CHICAGO — Since the onset of the COVID-19 pandemic last March, Conagra Brands Inc. has gained the equivalent of an estimated 4.5 years’ worth of incremental new buyers, according to Sean M. Connolly, president and chief executive officer. Many of the new customers tend to be younger, and the company is focused on earning their continued loyalty.
“Historically, younger adults have eaten at home less than older generations,” Connolly said Feb. 16 during an investor presentation at the virtual Consumer Analyst Group of New York meeting. “Historically, a meaningful shift toward at-home eating occurs during the family formation years, and COVID has accelerated the timing of this shift.”
With COVID-19 keeping more younger consumers at home, many have gravitated toward Conagra’s portfolio of frozen food, snacks and cooking staples.
“The data show that these new younger buyers are stickier across our entire portfolio,” Connolly said. “Our new brand buyers have higher repeat purchase rates than other category buyers across the board: in frozen, snacks and staples. Again, while the entire industry benefited from higher repeat rates, our portfolio clearly outperformed peers. And we believe this comes back to the investments in our products and brands.”
Connolly identified two trends he sees offering growth for Conagra Brands, particularly in frozen foods, including a lasting shift to working from home and greater demand for convenience.
“One of the primary drivers for more at-home eating is the increase in working from home,” he said. “Importantly, some aspects of the remote workforce adoption are expected to be permanent. A recent study of executives found that nearly 80% of respondents felt that office culture could be maintained with employees physically in the office less than five days a week. The way we work is changing, and consumer eating habits are changing with it.”
From March to November, consumers included a ready-to-eat or heat and eat food in 47% of their dinner occasions, according to Connolly. They increased their consumption of frozen foods by more than 9%, and the youngest demographics, Gen Z and millennials, drove frozen food growth by an outsized margin.