Summer is upon us, and travel season is in full swing. In a recent survey, covering 11 countries and 4,700 respondents, 79% of travelers said they were planning a trip in the June to August 2023 period.1 While travelers may be excited to take part in summer adventures, it may come at a premium. While inflation is down overall, pricing challenges remain across various goods/services.
Transportation
For those preparing to take road trips this summer, the national gas average per gallon, while still elevated, has softened to $3.58 as of June.2 The U.S. Bureau of Labor Statistics reports gasoline prices are down 20% versus last year.3 The declining fuel costs might lead vacationers to opt for a road trip this summer, as transportation costs, including air travel, are up 10% for the same timeframe. In addition to inflation, demand is contributing to higher prices, as travel continues to surge post-pandemic. Airfares, lodging, meals, and rental cars, are up overall 16%, compared to May 2019. May 2023 airfare rates, compared to May 2019, are up 5.4%. During the same period, hotels are up 15.2%, while rentals are up a staggering 47.9%.4 The rise in prices gives travelers a lot to consider prior to finalizing their itineraries.
Hydration Necessities
Regardless of if consumers are traveling, or staying local, shoppers are reaching for summer necessities. Staples including water, frozen desserts, and alcohol are capturing consumer spend. With inbound sweltering heat, it’s important to stay hydrated. All shelf stable water segments posted growth, versus the prior period, for the most recent 4 weeks ending 5/21/23. Shelf stable non-carbonated flavored water products, representing 10% ($154M) of water sales, grew the fastest at +4.1% compared to the prior month. Top growing flavors included watermelon (+53.3%), assorted (+17.2%) and pineapple (+9.4%).
SPINS: Natural Channel & Conventional Multi-Outlet (powered by Circana, formerly named IRI); 4 weeks ending 05.21.23 ; Dollar Chg. vs Prior Period
Smaller segments, like water sparkling (+12.1%), and refrigerated(+11.3%) and shelf stable coconut and plant water (12.5%), saw increases from the previous month. This indicates consumers are seeking variety when it comes to their beverages and hydration products.
Chillin’ Out
Another way consumers seem to be beating the already present heat, include enjoying frozen desserts. Within this category, all subcategories posted growth over the prior period, except for frozen pies and other desserts and frozen sorbet. Frozen novelties and frozen plant-based novelties posted strong double-digit growth compared to the prior month. Frozen novelties’ sales increases were widespread across all product positioning groups. Frozen plant-based novelties posted growth across all positioning groups, except for specialty positioned products. Assorted (+14.5%) and vanilla (+11.3%) were the top flavors for frozen novelties. Vanilla (+9.7%) was also a top performing flavor for frozen plant-based novelties, along with chocolate nut (+10.3%) and caramel (+12.8%).
SPINS: Natural Channel & Conventional Multi-Outlet (powered by Circana, formerly named IRI); 4 weeks ending 05.21.23 ; Dollar Chg. vs Prior Period
Grill-ables
Summer isn’t complete without backyard barbecues. The global barbeque grill market hit $22.7 billion in sales and is expected to register a compound annual growth rate (CAGR) of greater than 4% over the next 5 years. Changes in young consumers’ lifestyles and eating habits, as well as the growing trend of outdoor parties and social gatherings, have increased grill demand. This factor is expected to contribute to the industry’s growth in the coming years.5
Leading into summer, grilling consumers spread their dollars across both animal-based proteins, as well as plant based. Frozen and refrigerated burgers (+14.6%), Frozen and refrigerated hot dogs (+11.8%), and frozen plant-based burgers (+4.5%) were among the fastest growing segments, compared to the prior period. Households have changing and evolving preferences when it comes to their day-to-day eating occasions, and backyard barbecues are no different. Offering a variety of animal-based and plant-based grill options will go a long way with family and guests.
Kickin’ Back
At the end of a long summer day, sometimes there is nothing better than kicking back and reaching for an alcoholic beverage to unwind. All categories within the alcohol department, posted growth, expect for wine, versus the prior month. The alcohol department in total was up (+2.6%) for the most recent 4 weeks, with several bright spots that seem to resonate with consumers leading into summer months.
Subcategories such as flavored malt beverages and other (+12.6%) and ready-to-drink cocktails (+21.9%) posted strong growth for 4 weeks ending 5/21/23 versus the prior period. Within flavored malt beverages, hard seltzers account for 50% of total sales ($128M) and contributed $117M in incremental sales, or +38.9% towards total segment growth. The refreshing cool notes of the seltzers and convenience of ready-to-drink cocktails, make them the perfect summertime choice.
SPINS: Natural Channel & Conventional Multi-Outlet (powered by Circana, formerly named IRI); 4 weeks ending 05.21.23 ; Dollar Chg. vs Prior Period
Stay cool, hydrated and cheers to summer!
Sources:
https://www.iata.org/en/pressroom/2023-releases/2023-05-16-02/#:~:text=The%20survey%20covering%204%2C700%20travelers,the%20June%2DAugust%202023%20period 1
https://gasprices.aaa.com/state-gas-price-averages/ 2
https://www.bls.gov/news.release/cpi.nr0.htm 3
https://www.nerdwallet.com/article/travel/travel-price-tracker 4
https://www.giiresearch.com/report/moi1258764-barbeque-grill-market-growth-trends-covid-impact.html 5
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