2 - min read
I had no idea in 2006 when I launched Barney Butter that we’d be in a full recession two years later. Surprisingly, the brand survived – no, thrived – during that time. Today, in the wake of a struggling economy, we are seeing positive growth in premium/natural foods as a whole. This is great news, but it takes more than rising tides to survive in this industry.
The years 2005 – 2012 are now called the Great Recession, and had I known what was going on, I might have panicked and quit. Who launches a product that is 3X more expensive than the most expensive item in the set during a recession?
The crazy thing is, we were doubling sales every year during the worst GDP and unemployment rate since the early 90’s recession.
Today’s economic times feel just as scary. We have had two economic quarters of negative growth. That is the definition of a recession. But when you look at food, natural food sales growth is outpacing all of food growth.
This is different than during the Great Recession when food sales decreased overall. While most shoppers turned to bargain hunting across food categories, the natural shopper, who tended to be higher income, did not change behavior. It was a smaller consumer segment, with a less democratized consumer base. Brands that did well, like Barney Butter, really leaned into this segment, and as KIND founder Daniel Lubetsky recalls, it was a time when KIND got aggressive with their marketing.
The natural shopper is more diverse today, and although inflation may be dampening the effect, in general we are seeing natural food sales increase during this recession. A broader span of income levels have been spending on healthy, high quality food during this downturn. While a wider audience is great for brands, I’ll argue increased competition and rising supply chain costs make this time different, but not less challenging than in the past.
Next week, a deeper dive into the premium/natural segment and what your brand can do to ensure growth post-Covid.
All my best,
Jennifer