Consumers are feeling the pinch when it comes to spending, and coming out of the holiday shopping season adds to that stress. According to research by Hershey’s Consumer Insights Team, individuals and families across the country are reporting they have less disposable income, driven by above-expected inflation. As a result, they’re increasingly selective about what they purchase, and they’re heavily focused on value. Enjoying food at home remains a priority.1
To make do, we’re seeing consumers shift where and how they shop. While higher-income consumers are heading to mass-market retailers, high-to-medium-income consumers are opting for membership-based club retailers where they can buy in bulk. There’s also been a broad shift to buying food at convenience stores versus quick-serve restaurants. And we’re seeing a notable trend in shoppers switching to dollar stores for savings.
How Hershey is responding to consumer trends
As individuals grapple with some difficult purchasing choices, it’s especially important for our teams to understand their behavior and to make sure our brands remain relevant. In that context, we know that value can mean a number of things in the eyes of consumers. Some are finding value in smaller items sold at a lower price point to treat themselves; others are opting for larger packages of their favorite snacks with a lower price per ounce. And some are choosing to purchase a less-expensive snack alternative.
Hershey is working hard to meet consumers where they are, whether they’re shopping in a different type of store or searching for promotions and deals. We’re doing this, in part, by offering different pack types through different retail channels. At convenience stores, for example, we know that 63% of shoppers share their on-the-go snacks with others. So we designed the Reese’s Super King for them. It includes six peanut butter cups, so everyone wins.
Speaking of share-able, we know that consumers often head to club-type stores to stock up for parties and events. So last year we released our 300-piece Bucket of Reese’s Peanut Butter Cups, which delivers a veritable mountain of peanut butter cups for parties, celebration occasions like Valentine’s Day, Easter or trick-or-treat and other gatherings. Dot's Homestyle Pretzels are also now available at specific club retailers for consumers looking for filling snacks. Another example I love to share is SkinnyPop. Savvy consumers are shopping for SkinnyPop at club stores because it’s such a treat for family movie nights (is anyone else trying to catch up on the Academy Award’s Best Picture nominees?). The whole family can come together, laugh together and consume giant bowls of popcorn together, knowing that the cost is a fraction of what they would have paid at a theater.
Another place we’re innovating is E-commerce. We’re seeing consumers really lean into bundled shopping, which isn’t too different from how people shop in stores – especially leading up to annual celebrations like the big game or the holidays. Think about the last time you visited a brick-and-mortar store to get a jumpstart on your celebration to-do list. You grabbed a cart and then went in search of everything you need for the season: festive decorations, party supplies, candy and snacks, Valentines for your child’s classroom and accessories. To make bundling easier online, we’re working with retailers to package and suggest bundles that include candy and snacks for the season. In Easter, for example, when people purchase Easter baskets online, we suggest candy to bundle with those baskets. It makes for an efficient virtual shopping trip, adding value by saving consumers time.
Finding value in more moments of goodness
Since Hershey’s earliest days, the company has been driven by its purpose to create more moments of goodness. When Milton Hershey founded our company, he sought to make chocolate affordable to all families, because he knew the importance of value. More than a century later, we’re still listening to what consumers need, learning about their challenges and finding opportunities to better serve them and so we can continue to be a part of more moments of goodness. While we can’t ease all the stresses our consumers might face, we hope that candy and snack lovers around the world are able to enjoy more moments of goodness regardless of how or where they shop.
Source:
1 Consumer and Business Update, Hershey Insights Research, November 2023
