1、 2023 Information Resources Inc.(IRI).Confidential and proprietary.1February 2023Impact of Inflation on Consumer Behavior2The U.S.economy has proven resilient but were not out of the woods yet.Unemployment remains low and consumer expenditures remain strong,with most spending growth going to service

2、s rather than goods.CPG dollar sales remain strong,even as unit sales decline.Shoppers are shying away from discretionary purchases.At-home food spend remains strong,with center store sales up 11.1%and perimeter dollar sales up 6.3%in Q4 2022.However,consumption levels continue to soften as consumer

3、s deal with broad-based inflation.Value channels are performing well as shoppers try to manage budgets.2023 OutlookSales of premium products,which drove growth during the height of the pandemic,are easing,while sales of private label products are increasing.Still,pockets of premiumization exist,espe

4、cially in sports drinks,canned/bottled fruit and non-chocolate candy.Promotions for food and beverage products,especially in perimeter departments,are increasing.Look for promos to increase in 2023 as competition heats up.Food and beverage dollar sales will moderate in 2023 but will still be stronge

5、r than the historical baseline,even as volume sales remain muted.SummaryImpact of Inflation on Consumer BehaviorAt-Home Food Inflation in December 2022+13.2%vs.Year Ago(YA)3While Economic Conditions Remain More Positive Than Expected,Economists Generally Continue to Expect Weakening AheadKey U.S.Mac

6、roeconomic IndicatorsSources:St Louis Fed economic data,various government sources BEA,BLS,University of Michigan Consumer Sentiment Index.Forecasts based on WSJ analyst consensus survey.IRI Client Engagement.3.71.81.92.20.1-0.40.00.6Q1 22Q4 22 FQ2 22Q1 23 FQ3 22Q2 23 FQ3 23 FQ4 23 FAnalyst consensu

7、s forecast per WSJReal GDP%chg.vs.YA13.26.34.03.5Jan-22Dec-22May-20Jan-21%Unemployment RateTrough 08-09 recession-4.0%(Q1 09)Real Consumer ExpendituresChained 2012$T1/1/211/1/1913.01/1/201/1/221/1/230.011.512.012.513.514.04CPG Retail Is Less Volatile and More Resilient in an Economic DownturnSources

8、:U.S.Census Retail Trade,data ending July 2022.IRI Client Engagement.Hobby Stores(e.g.,sports,music,books)Health&Personal Care StoresFood&Beverage StoresOnline Retailers4.4%Gen Merch RetailersFood Service&Drinking PlacesClothing StoresElectronics&Appliance Stores Misc.(incl.pet,office,tobacco stores

9、)5.4%3.2%Gas StationsBuilding&Furniture StoresMotor Vehicle&Parts DealersTotal5.4%3.1%5.1%4.1%3.2%2.1%9.7%4.2%4.3%4.7%2007-09 Recession-1.3-1.8-3.1-4.5-5.2-7.0-7.8-9.4-10.7-12.5-14.8-18.6-9.1Long-Term Growth Baseline by Retailer Type/$%(1993-2022 CAGR)More volatileLess volatileCPG RETAILERS929395818

10、989109310911,2671867556521,5418,059Segment size in 22$B,annualGrowth Rate Ppt.vs.Baseline(1993-2022 CAGR)5CPG Sales Remain Strong Despite Unit Declines,Although Discretionary Spend Areas Are Beginning to See Larger Declines2022 Retail Sales Trends by Industry/12 Months Ending November 2022%Chg.vs.YA

11、Note:Nonedible CPG excludes Tobacco.Sources:IRI and NPD data ending Nov.2022.IRI Client Engagement.171096420-1-1-1-3-4-6-713-1-3-7-8-7-4-7-7-9-7-5-16-11Clothing&Access.Prestige BeautyNonedible CPGEdible CPGFootwearToysAutomotiveOffice SuppliesJuvenileHouse-waresSmall AppliancesBooksVideo GamesConsum

12、er ElectronicsDollarsUnits27438929253481414115Last 3 months ppt.growth rate vs.L12 monthsDollars-6-123-3-4-101-4-1-1-412-5Units-5-202-3-3-31001-421Annual$B6Perimeter Departments See Price Inflation Coming Down as They Lap Pricing Taken in 2021,While Center of Store Inflation Remains Eleva

13、ted Weighted Average Price Inflation,Chg.vs.YA/MULONote:Increased Price includes increases in everyday price,reduced promo depth and increases in promotional frequency.Analysis done at UPC level for releasable UPCs to get to category view then weighted to totals based on category dollar dales.Source

