Dive Brief:
- More than half of surveyed consumers (57%) said they would spend more on groceries during this year's holiday season as compared to 2014, according to a new study from CPG sales and marketing agency Acosta.
- About 77% of survey respondents said they will purchase prepared foods from the grocery store for their holiday meals and parties.
- Brand names also matter this time of year, with 25% of respondents saying they value name-brand goods over private labels, and the same amount saying they choose better name-brand items during the holidays.
Dive Insight:
"The growth in grocery spending this holiday season is encouraging for brands and retailers alike, as many experts anticipated this Christmas being a soft one across the board," Colin Stewart, Acosta's senior vice president, said in a statement. "With shoppers planning to try new recipes and incorporate prepared foods into their menus, providing easy solutions for shoppers will be key to finishing the year strong."
Dollar sales of the $26 billion fresh prepared foods segment are expected to increase by 6% to 7% annually through 2017, which outpaces the 2% to 3% CAGR forecasted for retail grocery food and beverage and the 3% to 4% CAGR for foodservice from last year through 2017, according to A.T. Kearney.
Consumers buying name-brand products over the holidays is promising for food manufacturers looking to end the year on a high note, especially if those brands bring in higher prices and profits. The same goes for manufacturers that lose sales to private-label brands.