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Years’ worth of changes reshaped the consumer marketplace in 2020 and into the early months of 2021, with seismic shifts in the way people live and work at home and buy products for themselves and their families. Innovations in products can meet the demands of today’s home-centric consumers and open the door for new growth for brands and retailers in the post-pandemic world.
Innovation for a Post-Pandemic World
IRI Insights:
Discovering Pockets of Demand
As consumers pivoted to working and working out at home, they have increased their at-home consumption across many categories. Going forward in the new normal, many who are working from home will continue to do so, at least part of the time.
Innovation Trends
The Great Reset
Home Base Covers All the Bases
Better Now
In addition to consuming products for their needs — including food and beverages, household goods and personal care items — consumers have upgraded their homes inside and out, especially digitally.
Sales of convenient kitchen appliances like air fryers and cocktail makers rose during COVID-19
The Kitchen is the Heart and Hub of the Home
Screens were the source of entertainment for much of pandemic, including streaming services and gaming. Screen-time snacking has increased.
New Entertainment and Holiday Celebrations
Assortments on shelf, including periodic out-of-stocks, led to brand switching that impacts long-term brand loyalty
Beware New Buying Behaviors
say they used the search tool
Current key influencers of new product trial:
A Trio of Trending Areas
Self-care/societal care attributes are growing faster, including product origin, targeted diets, immunity benefits and more.
Those who produce and sell food can leverage existing home-centric trends and turn them into opportunities. Innovations can and should focus on the continuing themes of self-care/societal care, indulgence and convenience. These themes are part of consumer lifestyle shifts that will have lasting impact.
Innovation Opportunities
Pockets of demand fuel innovation
Self-care/ societal care
• Expands to include personal, pet, home, society and the planet
Product examples include:
• Nutritional supplements
• Self-care products that support other wellness efforts
• Sustainable, renewable, and refillable packaging
• Home care products that sanitize over longer periods of time.
• Water conservation in personal and home care products.
• Pet innovation supporting post-pandemic pet and pet-parent adjustments
• Limited time offers drive variety in indulgent products
• More permissible indulgence with focus on diet and health
• Premium private label as a point of differentiation, especially for meal components
• Customizable celebration kits for various occasions
• Indulgent treats, smaller portions for smaller celebrations/ households
• Home spa products for consumers of all ages
• Retail-driven ingredient bars for quick, fresh meal solutions
• Meal kits of prepared foods for in-store and delivery
• New support for meal solutions from products in-store, via retailer apps, shoppable recipes
• Products designed for convenient kitchen appliances
• New e-commerce product discovery for easier and appealing shopping
Out-of-stocks opened up opportunities for smaller manufacturers
Who’s Who
Shoppers will pay a premium for genuine benefits communicated to them
Messaging matters
Craft careful, targeted messages
Implementing Innovation
about IRI’s report, “Innovation for a Post-Pandemic World," the latest in IRI’s ongoing series of reports on navigating a path forward through and past COVID-19 — or customize research by category or industry by emailing IRI@IRIworldwide.com.
Re-introduced — or just plain introduced — to the kitchen during the pandemic, consumers cooked and prepared most meals at home
CPGs responded with meal kits for convenient appliances, such as products for instant pots
Retailers served needs by providing meal kits and teaming up with local restaurants
Post-COVID, 53% of consumers say they will continue to make meals from scratch
59%
35%
32%
29%
How consumers shop online:
checked for sales items before deciding
used category menus
accessed and reordered from list of pre-purchased items
Shoppers are searching in-store less often and online more frequently
Different factors now drive product trial
80%
Use of coupons from home have declined:
recipes
previous usage/
trust in brand
42%
Use of newspaper circulars from home also dipped:
47%
55%
in 2021
in 2019
in 2021
in 2019
25%
34%
vs.
vs.
Indulgence includes premiumization of products and permissible indulgence, as consumers balance health and wellness and comfort and satisfaction.
Shopper Loyalty Index to Product Attributes Pre- & During COVID-19
Example: Shoppers Prefer Self-Care Benefits
Immunity
Multi-Benefit
Heart Health
Prenatal
Anti-Inflammatory
194
227
201
227
165
173
164
155
150
140
vitamins & supplements
Pre-COVID-19
During COVID-19
Convenience is amplified, with new flavors and habits from cooking at home expected to continue into a post-pandemic world.
Indulgence
Convenience
Private Label
Extra Small ($<100M)
Small ($>100M)
Medium ($>1B)
Large ($>6B)
16.0
8.8
12.6
17.9
44.9
18.0
14.4
16.4
33.4
17.6
2020 Share
Contribution to Growth
2020%
chg. vs. YA
10.4%
2020 Abs chg. vs. YA ($B) $88B
11.9%
$16B
18.3%
$13B
15.4%
$16B
9.5%
$14B
7.5%
$29B
Smaller brands drove as much market growth as larger players last year and will continue to be a force
$933B
100%
Share PPT Change vs. YA
% Share of Total store sales by CPG manufacturer size MULO+C, 52 weeks ending 12/27/20
Out-of-stocks widened the door for smaller manufacturers, who drove as much market growth as large players in 2020
+$29B
Spot evolving trends
Test/validate against consumer preferences
Innovate with products using desired attributes and define which benefits consumers will pay for
Make searches easy
The right messages boost product equity and enable optimal pricing
Better-for-you claims, including organic, non-GMO and no artificial ingredients, can carry price 2%-5% vs. mainstream alternatives.
Multiple claims that also include organic and no artificial ingredients convey premium quality and command a premium price — ~25% vs. mainstream alternatives
Celebrations for special occasions and holidays also changed, with potential longer-term implications.
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+33
+26
+8
-10
-9
Self-care/ societal care
Indulgence
Convenience
• Expands to include personal, pet, home society and the planet
Product examples include:
• Nutritional supplements
• Self-care products that support other wellness efforts
• Sustainable, renewable, and refillable packaging
• Home care products that sanitize over longer periods of time.
• Water conservation in personal and home care products.
• Pet innovation supporting post-pandemic pet and pet-parent adjustments
• Limited time offers drive variety in indulgent products.
• More permissible indulgence with focus on diet and health
• Premium private label as a point of differentiation, especially for meal components
• Customizable celebration kits for various occasions
• Indulgent treats smaller portions for smaller celebrations/ households
• Home spa products for consumers of all ages
• Retail-driven ingredient bars for quick, fresh meal solutions
• Meal kits of prepared foods for in-store and delivery
• New support for meal solutions from products in-store, via retailer apps, shoppable recipes
• Products designed for convenient kitchen appliances
• New e-commerce product discovery for easier and appealing shopping
Several small manufacturers capitalized on COVID-19 induced demand spike
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