Adding intention to impulse: How can dairy survive a slump in impulse buying?

Recent data from Nielsen IQ^[1]​​ and Circana^[2]​​ has shown that many consumer packaged goods are experiencing volume declines – but the figures may be masking greater macro shifts in shopping behavior, global consumer market research firm MMR Research has suggested.

The company’s Andrew Wardlaw hypothesized that global economic pressures, coupled with a rise in intentional living, has reduced impulse purchases – and brands should be strategizing accordingly if they wish to entice consumers into spending again.

“I wanted to suggest that a combined set of macro dynamics isn’t looking good for impulsive behavior by shoppers,” he told us. “It is a hypothesis, but nonetheless, it is born from recent volume declines in most CPG categories in the West. 

"Besides being a knock on from recent inflationary pressures, I believe that categories will need to work harder to reignite demand from a shopper base that is getting used to buying less. One huge macro trend that is taking hold across CPG categories is the rise of the intentional consumer, where purchasing becomes more purposeful and less impulsive.”

Aligning with shopper values

In dairy, desserts and ice cream are likely the most affected categories when shoppers shun impulse purchases, Wardlaw stated. “Sectors in dairy most likely to be affected will be those that are less linked to household replenishment, such as dairy desserts and ice cream.

“It is important that brands in these areas align more closely with the evolving values of shoppers, whether this relates to wellness or the environment or even self-expression. Younger audiences are more likely to buy ‘on purpose’ and will seek out brands that match up to things that matter most to them.”

He noted that adding intention to an impulse offering like ice cream could go a long way. “A great example is Magnum ice cream; Unilever has introduced a range that offers mood shifts for its shoppers – albeit in a slightly playful way. Similarly, Two Good Yogurt from Danone is a brand that has become very intentional, aside from offering a raft of functional benefits, it is now making contributions to organizations rescuing good food from going to waste and getting it to people in need. Brands that can respond to a rise in consumer activism will be best placed to benefit from a rise in intentional shopping – that will gradually eclipse impulsive shopping.”

There may also be opportunities to appeal through dairy's nutrition and health benefits to reach increasingly health-conscious consumers. In particular, with the emergence of weight-loss innovations like Ozempic and global regulatory pressures on foods that are high in fat, sugar and salt, there's a danger that ‘craveable’ foods may not be desirable.

“With the suggestion that ‘craveable’ is under threat by the emergence of Ozempic, we could see growth in smaller but better innovation, where nutrition density becomes far more important,” Wardlaw said. “Research by MMR Research has found that nutrition density and nutrition diversity are highly motivating concepts for consumers, and yet, these are largely underplayed by the industry.”

Diverse advertising strategies could also be crucial. According to Wardlaw, there’s evidence​ that traditional advertising is no longer effective while ‘disruptive’ formats - from audio-visual experiences to texture and flavor innovations - can be more effective. He explained that ‘in the low-attention economy, pack and product experiences pierce people’s consciousness’.

“It is my belief that to maximise mental availability with shoppers, brands must consider how they can renovate product experiences so that they are made more memorable,” he concluded.

The ice cream market is healthy

But even if consumers are making fewer impulse decisions as they shop, the market projections remain positive as far as ice cream is concerned. In the US, Statista estimates that the market will grow annually by 5.10% from 2024 to 2028. In the UK, sales of ice cream as well as yogurt and desserts have also steadily increased. According to a 2022 Kantar survey, more than four million people eat ice cream once a week, and 3.3m do so two to three times per week. In Europe, EU member increased their ice cream output by 5% in 2022 according to Eurostat, with Germany, France and Italy that top three producers by volume.