Shoppers Face A Rise in Prices and Pests in Mid-July

FMCG and Retail | 07-20-2018

The middle of summer is a prime time for shoppers searching for outdoor essentials. Nielsen’s Friday morning data shows that for the week ending July 14, 2018, the U.S. fast-moving consumer goods (FMCG) market saw sales of nearly $15.4 billion, and unit volume of 4.9 billion. This marks a 2% increase in sales, but continued flatness in unit volume, up just 0.5% compared to this time last year.

Whether they’re getting ready for a camping trip or outdoor grilling, consumers are purchasing products that they’ll need for the great outdoors throughout the summer. Recently, however, they’re facing prices heating up around the grill while trying to combat a pesky problem with innovative options that may signal new opportunities for brands and manufacturers.

ALUMINUM PRICES FOILING GRILLING

Grilling is an annual summer tradition for many across the U.S. And this summer is no exception, with barbeque/grill accessories and cookware both seeing sales growth. As of June 30, 2018, total annual dollar sales for the two categories reached $34 million and $38 million, respectively, up 5.5% and 14.5% from the same time last year.

Yet a common grilling staple, aluminum foil is facing rising prices. In food storage, aluminum foil has seen a 10% rise in average unit price as of July 14, 2018, compared to the same week last year. Furthermore, foil this week has seen its highest average price of the year.

The impact of rising aluminum costs could have broader effects on certain food categories commonly sold in aluminum cans and packaging. In fact, soft drinks and various types of beans (particularly, fava, white and lima beans) have seen higher average prices in the short-term.  

CATCHING THE SUMMER BUG

Whether consumers are grilling or just spending time outdoors this summer, they’re facing more than just an increase in prices. Wet weather in major U.S. markets during the months of May and June has resulted in an uptick in mosquitoes over the past few weeks. And shoppers are eager to keep their pesky friends at arm’s length. Sales of personal insect repellent products the week ending July 14, 2018, soared nearly 10% higher than rates of a year ago. On the whole, personal insect repellent saw $12.9 million in sales this week, and unit volume increased by nearly 13% compared to this time last year.

Perhaps not surprisingly, bug spray in its liquid format drove the vast majority of sales, reaching new heights at $11.8 million. However, insect repelling wristbands and wipes saw strong growth, up 15% and 52% in dollar sales, respectively. Notably, SC Johnson & Son Inc. and HRG Group Inc. led other manufacturers, representing 90% of dollars sold this week, and 86% of dollar growth in personal insect repellents.  

Finding Function In Different Forms

Given the success of these alternative forms of insect repellent, manufacturers may be able to take a page from bug spray’s common summertime companion—sunscreen. Sunscreen has proved to be a perfect example of a product whose benefit can be incorporated into another item for enhanced purpose.

Similar to bug spray, sunscreen can serve a truly useful purpose functionally. On its own, sunscreen is a vital category to many families, and it’s essential to meeting various health care needs. And sales were up year-over-year for several different forms of the protective product the week before the Fourth of July. However, as an ingredient, sunscreen becomes a value-added feature to other products. When added to hand and body lotion, for example, the product fulfills both the consumer need for a moisturizer and also provides protection from ultraviolet (UV) light. And increasingly, consumers are searching for “all-in-one” products that can do both.

Products with sunscreen as an ingredient are certainly demonstrating the potential of ingredient innovation through product features. However, it hasn’t become a universally adopted feature just yet. Cosmetics with sunscreen as an ingredient feature have yet to pick up speed. While there’s appetite for UV protection, there’s still room to grow for this trend to proliferate the store.

Data for this article was made possible by Nielsen Friday morning data delivery, the earliest FMCG market read available. Learn more about Friday morning data delivery.

Tagged:  CONSUMER  |  CPG AND RETAIL  |  SEASONAL  |  NIELSEN FIRST LOOK  |  GROCERY

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