How Covid-19 is shaping the snacks market in India

August 21, 2020 6:53 AM

Globally, Google search for food delivery services surged by 300% during the lockdown

Businesses have projected that the turnover of sweets and namkeen products may plunge by 35% as compared to last yearBusinesses have projected that the turnover of sweets and namkeen products may plunge by 35% as compared to last year

By Amrinder Singh

Among many lifestyle changes, the Corona-induced lockdown is influencing our snacking habits. As we stay confined in our homes, anxious and anticipating what’s to come next, the ready-to-eat savouries become our instant companions, offering satisfaction as well as a sense of contentment. At a time when most sectors in the economy are adversely hit, how does this lifestyle change impact the snack market in the country?

Comfort in a packet

As work from home possibly demands more productivity and turnarounds, there is nothing like a biscuit or a cracker that relieves us from the immediate pressures of work, while offering mental stimulus. Additionally, the relative isolation and Corona-related anxiety are hidden triggers for craving such snacks, which eventually work as a morale-booster.

Globally, Google search for food delivery services surged by 300% during the lockdown. Within India, a survey revealed that over 70% of urban consumers will prefer to purchase items from retailers that offer home delivery services, with 78% disposed more towards digital payments. So, with an upturn in demand for packaged snacks, companies are making frenzied tie-ups with popular online food delivery service companies, with a view to target the increasingly ‘at home’ customer segment.

At the same time, they are also forging linkages with supermarket and hypermarket brands to ensure that their offerings are available in plenty for the offline customers, too. A prominent retail firm reported more than 50% growth in the biscuits and snacks category, as compared to the pre-Covid times.

Corona has in some ways impacted our pockets. This pressure has not only forced many of us to migrate from regular food to snacks, but also opt for smaller value packs that are priced more modestly. For millions of migrant workers departing for homes, as also our Corona warriors in the line of duty, these affordable and instant treat options became the go-to choices. A top dairy brand with a chain of outlets across the country reported a surge in demand for its biscuits, chocolates and Indian sweets.

Healthy and ‘guilty pleasure’

Even as the ongoing pandemic has made people more health-conscious, driving them towards healthier snacking options, the unhealthy guilty pleasure snacks have equally been in demand. While snack companies are making more sugar-free and immunity-strengthening alternatives by adding nutritional value to their products, subscription-based healthy snack boxes are on the rise. In a survey, about 90% of the respondents admitted to being more wary about health, cleanliness and safety issues post Covid-19. Yet, the guilty pleasure snacks — a coping mechanism — have also retained their charm. A 60-70% rise in sales in baking ingredients with people at home wanting to replicate ‘restaurant style’ bakery products during the lockdown period is a testimony to that fact.

The packaged snacks segment quickly recovered and registered impressive performance. However, the unpackaged category including namkeens and Indian sweets have suffered. Lying largely in the unorganised sector, the Corona-led reverse migration has led to workflow disruption, production falls and losses. Businesses have projected that the turnover of sweets and namkeen products may plunge by 35% as compared to last year. However, once the lockdown has eased, this segment, too, has shown signs of revival.

Even before Covid-19, snacking was becoming popular. A huge section of the young population was already switching from the regular three-meals-a-day to many small meals. The snacks segment is the obvious gainer. In a survey conducted last year, 75% of Indians had termed snacking as the future of food. About the same percentage also reported snacking more than they did just a year ago.

The author is director, Bonn Group of Industries

Read Also: How production budgets for ad-films have declined by 20-30%

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