14、s:IRI POS.IRI Executive Insights.1.0%2.7%2.7%12.5%9.4%12.7%15.2%15.3%1.2%2.8%5.5%9.4%11.4%10.8%10.1%7.5%Q4 2217-19Q3 222020Q1 222021Q2 2220222022 Quarterly TrendsPerimeterCenter of Store7Price Inflation Across the Store Varies Widely,With Small Price Increases in Fresh Meat&Seafood and Alcohol but L

15、arge Increases in Bakery and DairyPrice Inflation for Branded Products by F&B Segments for Q4 2022 YA/Omni Projected Based on MULO PricingNote:Dollar-weighted average price(including base price and promotion)change across UPCs,based on releasable UPCs.Excludes any product mix effects.Source:IRI POS

16、data ending 12/25/22.IRI Client Engagement3.4%5.4%7.4%10.1%11.3%14.7%14.8%14.9%16.0%16.6%17.5%18.0%23.2%BakingProcessed MeatDeliFresh Meat&SeafoodBeveragesAlcoholProduceSnacksIce Cream/FZ DessertsShelf-Stable Meals+Ingred.BakeryFrozen Meals+Ingred.DairyCY 22vs.YA8.5%3.7%9.6%14.0%10.4%12.4%10.7%13.0%

17、13.9%13.2%13.1%15.3%15.5%Avg.F&B=13.2%8112 wks 10/30/22 vs.YA(F&B);210 wks ending 9/4/22 vs.YA(MULO);312 wks 9/4/22 vs.YA(MULO);4 26 wks ending 10/30/22 vs.YA across 173 syndicated edible categories(MULO);5 26 wks ending 10/2/22 vs.YA(MULO)Consumers Use Multiple Tactics to Reduce Spend in Pressured

18、TimesBroad Behavioral Bifurcation Exists Between High-and Low-Income ShoppersTrade Down to EssentialsTrade Up to Affordable LuxuriesGrocery(Seek Deals)and ConvenienceValue ChannelsLeftovers&Less WastePremiumMainstreamNational BrandsPrivate LabelValueBuy DIY At HomeBuy Away-From-Home Quality for At-H

19、ome IndulgenceAT HOMEBulk Value for PrioritiesLower-Ticket ItemsFast Casual RestaurantsQuickServe FoodConvenience-Store Food24CasualDining(seek more value meals/deals)Do-It-YourselfPersonalServicesAWAY FROM HOME From liquid laundry detergent(-9.5%)to cheaper powder form(+8.1%)2 Food storage boxes+41

20、%2 Quick trips growing 6x vs.other types3 Club winning share of trips3 Ice cream deals back to 2019 levels3 Premium F&B brands lost 0.7 share points3 Growth for PL in 75%of all F&B cats4 PL growth strong in staples e.g.,eggs,milk,butter Espresso makers+16%Moka pots+32%Extended time between visits Ap

21、parel-1%$,-4%units vs.YACommercial restaurant traffic-2%,average check+3%Change in avg.vol/unit(L26 weeks vs.YA)5:Sports drinks+10%Snack bars+8%9F&B Retail Sales Trends/%Chg.vs.YA by OutletAs Shoppers Seek Value and Convenience,the Food Channel Is Not Growing at the Same Rate as E-comm,Dollar and Cl

22、ub ChannelsSource:IRI OmniConsumer Scan Panel,52 weeks ending 1/29/23 vs.YA,NBD aligned.Note:Walmart is not included in grocery or mass/super.16%14%12%7%6%4%2%9SpecialtyStoresInternetMassX and SupercenterXDollarClubDrugFood10Food-at-Home Consumption Remains Strong Despite Higher Prices;Some Perimete

23、r Softness in 1H 2022 Has Begun to ModerateF&B Retail Sales Trends/%Chg.vs.YA-MULOCNote:Volume is dollar-weighted change across categories.Source:IRI POS data ending 12/25/22.IRI Client Engagement.1.514.42.76.15.26.56.36.32.213.31.99.25.59.410.511.1Dollar SalesEst.Volume Sales0.810.6-3.3-3.8-5.4-4.1

24、-3.8-1.71.110.5-1.3-1.9-2.1-2.1-2.0-1.820022Q1 2022Q2 2022Q3 2022Q4 2022PerimeterCenter of Store11F&B Segments Are Seeing Decelerating Volume Sales Declines in H2 2022 Weeks vs.YA,Particularly in Alcohol,Baking and Fresh Meat and SeafoodShifts in F&B Segment Volume Growth as Inflation Inc

25、reases/H2 2022 vs.YA,Change in Trend vs.H1 2022Source:IRI data ending 12/25/22,IRI POS for MULOC GeographyTRADING OUTTRADING INIMPROVING TRENDProduceAlcoholBeveragesH2 22 vol.%chg.Vs.YABakeryH2 volume%chg.vs.YA ppt.delta vs.H1 rateBakingDairyDeliFresh Meat&SeafoodFrozen Meals&Ingred.Ice Cream/FZ Des

26、sertsProcessed MeatShelf-Stable Meals&Ingred.Snacks-4-202468-5-4-3-2-101SLOWING GROWTH12Although Most Perimeter Categories in 2H 2022 Are Seeing Lower Consumption Than Previous Year,the Declines Are Decelerating vs.H1 2022 Shifts in Perimeter Category Volume Growth as Inflation Increases/H2 2022 vs.

