Ice Cream Sales Cool Off…But Not As Much As Other Types of Food

How has COVID-19 impacted the Netherlands’ US$402 million ice cream industry? 

According to our CPG data*, the lockdown has melted out-of-home demand by over -30%, compared to the same period last year. Merchants were unfortunately not able to reap the gains from the sunniest April on record.

Unilever’s ice cream business, the world’s largest in annual sales, sees half its sales made outside of grocery stores in places like beaches and parks. In fact, the company has been ramping up partnerships with food delivery services to allow consumers to order ice cream along with their takeout.

However, compared to other food categories, ice cream is still holding up relatively well. There has been an even greater decline in revenue for out-of-home consumption of drinks, prepared meals, snacks and candy.

The only question is whether demand for ice cream will be revived in the critical summer months ahead, especially as F&B outlets will be allowed to reopen again. 

*About our data:
Suburbia partners with companies in the payments and retail industries to create data sets that track anonymized consumer purchases across Europe, delivering a daily view into some of the world’s biggest consumer brands. For insights on consumer packaged goods (CPG) trends, Suburbia’s data set covers sales in over 14,000 on-trade channels across six countries in Europe.

The Recovery is Real: 50% Jump in Open Merchants in Germany

The F&B industry has been one of the hardest hit by the COVID-19 pandemic. Immediately after lockdown measures were announced, our CPG data* showed only around a third of restaurants in our panel remained open in Germany and the Netherlands.

Clearly, many restaurants needed some time to adapt their business and pivot to delivery and takeout. While there was incremental growth in open merchants in the weeks following the shutdown, growth has been slow and gradual. Since the lockdown, nearly half of restaurants in Germany are now back in business, while 20% more restaurants in the Netherlands have reopened since the lockdown came into effect.

However, it appears that German F&B is seeing a healthier recovery in sales per merchant. While there was a sharp decline in sales leading up to more stringent social distancing measures, it made a significant gain the following week. While German restaurants are still making considerably lower revenue with the loss of dine-in sales, the value of restaurants receipts in the week of 20 April was over 75% of receipt value in a “regular” week prior to the lockdown. 

Meanwhile, Dutch F&B merchants have been less fortunate, seeing no sharp bounce-back after bottoming out. Even in mid-April, when it was being reported that food order volumes in many virus-stricken countries were on the rise again as cooking fatigue set in, sales growth in the Netherlands remained minimal and sluggish. Restaurants were just barely raking in half of the sales they used to. 

While more restaurants are reopening and sales are slowly picking up again, it will be critical to keep an eye on these figures once F&B businesses in both countries are allowed to accept dine-in customers once again.

About our data:
Suburbia partners with companies in the payments and retail industries to create data sets that track anonymized consumer purchases across Europe, delivering a daily view into some of the world’s biggest consumer brands. For insights on consumer packaged goods (CPG) trends, Suburbia’s data set covers sales in over 14,000 on-trade channels across six countries in Europe.

Beer in the Time of Corona

As the COVID-19 pandemic spread earlier this year, it was falsely reported that Corona beer sales were hit as people associated the brand with the deadly disease.

While that has been debunked, Corona did become the unfortunate punchline of jokes and memes because of its name. Bars around the world even tried to cash in by offering distasteful coronavirus-themed promotions on Corona beer, with some of them suffering backlash for their insensitivity.

What were the European F&B and consumer sentiments around Corona in Europe in the past few months though? We dived into our CPG data* to find out.

Looking back at 2019, Corona enjoyed stunning growth in year-on-year sales, with a sharper spike in summer compared to all other beer brands in our data set. In early 2020, Corona was still seeing healthy growth in sales before going into freefall following the mandated closure of the F&B sector. 

As online searches for terms like “coronavirus beer” surged in February, Corona’s shares also tumbled. While Corona’s sales did decline in March, so did all other beer brands. We did not see Corona being more negatively impacted than others. In fact, Nielsen released sales data in late March showing a surge in sales for Corona at retail stores. 

While these are extremely tough times that have battered the hospitality industry as well as brewers like ABInBev, we believe consumer sentiment around popular brands like Corona hasn’t shifted – which should stand them in good stead for better times to come.

About our data:
Suburbia partners with companies in the payments and retail industries to create data sets that track anonymized consumer purchases across Europe, delivering a daily view into some of the world’s biggest consumer brands. For insights on consumer packaged goods (CPG) trends, Suburbia’s data set covers sales in over 14,000 on-trade channels across six countries in Europe.

4 Ways COVID-19 Is Changing How We Eat

  • Junk food drives F&B sales
  • Drinks category hit hardest

With the entire hospitality industry in Europe reeling from the coronavirus shutdown, delivery and takeout were supposed to provide a much-needed lifeline for F&B businesses. Indeed, our CPG data* shows that prepared meals now account for a lion’s share of F&B sales. 

But how else is the current situation affecting consumer habits and behavior when it comes to food and drinks? What are the implications for merchants and industries? This is what Suburbia’s CPG data* reveals: 

  1. Drinks sales have fallen from 43% to 2% of revenue in the Netherlands

These days, customers are much less likely to order beers with their meals or a coffee to go. Before government-mandated store closures in the Netherlands, beer had a 39% share of total F&B sales in our panel but that has plunged to just 1%. 

