Affordable canned soups take spotlight amidst summer savings: Budget-conscious shoppers opt for long-term pantry essentials over temporary snacks.
In 2025, the humble bowl of soup is anticipated to have a significant moment, and rightfully so! That's according to the legendary brand behind those iconic soup cans - yes, you guessed it - Campbell's Co. In a recent announcement, they disclosed an intriguing trend: customers are increasingly embracing condensed soups and mac-and-cheese offerings while willingly abandoning the snack industry.
This shift in spending habits has some striking parallels to the early days of the pandemic. As per Cohen, CEO of Campbell's, consumers are cooking at home now more than ever since early 2020. It seems the convenience of dining at home is here to stay!
Interestingly, Campbell's snack empire, which includes Goldfish, Snyder's of Hanover pretzels, and Cape Cod chips, experienced a 5% slump in sales over the past quarter. In contrast, their meals and beverages division saw an impressive 6% surge, with Rao's pasta sauces and American soup sales leading the charge.
Though consumer outlooks have somewhat improved recently, it seems many continue to hold deep-seated pessimism about the economy. Factors like President Trump's ever-changing trade war and mounting inflation are encouraging folks to seek out cost-effective solutions, resulting in a shift towards essentials and more thoughtful snack choices.
Analysts at market research firm NIQ predict that this transition from extravagant snacking to a demand for value, quality, and health is the new normal. A recent survey by NIQ revealed that 42% of consumers are purchasing snacks less frequently, and 37% are actively chasing bargains. Many shoppers find themselves reconsidering name-brand snacks, opting instead for generic, budget-friendly alternatives sold at convenience stores or under supermarket private labels.
The tightening snack market is even causing some competition, with Oreo maker Mondelēz recently suing Aldi for blatantly mimicking some of its packaging designs.
Meanwhile, Oreo's parent company, PepsiCo, which makes Lay's and Doritos chips, voices a different tune. They're finding success in catering to consumers at lower price points. "Relative to where we were three months ago, we probably aren't feeling as good about the consumer now as we were a few months ago," said PepsiCo CFO Jamie Caulfield in April, also lowering the company's financial forecast for the year.
The growing focus on home cooking is indeed proving to be a game-changer for various food retailers. For example, Dollar General recently increased its sales outlook for the year, revealing that it picked up market share in food Products. This unexpected success comes amidst struggles faced by other retail giants like Target that sell groceries.
Interestingly, dining out prices are increasing nearly twice as fast as grocery prices. With meals out at 3.9% in April compared to a 2% increase in at-home food prices over the same time period, it's no wonder consumers are looking for ways to keep their wallets full! This shifting paradigm is affecting restaurant chains, with some iconic brands like McDonald's, Darden Restaurants, and Chipotle reporting weaker sales.
However, home-cooked meals aren't the only ones feeling the strain. More shoppers are falling behind on their installment loans for groceries, as revealed by a recent LendingTree survey. Even "buy now, pay later" services like Klarna report that their borrowers are experiencing a tougher time clearing their debts on the platform.
It appears that the home cooking phenomenon is here to stay, even as economic pressures and lifestyle trends continue to shape consumer behavior. Companies must adapt to this new reality by addressing the needs of their customers, focusing on value, quality, and promoting their products as essential components of home-cooked meals. After all, when it comes to food choices in 2025, it's all about cost-effectiveness and quality!
- Despite the improving consumer outlook, mounting inflation and economic uncertainty persist, leading individuals to prioritize value and essential goods over expensive snack items.
- In a bid to accommodate the new consumer mindset, companies like PepsiCo are focusing on lower-priced snack options to maintain market share, whereas brands in the meal and beverage division, such as Campbell's, are capitalizing on cost-effective, quality offerings like soups and pasta sauces.
- The shift in consumer spending trends has also had an impact on the loan market; with increased focus on home cooking, more individuals are falling behind on installment loans for groceries, and buy now, pay later services report borrower difficulties clearing their debts.
