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03/11/2021

Changed Shopper Habits Will Spur CPG Demand After COVID-19

Report outlines 5 transformative trends
Bridget Goldschmidt
Managing Editor
Bridget Goldschmidt profile picture
Changed Shopper Habits Will Spur CPG Demand After COVID-19 Consumer Brands Association
Demand for consumer packaged goods will slow from the extreme highs seen during the height of the pandemic, but will remain above pre-COVID norms, even as vaccines become easily available.

The Consumer Brands Association has issued a new report discussing five trends that will shape the future of the consumer packaged goods (CPG) industry. According to “The CPG Post-Pandemic Outlook: Five Trends Emerging from COVID-19 That Will Redefine the Industry,” demand for consumer packaged goods will slow from the extreme highs seen during the height of the pandemic, but will remain above pre-COVID norms, even as vaccines become easily available.

Although Consumer Brands anticipates that 2021 CPG purchases will decelerate between 1% and 2% from last year’s levels, the expected annual rate of purchases is predicted to grow by 7.4 to 8.5% compared with 2019 levels, pointing to a fundamental shift for the industry.

“Over the last year, the CPG industry has met unprecedented demand by being unafraid to change the game,” noted Consumer Brands President and CEO Geoff Freeman. “There is no ‘normal’ to which the industry will return — urgent transformation is the only way forward. From elevated demand to supply chain to managing waste, everything about the consumer packaged goods industry is in the midst of dramatic change and capitalizing on enormous opportunities.”

The report includes a Consumer Brands Association/Ipsos poll of 1,008 American adults that found the return to relative normality will be gradual. Asked when they would consider the pandemic over and resume their usual activities, 36% responded that they would do so when most Americans are vaccinated and enough time has passed to confirm safety. Almost the same number — 33% — said that the threat of COVID-19 would never completely end, however. Just 7% felt that the pandemic was already over, with an equal percentage saying they would consider it as being in the past when the most at-risk Americans and essential workers were vaccinated. 

Augmented by interviews with Consumer Brands subject-matter experts in addition to the poll noted above, the report lays out five trends that will influence the CPG industry in 2021:

  1. Demand for CPG Products Remains High: Americans’ slow emergence from the pandemic, combined with long-term or permanent lifestyle changes, will keep CPG demand high long after the vaccine is widely available.  
  2. Supply Chain Innovation Flowers Out of Consumer View: Stores stay in stock to shoppers’ satisfaction, thanks to major changes in CPG operations.  
  3. The Recycling System Must Be Fixed: The consequences of increased plastic usage and waste during COVID-19 become evident.  
  4. Digital Transparency Ramps Up: Transparency demands are driven by consumer expectations, government requirements and new digital acclimatization after a year of virtual living.  
  5. Companies Evolve Into Societal Change Agents: The trust in companies that grew during the pandemic will result in businesses becoming societal change agents and forces for good. 

America has been fundamentally changed by the pandemic and will not go back to what was considered normal in February 2020,” added Freeman. “Rather, a new normal will emerge, redefined by the experience of the last year. The question for the CPG industry is how this redefined normal will translate to its business and the consumers it serves. This new report answers this question and charts the course ahead as the CPG industry emerges from the pandemic more resilient, trusted and prepared to meet the needs of consumers, every day.”

Arlington, Virginia-based Consumer Brands represents nearly 2,000 iconic brands.