Thanksgiving Becomes Latest Holiday to Be Upended by Covid-19
Thanksgiving Becomes Latest Holiday to Be Upended by Covid-19
(Bloomberg) -- Ham or lobster for Thanksgiving? It’s 2020, so why not?
Retailers are preparing to sell a greater variety of food this holiday to accommodate those who are cash-strapped -- or simply intimidated by the prospect of preparing a full Thanksgiving meal without relatives’ help. The work-from-home-crowd, meanwhile, is flush with savings and expected to stock up on gourmet items.
For grocery stores and packaged-food companies, there’s a lot at stake: It’s the largest food-buying week after Christmas. Last year’s sales for the week ended Nov. 30 totaled more than $12 billion, with fresh meat accounting for $1 billion, Nielsen data show. At the same time, more than a third of Americans plan to spend less on Thanksgiving this year, according to a survey from mobile-rewards platform Ibotta Inc.
With travel still constrained amid Covid-19, gatherings are expected to be smaller this year. Sam’s Club is stocking more small turkeys in the 10- to 16-pound range, instead of the big 22-pounders that feed a crowd. But with some shoppers holding more disposable income that usual this year, the warehouse retailer is also making sure it has grass-fed beef, lobster and king crab legs, said Russell Mounce, senior vice president for the Walmart Inc.-owned club warehouse.
There will also be more turkey breasts, instead of whole birds, and chicken on the menu, according to Meagan Nelson, associate director of Nielsen Fresh. “Instead of getting a whole turkey, they’ll downsize and get a whole chicken instead,” she said in a recent presentation.
Walmart is boosting inventory of both bone-in and boneless turkey breasts by as much as 30%. The world’s largest retailer is also ramping up supply of ham, which can be easier to prepare and get in smaller sizes.
“With Walmart customers planning smaller gatherings and prioritizing convenience, ham will be in the spotlight and we’ve increased our inventory accordingly,” Jacqui Lyons, divisional merchandise manager of seafood and seasonal meat for Walmart said in a blog post Tuesday. “We know this year has been difficult for our customers and their families.”
Jobless Rate
The U.S. jobless rate, while recovering from record highs, is still elevated at 7.9%, and this is having an impact on shopping patterns.
“We’re starting to see in the data a little more trading down to more private label,” said Franklin Isacson, managing partner at Coefficient Capital in New York. “The stimulus is running out and people are losing their jobs.”
At the same time, consumers whose jobs haven’t been affected have saved money by not traveling and eating out and have more to spend this holiday season, he said.
Companies like Conagra Brands Inc., which makes Reddi-wip whipped cream and Marie Callender’s frozen food, see an opportunity to break into some new cupboards as young families prepare a full Thanksgiving meal for the first time.
“It can be really daunting,” said Ashley Lind, Conagra’s director of demand science. “We’ll see people who will for sure try to make the things that are so iconic, the turkey, the stuffing, but where we might see people really looking to some of the shortcuts and hacks could be with sides and dessert.”
She sees the company’s frozen vegetables and frozen pies -- “making a pie from scratch can be really difficult” -- rounding out dinner tables this year.
Turkey producers don’t see Thanksgiving’s signature dish being displaced, however. Nicole Behne, vice president of marketing for Hormel Foods Corp.’s Jennie-O brand, said the company did its Thanksgiving planning before Covid-19 hit and hasn’t changed its plans. But the company also sells some smaller birds and turkey breasts that may be better fits for some this year, she said.
“Traditions are very powerful” and families used to eating turkey “are going to find a way to get that turkey,” Behne said. “I just can’t see myself even trading down to a whole chicken instead of a turkey for Thanksgiving. There’s just something about that that doesn’t seem right.”
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