Circana Growth Insights

Diversity, equity, and inclusion in business has positive benefits for workers, for business results, and for people and communities engaging with these businesses. Cecilia Ogude, Circana’s senior vice president, Global Diversity, Equity, and Inclusion, breaks down the benefits and talks about what’s missing without DEI.

• Diversity doesn’t just focus on one element or group and doesn’t diminish the value of one group over another. It includes and supports everyone.
• Equity – not equality – gives everyone access to opportunities.
• Inclusion allows individuals the freedom to bring their lived experiences to their work, contributing to a rich corporate tapestry.
• Without support for DEI, businesses stand to lose a connection among employees, leading to reduced collaboration and innovation.

Some 93% of Gen Z and younger millennials are changing their behavior based on higher prices, a much higher percentage than previous generations. Stepping back for a wider view, Jonna Parker, team lead, Circana’s Fresh Foods Group, believes these younger consumers have been impacted by more trauma, from terrorism and a recession to pandemic and current inflation. Given the world they’ve grown up in, they aren’t going to become like their older counterparts. Parker and Anne-Marie Roerink, president of 210 Analytics, dive into generational differences and how retailers and brands can connect.

Highlights:

• 2024 is an inflection point where generational differences in eating, cooking, and shopping will need to be balanced.
• Retailers and brands need to recognize that older consumers still shop the separate store departments (such as butcher, dairy, and produce) while younger consumers rely more on cross-merchandising that brings different departments together for easy solutions.
• Even as butcher service counters are closing, store butchers have social currency, providing service via recommendations and tips on social media platforms.

Nearly 13% of Americans, or 17% of U.S. households, receive Supplemental Nutrition Assistance benefits, yet they represent nearly a third of total store sales. Sally Lyons Wyatt, Circana’s global executive vice president for consumer goods and foodservice insights, talks about who is winning the SNAP shopper and strategies all retailers should use to engage this valuable shopper group.

Highlights:

• SNAP shoppers represent nearly 50% of dollar store sales, and nearly 40% of convenience channel sales.
• SNAP is intended as a short-term benefit, meaning that SNAP is always new to many recipients. Retailers can help onboard shoppers and navigate the store for SNAP-eligible purchases.
• Retailers that make online search easy for SNAP shoppers will build loyalty that lasts after the benefits are no longer needed.

Moving from full-service to self-service in meat and deli departments, increasing value-added offerings in produce and deli, these are just a few examples of grocery retail’s evolution. Jonna Parker, team lead, Circana’s Fresh Foods Group, and Anne-Marie Roerink, president of 210 Analytics, advocate for learning about the most important shopper groups and meeting their changing needs.

Highlights:

• Baby boomers, long the biggest spenders, are on the cusp of being overtaken by Gen X and millennials. While it’s still important to please boomers, long-term success depends on answering the call of younger shoppers.
• Younger consumers start their shopping journey online. The key to winning store traffic is securing the shopper before they enter the store.
• While older consumers value service, younger shoppers look for relevance and experience; think solutions, not stalls.
• Low-price and fresh offerings are no longer a reason to shop a store. Point of difference and only-available-here offerings will drive traffic.

Most of the consumer tech innovation at the Consumer Electronics Show 2024 are enhancements to existing technology; think better quality audio and new capabilities. Despite lackluster levels of product innovation showcased at CES, Circana tech analyst Ben Arnold and audio analyst Ashley McCann are optimistic about opportunities in kitchen, home and audio for growth in the year ahead.

Highlights:

• While artificial intelligence was the buzzword at CES, AI hardware was harder to find. Chatbots in cars and a new keyboard function are standout examples.
• Kitchen products that speed or improve cooking and mix cocktails were on display at CES, indicating increased innovation in the small home appliance space.
• Products that support digital creators, including digital cameras and accessories, are experiencing sales growth.
• There’s still penetration opportunity, especially among older consumer, for smart home products, including security cameras and smart lighting.

