Oreos and Hot Pockets are having a coronavirus moment, as millions worldwide burrow at home on lockdown and reach for old standbys.
With the Covid-19 pandemic upending regular habits, homebound consumers are snapping up frozen food and snacks as convenience and comfort trump freshness and low calories.
Google search interest for “potato chips” has surged as consumers stuck at home look for snacks to fuel their Netflix binge. Cookies and other treats are similarly seeing an increase in demand, boosting the first quarter results of snack-makers like Mondelez and PepsiCo, both of which beat Wall Street estimates.
This picture of sweatpants-clad consumers munching on cookies or slurping on instant noodles stands in contrast to the pickup in consumption of healthy foods like avocados and orange juice or the newly sparked frenzy for bread-baking, at least as documented on Instagram and other social media.
Dirk Van de Put, CEO of Mondelez, which makes Oreo and Chips Ahoy! cookies as well as Cadbury chocolate, commented on their earnings call last week that consumers are snacking more as they are “looking for that moment of comfort offered by biscuits and chocolate in today’s stressful circumstances.”
The stockpiling of convenience foods such as Hot Pockets frozen meals and Maggi instant noodles also helped contribute to brand owner Nestle’s strong first quarter results, where it recorded its fastest quarterly sales growth in nearly five years.
A similar trend has also emerged in China, where sales of prepacked instant hot pots surged after the coronavirus rendered communal hot pot meals a thing of the past. With greater caution around hygiene and shifting preferences toward eating more meals at home, instant hot pots have become even more of a hot item in the first quarter of the year. The estimated market size for instant hot pots was 4.5 billion yuan in 2018.
Will this shift toward comfort and convenience foods last after the world emerges from the Covid-19 pandemic? Or would consumers go back to their prior consumption habits?
Two factors may be worth keeping an eye on, the first being the economy. In the past six weeks, over 30 million Americans have filed for unemployment insurance as layoffs sparked by the pandemic continue.
The economic downturn may prompt consumers to be more cautious with their spending and embrace cheaper options. As Hershey CEO Michele Buck put it, in the most recent quarter, the company has seen a shift to “lower price per ounce offerings” as consumers experienced financial constraints.
Another factor would be whether consumers’ perceptions of these foods have shifted for the better.
Some experts argue that some consumers may be surprised by the quality improvements for these products, which may encourage them to come back for more even after quarantine measures ease.
One thing’s for sure — the pandemic has changed many aspects of daily life, including how people eat.