27、YA,Change in Trend vs.H1 2022Source:IRI data ending 12/25/22,IRI POS for MULOC GeographyPerimeter CategoryVolume Sales Growth vs.YAH2 chg.vs.YAH1 chg.vs.YADiff H2 vs.H1(ppts)DELI GRAB&GO LUNCHMEAT1.3%5.3%-4.0PORK0.2%-3.6%3.8BEEF0.1%-5.0%5.1CHICKEN0.1%-1.5%1.6TROPICAL&SPECIALTY FRUIT-0.8%-6.4%5.6COOK

28、ING VEGETABLES-1.0%-6.1%5.2SNACKING/SALAD VEGETABLES-1.2%-4.1%2.9ROOT VEGETABLES-1.7%-2.0%0.2DELI DIPS/SAUCES-2.4%1.0%-3.5COMMON FRUIT-2.5%-0.3%-2.2DELI SPECIALTY CHEESE-2.8%-3.8%0.9DELI SALADS-3.1%0.6%-3.7CRUCIFEROUS VEGETABLES-4.8%-6.0%1.2SALADS&LEAFY GREENS-4.9%-5.7%0.8CITRUS FRUIT-5.5%-13.1%7.6F

29、RESH SHELLFISH-8.2%-27.3%19.1FRESH FINFISH-8.5%-15.7%7.2STONE FRUIT-10.5%-22.5%12.0DELI SERVICE LUNCHMEAT-10.7%-11.1%0.41313There Is New Growth in CPG for Multifunctional Products and New Home Routines;Some Perimeter and Grocery Gen Merch Sales Are Trending DownCPG Categories With Changing Volume Tr

30、ends Post-Pandemic Source:IRI Omnichannel data ending 10/30/22.Trending UpStronger volume trends holding after pandemicMultifunctional Health&Value,New Home RoutinesEXAMPLESSports Drinks,FZ Appetizers&Breakfast Food,Rice,SS Dinners,Baking Mixes,Prepared Entres,Vitamins,Household Cleaner,Pet Treats,P

31、aper Towels,Hand&Body Lotion,Suntan Products Vol.%chg.vs.YA%CAGR vs.2019%chg.vs.YA-10-50502020212022Trending DownWeaker volume trends post-pandemicVol.%chg.vs.YA-10-50502020222021Seafood,Perimeter Bakery,Bonus PurchasesEXAMPLESFZ and Processed Chicken,Fresh Seafood,Perimeter Ba

32、kery,General Merchandise(in Grocery)%CAGR vs.2019%chg.vs.YA14In F&B,Multifunctional Beverages and Elevated and Easy At-Home Cooking Experiences Dominate Emerging BrandsThemes From Fastest-Growing Emerging Small Brands Illustrative Emerging Small Brands ShownSource:IRI POS data,analysis of fastest gr

33、owing F&B companies between$10M-500M in annual retail sales.Ghost Energy DrinksClean Ingredients Electrolytes Apple Cider Vinegar Natural Caffeine Antioxidants Vitamins B6&B12 Superfoods Magnesium Calcium Botanicals Prebiotics Plant FiberFunctional HydrationBeverages that emphasize clear health and

34、wellness benefits that boost performance and healthy energy with various attributes.Alani Nu Energy DrinksOlipopSparkling TonicPoppi SodaCedars Dips and SpreadsJus Rol DoughTru Fru FZ Chocolate Covered FruitGiovanni Rana EntresFresh Cravings DipsKevins RFG EntresC4 Energy DrinksElectrolitSports Drin

35、ksPrime Sports DrinksScreamin Sicilian FZ PizzasAuthentic and Convenient At-Home CookingAuthentic,high-quality meals and snacks are easy to make and provide a better-for-you home cooking and snacking experience.15As F&B Growth Shifts to Private Label Brands Due to Inflation,Premium Growth Is Slowing

36、 DownShifts in F&B Price Tiers Through Pandemic and Increasing InflationNote:Price tiers determined by line extension avg.price per volume vs.corresponding subcategory avg.price per volume.Premium 1.25*avg.,Value 1.25*avg.,Value 0.75*avg.based on MULO.Source:IRI POS data ending 12/25/2022,MULO.Categ

37、ories Where Consumers Are TRADING UPCategoryPremium Tier%Dollar Shr.Prem.Ppt.Chg.vs.YASports drinks24.3%+2.3%Canned/bottled fruit16.2%+2.0%Non-chocolate candy23.8%+1.5%SS dinners28.6%+1.4%Bacon17.4%+1.0%Spirits/liquor52.3%+0.9%Cookies27.6%+0.9%Salty snacks10.6%+0.8%Milk flavoring/cocoa mixes35.0%+0.