Overall, drinks sales in the country have fallen from 43% to 2% of revenue. Meanwhile, in Germany, coffee used to drive a quarter of sales but since the lockdown, it now contributes only 2% to total revenue. 

It’s not that people are drinking less – in fact, reports have shown that sales of booze are spiking worldwide and packaged coffee sales are booming. Understandably, consumers may not want to pay the restaurant markup on drinks when they can purchase these at retail – but F&B merchants often depend on the wider profit margins on beverages.

So if you really want to help out the struggling restaurants in your neighborhood – include some drinks in your next order.

2. Everyday is Sunday: People aren’t differentiating weekends and weekdays

Universally, Saturday is the busiest day of the week for restaurants, accounting for nearly a quarter of total weekly sales at a typical merchant and rising by a few percentage points compared to Friday. 

But now, sales actually sink on weekends, with a steep plunge of up to -23% in Germany. In the Netherlands, merchants have fared somewhat better, with weekend dips remaining in single digits so far.

It seems current lockdowns have all but obliterated weekend activity.

3. We’re snacking our way through the lockdown

These strange, unsettling times must be making people seek comfort in snacks and candy, which have become a huge driver of F&B sales. This is particularly so in Suburbia’s home country of the Netherlands.

Dutch merchants are seeing -46% lower sales for all F&B categories, including prepared meals, for the week ending March 31 vs. the same week the previous year. 

In contrast, weekly sales for snacks and candy are up a whopping 152%!

Good news for snack bars – but perhaps not for salad bars.

4. Germans are chowing down on burgers while Dutch diners opt for cheap and healthy options 

We looked at the top-selling products across Germany and the Netherlands and found that burgers reign supreme in the home of the original hamburger. They account for nearly half of all F&B sales in Germany! Customers seem to prefer meaty meals with sausages, schnitzels and steaks also cracking the top 10.

As highlighted earlier, the Dutch are snacking a lot more but they seem to be compensating for this by generally choosing more nutritious meals over fast food. In fact, Japanese sushi is one of the most popular foods ordered in the Netherlands. 

What is also interesting is about a quarter of menu items ordered contain words like “promotion” or “deal”. It suggests Dutch merchants should consider bundling different items together into a “value meal” to draw more customers and increase sales.

About our data:
Suburbia partners with companies in the payments and retail industries to create data sets that track anonymized consumer purchases across Europe, delivering a daily view into some of the world’s biggest consumer brands. For insights on consumer packaged goods (CPG) trends, Suburbia’s data set covers sales in over 14,000 on-trade channels across six countries in Europe.

Data Shows that Pandemic Compelled Businesses to Act Faster Than the Government

  • Businesses more proactive than governments in Europe
  • Public behaviour no different in hardest hit regions in Germany and the Netherlands

The COVID-19 outbreak has thrown much of Europe into lockdown. Germany and the Netherlands have shut bars, while restaurants are allowed to stay open only for takeout and delivery services.

In recent days, both countries have also tightened rules on social interaction, banning groups of more than two or three people for gathering. It has been two months since the first confirmed case surfaced in Germany and nearly a month since the Netherlands’ first case – so have these moves come too late?

While this is up for debate among epidemiologists and public health policy experts, we analysed our CPG data* to determine two things: business response and public response to the crisis in Germany and the Netherlands over the first quarter. As a proxy for public behaviour, we looked at key indicators such as the number of transactions and sales volume at thousands of F&B outlets across these two countries.

Store closures preceded government action

In both countries, a plunge in open outlets occurred just days before the government introduced tougher measures to combat the spread of the virus, and mandated the closure of clubs and bars.

It seems that many businesses had already taken the initiative to close their doors before any government order. In Germany, voluntary closure of restaurants increased a few days earlier than in the Netherlands. On March 9, when the first COVID-19 deaths in Germany were reported, one-third fewer restaurants remained open compared to the Q1 weekly average.

Restaurants probably decided to shut down since more customers were staying home and shunning busy places in the wake of growing cases. Or they might have found it hard to enforce social distancing by seating diners at least 1.5 meters (5 feet) apart. Regardless of the reason, we can see from total sales volume below that this was a sudden, rather than gradual, dip in activity. It seems the rapidly escalating outbreak had little impact on public life – people were still going out to eat and drink as usual – but this was brought to a virtual standstill on the weekend of March 14.

We looked at sales volume in regions that were hit hardest by the pandemic – Germany’s North-Rhine Westphalia and the Netherlands’ Noord-Brabant province – to see if activity there differed from activity at a national level. But it appears that business and public behaviour in those regions were not significantly different from the rest of the nation, despite more stringent regulations being introduced there first.

In summary, the data demonstrates that even when the pandemic strikes close to home, it tends to be business as usual during the early days of the outbreak. However, businesses felt the impact earlier and acted quicker than governments did. While efforts to curb social interactions at a state or regional level can change public behaviour, not everyone will comply with the rules until there is a total shutdown.

About our data:
Suburbia partners with companies in the payments and retail industries to create data sets that track anonymized consumer purchases across Europe, delivering a daily view into some of the world’s biggest consumer brands. For insights on consumer packaged goods (CPG) trends, Suburbia’s data set covers sales in over 14,000 on-trade channels across six countries in Europe.