Consumers are scaling back on food in recession

Published: Tuesday, May 19, 2009 8:04 p.m. MDT
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Shopping down is the today's biggest consumer trend.

Thanks to the economy, people are finding less-expensive options and cutting back on purchases.

"What matters today is food," said Todd Hale, the Nielsen Company's senior vice president of consumer and shopper insights. "People are cutting out the non-essentials. If you can't eat it, you don't need it."

Hale and chicken-industry executives spoke about the shift in consumer spending during the National Chicken Cooking Contest in San Antonio earlier this month.

Will consumers go back to their free-spending ways when the recession ends?

"Restraint will be practiced as the economy gradually recovers," Hale predicted. "But a new norm will be established, and the days of over-leveraged households are gone."

According to The Nielsen Company's data, the top places where people are cutting back are gas and electricity, entertainment and clothing.

But they're also "shopping down" on food:

For the first time in many years, people are eating more meals at home.

When they do eat out, they choose less-expensive restaurants.

They're also toting lunch to work and making coffee at home.

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2008 was the first time in years that the number of restaurant closings exceeded the number of restaurant openings.

Hale urged food writers to capitalize on the renewed interest in cooking.

"It's an opportunity for educating them, to avoid another lost generation of cooks."

Some other findings:

People who regularly ate steak and seafood are trading down to turkey or chicken. And if they were used to eating chicken breast, they are trading down to buying the less-expensive dark meat or a whole chicken to cook at home.

Those who were eating cheaper cuts of meat are cutting down to beans or other meatless proteins.

The grocery-store dollar sales of turkey increased by 8.1 percent, chicken increased by 4.5 percent, pork by 2.9 percent, beef by 1.4 percent and seafood lost 1.7 percent in the past 12 months, said Hale.

Sales of whole chickens are up. Twenty-five years ago, 35 percent of chicken sales were whole birds that people roasted or cut up themselves. In 2008 it was only 8 percent, and this year, it's up to 10 percent to 11 percent.

Sales of drumsticks and thighs are also up.

To keep the "doom-and-gloom" in perspective, Hale said that since 1948, the United States has had nine recessions, averaging 11 months each. Each recession has been followed by economic expansions averaging four years.

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These actual statistics kind of refutes up a lot of the theories of...

Anonymous | May 19, 2009 at 10:42 p.m.

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