CHICAGO — While consumers increasingly have turned toward specialty brands and fresher products over big-name processed foods in recent years, classic brands and comfort foods are enjoying a resurgence as shoppers seek familiarity and easy-to-make meals during the coronavirus (COVID-19) pandemic.
Prior to the pandemic, issues like healthier ingredients, cleaner labels, novel flavors and distinctiveness were top of mind for food manufacturers. Now, they may be wrestling with the need to update longstanding brands while meeting demand for comfort and familiarity.
The answer is clear at Conagra Brands, Inc. Driving comfort from nostalgia isn’t in the company’s playbook, said Sean M. Connolly, president and chief executive officer, during an Oct. 7 virtual discussion hosted by the Consumer Brands Association.
“Big iconic brands can be evergreen, but only if you are perpetually modernizing them,” Mr. Connolly said. “There's a fine line between an icon and an antique.”
Conagra spent the last several years modernizing its portfolio to meet changing consumer priorities. The strategy paid off. Heading into 2020, products launched in the last three years accounted for more than 15% of total sales.
That success was compounded by the shift to at-home eating in March, and recent innovations have continued benefiting from increased demand even as more consumers seek classic comfort foods.
“I'd like to think that it's not just the tailwind of COVID, but also a lot of work in our portfolio over the last five years to infuse some industry leading innovation into the marketplace,” Mr. Connolly said. “What's happening now is consumers are discovering it at unprecedented rates.”
Most companies have focused on top-moving items to keep up with demand during the pandemic, and Conagra is no exception. The company already was trimming its number of stock-keeping units (SKUs) before packaged foods began flying off shelves in March.
“The need for the number of new SKUs that are needed in this environment is probably not as high, but one of the things that surprised me is that our customer demand for it has remained intact,” Mr. Connolly said. “I thought at the beginning of the pandemic, we may see a delay on some of our innovations rolling into the marketplace … but that really hasn't happened. The demand from our customers for our brand-new stuff has remained incredibly high. And to my surprise, the slate we've got in the marketplace this year is even larger than the big slate we had last year.”