Within the complex arena of marketing mix, linear TV and connected TV are viewed separately. Currently, CTV is having its moment, surpassing linear TV in return on ad spend. Circana’s Susan Kelly, solutions design, global solutions delivery and Kelly Dunham, delivery director, talk about execution and measurement of success for both approaches and the increasing value of targeting that is giving CTV its shine.

Highlights:

• Linear TV offers lower cost-per-impressions and provides a broader reach than connected TV.
• Despite the higher cost-per-impression, advertisers are realizing a better return on ad spend with the targeted audiences connected TV reaches.
• The sweet spot might be a combination of the reach of linear and the targeting audiences of CTV.
• Measurement tools determine which levers (linear TV, CTV or other marketing strategies) are driving sales lifts.
• Campaigns should be monitored mid-flight to ensure they’re connecting with the right audience, at the right time and with the right message.

The pandemic put the breaks on a lot of consumer tech innovation, so anticipation is building for CES 2024, when many companies will display their latest and greatest. Ben Arnold, Circana’s executive director, industry analyst, Consumer Technology, provides examples of innovation that go beyond tech gadgets and shares what he hopes to see at the show.

Highlights:

• From autonomous vehicles to drug discovery, artificial intelligence is making headlines. How will open-AI positively impact the daily lives of consumers?
• Virtual reality hardware has been getting updates, but new applications are possible, from warehousing to personal fitness.
• Circana research points to opportunities harness tech to empower consumers to take more control over their health.
• Pet tech has been a darling of CES in recent years, but we’re due for a new wave of innovation.
• Don’t miss Ben Arnold and Paul Gagnon’s CES presentation: Navigating Today’s Consumer Technology Market, January 8, in the West Hall, room 232, 2 pm.

Traditionally in the U.S., the day after Thanksgiving is Black Friday, which moves holiday shopping into high gear. While doorbusters have dwindled, brands and retailers work to lure shoppers with deals and experiences that set the tone for holiday sales. Circana’s Joe Derochowski, vice president and industry advisor, home and home improvement, and Ben Arnold, executive director, industry analyst, consumer technology, weigh in on Black Friday week results and discuss how their industries can claw back holiday sales.

Highlights:

• While not as bad as 2022, sales of home goods and consumer electronics were still down. The upside, gains were made compared to earlier periods of 2023.
• Different ways to shop and research is changing Black Friday traffic and extending Black Friday sales beyond a single day.
• Consumer electronics, once was a key category that brought shoppers out on Black Friday, now has to work for a share of household spend.
• Innovation is needed to reenergize the market and give consumers the new products and experiences they’re looking for.

As middle-of-the-road grocery retail continues to get squeezed, reaching consumers before they make decisions becomes critical. In this Fresh Pulse episode, Jonna Parker, team lead, Circana’s Fresh Foods Group, and Anne-Marie Roerink, president of 210 Analytics, share strategies retailers can use to highlight their points of differentiation, starting with elevating outside-the-store marketing.

• Retailers’ focus on in-store execution ignores pre-tailing, when consumers make their decisions of where to shop and what to buy, as well as post-tailing, their at-home experience with what was purchased.
• Foodservice leverages limited-time offers successfully, and it’s a great opportunity for retailers as well.
• Use heavy traffic departments, like produce and meat, to promote digital offers and encourage app adoption.

Despite a forecasted sales decline of 4% - 5% through 2024, sales of small appliances remain elevated from pre-pandemic levels. To buck the negative trend, marketers should focus equally on messaging and innovation. Joe Derochowski, Circana’s vice president and industry advisor, Home and Home Improvement, shares his secret sauce for picking holiday winners and identifying opportunities for growth throughout the year.

Highlights:

• The replacement cycle for many small appliances may shrink from the traditional five to eight years given high usage throughout the pandemic.
• The top 10 items sold January through August are a great indicator of what will sell well during the winter gifting season.
• Holiday sales are anticipated to be down 4%, but there are ways to beat that by leaning into consumer behavior, especially the value we place on time.
• The Consumer Electronics Show, coming in January, is a great way to see the advancement of “smart,” including floor care, home comfort and personal care appliances.