SnapPulse Insights: Food Category (till Mid-April 2020)

A deep-dive into the impact of lockdown on food categories – till Mid-April 2020.

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The category spiked in shopper baskets and showed a very sharp increase in share of spend in the basket when lockdown was imminent and then has started to settle. This indicates some amount of increased / advanced buying during this period. However, the presence in shopper baskets indexes much higher than presence in stores from the start of lockdown due to possible supply issues. The prices paid and quantities bought have largely moved in tandem but there is no evidence of price rises or customers having to buy more expensive alternatives.

 

The share of spend for the above category in shopper baskets climbed relatively early on and then there was an increase in both shopper baskets and share of spends right up till the start of the lockdown. This indicated some amount of increased / advanced buying.  Thereafter, we see a sharp fall coupled with less presence in stores indicating possible supply issues as the presence in shopper baskets continues to index high. The prices paid and quantities bought have largely moved in tandem so there is no evidence of price rises or customers having to buy more expensive alternatives.

 

Presence in shopper baskets and share of spend for the above category rose rapidly when lockdown was imminent but since then they have fallen but they still remain high. This indicates that there is still some amount of increased / advanced buying. However, we see a sharp fall in presence in stores post the start of the lockdown mostly due to supply issues (since presence in shopper baskets continues to index high). The prices paid and quantities bought have largely moved in tandem so there is no evidence of price rises or customers having to buy more expensive alternatives.

 

The presence in shopper baskets and share of spend on the category spiked when lockdown was imminent and then tumbled towards the beginning of April. This fall coupled with the fall in presence in stores at the same time indicates possible supply issues (post the period of increased / advanced buying) due to continued high presence in shopper baskets. The prices paid and quantities bought have largely moved in tandem which indicates that there is no evidence of price rises or customers having to buy more expensive alternatives.

 

Cooking Oil category spiked in shopper baskets when the lockdown looked imminent. While share of spend on the category increased, it was not as sharp which indicates some amount of increased / advanced buying that appeared to settle towards the beginning of April. However, the presence of cooking oil in shopper baskets indexes a lot higher than presence in stores at this time, indicating possible supply issues. The prices paid and quantities bought have largely moved in tandem. However we see a sharp drop in quantity bought 2nd week of April but no corresponding drop in price. Therefore, the customers are buying smaller quantities at higher prices either because they are buying more expensive brands (availability / retailer push) or the selling prices have increased.

 

The presence in shopper baskets and share of spend rose when lockdown was imminent and then fell very sharply in the beginning of April, along with a sharp fall in presence in stores. There is clear evidence of increased / advanced buying when lockdown was imminent. However, salt is a commodity that is not used in very large quantities like staples. We see that presence in shopper baskets, share of spends and presence in stores have all fallen to similar levels by April beginning. Therefore, it is possible that the buying has just settled down post the earlier increased / advanced buying. The prices paid and quantities bought have largely moved in tandem but there is no evidence of price rises or customers having to buy more expensive alternatives.

 

The presence in shopper baskets and share of spend for this category rose sharply when lockdown was imminent and fell by beginning of April but look set to climb again. There is clear evidence of increased / advanced buying when lockdown was imminent. Also, the stores seem to have supply issues in April given that the presence in shopper baskets indexes so much higher than presence in stores. The prices paid and quantities bought have largely moved in tandem so there is no evidence of price rises or customers having to buy more expensive alternatives.

 

The category spiked in shopper baskets, imminent to lockdown and the share of spend on the category increased tremendously. This indicates increased / advanced buying and could also be because of the increased presence of the children at home. However, we see a stable / falling presence in stores indicating possible supply issues since the presence in shopper baskets continues to index high. Though we see increase in quantity bought post the lockdown, the price indexed higher than quantity bought – indicating either price increases or choosing of more expensive options (availability / retailer push related).

 

The category spiked in shopper baskets just before lockdown kicked in and continues to remain high as families, especially children and elderly, are at home. The share of spend, though high, has also dropped towards the beginning of April as the shoppers are possibly looking for alternatives and spending less on bread and baked goods, in their shopping baskets. It could also be owing to supply / availability issues as there is a sharp fall in presence in stores which is indexing lower than presence in shopper baskets. The price has been indexing higher than quantities quite consistently – this indicates that there have been price increases, and/or customers are buying more expensive alternatives given the availability/retailer push.

