Expert Series: Frito-Lay Chief Customer Officer Mike Del Pozzo Sheds Light on the New State of Snacking
Posted: July 02, 2020 | Word Count: 774
By Mike Del Pozzo
Snacking isn’t slowing down this summer.
The week of Fourth of July is historically the biggest week of the year in the U.S. for Frito-Lay and salty snacks. Although eight in 10 Americans say summer will look very different, one in three Americans plan to snack more compared to last summer in light of COVID-19, regardless of how they are celebrating this season, according to Frito-Lay’s U.S. Snack Index.
We’ve seen consumer behavior shift in many ways over the last couple of months, but snacking doesn’t appear to be slowing down. In fact, IRI retail sales data shows that Memorial Day sales were up this year — salty snack sales were up 9 percent and early June data shows salty snacks were up by 5 percent.
From the beginning of the COVID-19 pandemic, we knew the most vital concern was the health and safety of our employees. In addition, during this time, we knew we had to maintain the trust of our retail customers and consumers. As the landscape of the pandemic evolved, our company continually shifted strategies to reassure them that we would be there to supply our products, no matter what.
Meeting Demand in a New Normal
As the first stay-at-home orders began in early March, shopping patterns dramatically changed. Shoppers flocked to their local retail stores to stock up on everything they thought they would need at home, causing many products to become scarce.
In the last couple of months, Frito-Lay has seen an increase in demand for products such as Lay’s, Tostitos, Doritos and Cheetos. Salty snacks have been the number two food contributor to sales growth at retailers since early March, according to IRI retail sales data. Our company responded to this sudden surge with quick action by streamlining production of some varieties of our core brands to focus on maintaining supplies of our most in-demand products.
Reducing product assortment to ensure the availability of products on store shelves nationwide set us apart. And, in recent weeks, we have brought back 95 percent of the snack flavors that were temporarily paused.
Snacking Creates a Sense of Normalcy
While snacking is a constant among American adults, the feeling it evokes, from comfort to normalcy to happiness, varies based on where they live. Adults in New York and Chicago are the most likely to feel comfortable (88 percent and 87 percent), adults in Dallas and Miami are most likely to feel happy (90 percent and 89 percent) and those in Los Angeles are the most likely to feel a sense of normalcy (90 percent) while consuming snacks.
The overwhelming majority (83 percent) of national respondents from the Snack Index survey said their favorite summer snacks remind them of good times, and nearly half (48 percent) said eating their favorite snack makes them feel happy, which goes back to our mission of creating smiles with every bite.
A Close Eye on Consumer Behavior Shifts
During this time, we’ve also seen a spike for unflavored tortilla chips (up 31 percent) and corn chips (up nearly 14 percent) as more people are enjoying things like nachos and Fritos pie as meals. Plus, dips — salsa, queso, bean dips — are also up 21 percent. We expect that to continue throughout the summer months.
Additionally, the U.S. Snack Index survey data revealed that 92 percent of the respondents who tried new varieties said they plan to continue to eat them once the pandemic is over. Most of those consumers who were willing to try new snacks in the "new normal" skewed younger, with Generation Z and millennials as the most adventurous: Nearly 4 in 10 (36 percent) said they were likely to try new snack options — with variety and convenience the top drivers of their purchases.
Keeping a finger on the pulse of our consumers is key to providing the right product at the right time.
Keeping Up with How Consumers Shop
Finally, it pays to recognize that shopping practices have changed due to the pandemic — since those habits may stick around. Online sales are up for snacks 43 percent since March 1 of this year and 74 percent year-over-year.
Our team at Frito-Lay launched the company’s first ever direct-to-consumer website, Snacks.com, in just 30 days as a response to the pandemic. Providing the quick, convenient access to products our consumers want will ensure they have another option to purchase their snack favorites.
This is an incredibly challenging time for all industries, but understanding our consumers has unlocked our ability to make quick adjustments to how we operate.
Mike Del Pozzo is Chief Customer Officer, Frito-Lay North America.