38、7%Wine51.1%+0.7%Categories Where Consumers Are TRADING DOWNCategoryPrivate Label%Dollar Shr.PL Ppt.Chg.vs.YADeli prepared meats24.7%+11.8%Deli spreads25.2%+8.7%Perimeter cookies36.7%+7.9%SS meat25.9%+5.1%Sugar60.4%+5.0%SS coffee creamer30.3%+5.0%Fz juices40.2%+4.4%Rfg whipped toppings54.5%+3.8%Cotta

39、ge cheese37.1%+3.8%Bottled water34.2%+3.4%1717F&B Promo Levels Increased Throughout 2022,With Perimeter Seeing Higher Lifts Than Pre-Pandemic,But That Is Not the Case for Center of Store CategoriesF&B Promo Levels and Volume Lifts(Indexed to 2021),Food Channel Source:IRI data ending 12/25/22 POS,Gro

40、cery Channel.IRI Executive Insights.Sales on PromoPromo Volume Lift422PerimeterCenter of Store1818Some Categories Saw Significantly More Promotional Levels in Q4 2022 vs.YA;However,Many Are at Lower Promotional Levels Than 2019Source:IRI data ending 12/25/

41、22 POS,Grocery Channel.IRI Executive Insights.CategoryChange vs.Q4 2021Change vs.Q4 2019Fresh shellfish+15.6%+10.1%Fz breakfast food+15.0%-8.4%Fz novelties+14.7%-12.8%Bacon+14.1%-2.6%Sports drinks+13.4%-40.8%Chicken+13.1%-16.4%Fresh tropical&specialty fruit+12.7%-13.9%Dinner sausage+12.6%-12.8%Fresh

42、 finfish+12.5%+14.9%Fz dinners/entres+12.1%-17.8%Fresh citrus fruit+11.9%-9.3%Fresh cooking vegetables+11.7%-6.7%Pork+11.5%+27.6%Cookies+11.5%-6.4%SS rice+15.6%+1.5%1919Retail F&B Dollar Sales Growth Will Moderate in 2023,a Result of Easing Inflation and Price Stability,Increasing Price Elasticity a

43、nd Increased At-Home Consumption Retail F&B Forecast/Omnichannel Note:Historical baseline based on 2010-2019.2022 based on data ending 10/30/22.Source:IRI Client Engagement.13.33.18.75.5202020222021Historical Baseline2023 F2.0-3.09.3-1.7-2.0-2.00.4-0.63.74.811.07.61.5-2.5DOLLAR SALESPRICE PER VOLUME

44、/MIXEST.VOLUME SALES20Some Key Trends in CPG Heading into 2023Inflation is likely to moderate yet will remain relatively high vs.historical standards.In-home consumption will remain elevated due to lingering COVID-19 behaviors and economic stress.As such,expect value shopping behaviors to continue t

45、o define 2023.Value channels(mass,club,limited assortment grocery,dollar)will continue to do well in F&B.Meanwhile,more nonedible CPG will shift to pure-play e-com,(taking some food with it too).Despite overall trading-down tendencies,consumers will look for premium experiences at home;innovation th

46、at balances premium experiences,with better-for-you,taste and convenience continuing to do well.Private label use will remain elevated in select areas where consumers are familiar with it;its unlikely private brands will make further inroads in categories where name brands are strong.Promotion will

47、likely increase,driven by increasing competition,yet will remain behind pre-COVID-19 levels of intensity in many categories.2023 Information Resources Inc.(IRI).Confidential and proprietary.21Questions&Answers22IRI Thought Leadership Delivers Insightful and Provocative InsightsC-Suite Conversation S

48、eries18 conversations recorded to date with transcripts,video and audio content.Demand Index Inflation Tracker E-Commerce Demand Index Supply Index Channel Shift Index Promotions IndexCPG Economic IndicatorsThe latest data on category trends,out-of-stocks,demand and supply,inflation,consumer sentime

49、nt and more.Industry-Leading Reports45+thought leadership reports published to date,reshaping how our client executives perceive us.WebinarsBlogsPodcasts 2023 Information Resources Inc.(IRI).Confidential and proprietary.23Registered Users Get New Thought Leadership from IRIs Research,Data and Analytics E to Be the First to Know 2023 Information Resources Inc.(IRI).Confidential and proprietary.24THANKYOU!IRI