 

The category spiked in shopper baskets just before lockdown kicked in and continues to remain high as families, especially children, are at home – this also indicates possible increased / advanced buying. The share of spend has dropped towards beginning of April indicating possible adequate stocks at home and movement to other items in the shopping basket. However there is a sharp fall in presence in stores indicating supply issues given that the category still indexes high in shopper baskets. The price and quantity were moving in tandem quite consistently but price paid for biscuits in a basket rose 9.5X the usual when lockdown was imminent. The presence of kids at home and imminent lockdown (demand) / availability / possible retailer push seem to have pushed customers into buying a lot of more expensive options than they usually would have.

The category spiked in shopper baskets and share of spend imminent to lockdown indicating increased / advanced buying (and also spurred by the increased presence of children at home). We see a drop towards beginning March but a pick-up in April 2nd week indicates that we will have to watch further. Presence in stores has been dropping sharply since end March indicating supply issues as presence in shopper baskets continues to index at a higher level. Price and quantity were moving in tandem quite consistently but price paid has indexed higher than quantity March end and April beginning indicating price increases and / or customers buying more expensive options either out of choice (kid’s demand) or availability or retailer push.

Packaged water has got impacted in the period immediately and after the lockdown. Both supply (indicated by presence in stores) and demand (indicated by presence in baskets) seem to have slumped post lockdown indicating possible reduction in consumption by households (who may be moving towards purification at home, hence water takes a lower share of spend) and also, no sales to non-household customers (tea shops and small eateries) all of which are closed. There is definite evidence of a price rise – price is indexing higher than quantity from April onwards which could be supply or purchase led, with whatever is being bought, being bought at higher prices / more expensive options than usual either because of availability or retailer push.

 

The presence in shopper baskets increased and we see a high share of spend on fresh milk between March 2nd and 4th weeks. This possibly reflects disruptions in supply of milk to homes. Also, it is possible more family members (especially kids) were at home, and there were festivals which increased the demand for milk (which home delivery was not able to meet). The presence in stores has fallen with the lowered presence in baskets and there is no evidence of supply issues. However, prices index higher than quantities March 3rd and 4th weeks showing a possible price increase linked to the festival demand, and / or customers were buying more expensive alternatives (e.g. higher fat milk than usual).

 

Though tea’s presence in shopper baskets shot up when lockdown was imminent (a week prior), the share of spend on tea in the shopping basket went up to 3.5 times the usual level in Delhi NCR. This happened a week ahead of the category shooting up in shopper baskets; it indicates some unusual activity at the kiranas – possibly a few bulk buyers buying at higher than usual prices and later supplying to areas outside Delhi.

The presence in shopper baskets fell rapidly thereafter while the presence in stores fell too. It appears to be a brief period of increased / advanced buying followed by movement of spends away from tea and onto other categories. The prices seem to have crashed mid-March onwards, with falling demand / flooding of stocks (due to lack of export). The fewer baskets and lower priced items have resulted in lowering share of spend too.

 

In the West, the tea’s presence in shopper baskets shot up when lockdown was imminent, indicating some amount of increased / advanced buying. The share of spend is not very high, and has fallen very sharply from middle of March and into April. There was a sharp price rise March 2nd week, after which prices and quantities have moved in tandem. The share of spend on tea seems to have moved away to other items in the shopper basket. However, the steadily lower presence in stores, rising price and quantity could indicate the start of a supply issue as tea gardens and auctions are affected owing to lockdown.

 

In the South, coffee category peaked in shopper baskets between March 2nd to 4th weeks and then has tumbled sharply in April. As presence in stores has not dropped that sharply, there does not seem any supply issues but a reflection of falling demand. The share of spend has been unusually high which indicates increased / advanced buying. However, coffee is one item that has proven to be linked to recession (purchase and consumption falls at the first indication of recession) and we see that happening with demand falling sharply. Prices have crashed in line with falling demand. The customers who still purchase are taking advantage of higher quantities at lower price and / or buying higher amounts of cheaper alternatives to what they usually buy.

We have been closely studying various food and non-food categories and analysing the performance of various FMCG brands from these categories during the lockdown. If there are any categories or brands you would like us to deep-dive into, please write to us at vinay.s@snapbizz.com and we will be happy to share them with you.