitudes as they directly relate to their strategies for learning about, purchasing and utilizing CPG and health care products, as well as information regarding perceptions of economic conditions and their ability to provide for their families. For more information about customizing the research for a particular category or industry, contact [email protected]

About the author

Lorrie Griffith

An observer of the grocery industry since 1988. Away from her editor job, she's a wife and mother of two grown sons and thinks cooking is (usually) relaxing.

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