CHICAGO — Five factors could keep in-home consumption, which increased during lockdowns caused by the coronavirus (COVID-19), at elevated levels for a while, said Nick Modi, managing director at RBC Capital Markets, which is part of Royal Bank of Canada. The factors are societal, education, recessionary effects, unprecedented trial of brands and online ordering.

Modi spoke in a July 9 webinar put on by Information Resources Inc. (IRI), a Chicago-based market research firm.

The societal factor involves employees becoming comfortable working from home and companies noticing the real estate savings from work-at-home practices.

“This whole work from home versus commuting I think could have a really significant implication on how consumers behave with food,” Modi said. “You’re just going to have more time for breakfast.”

In explaining the education effect, he said students did not learn how to cook when many high schools took out home economics classes.

“The fact that consumers have not been educated on scratch cooking has been one of the biggest issues why we haven’t seen more meals prepared at home,” Modi said. “Well, all of a sudden, you have YouTube, and there’s Google.”

Given these resources on how to cook, more millennial parents are cooking at home for their families.

A recession may cut down on trips to restaurants. One person could eat a meal for $15 at a restaurant versus $4 at home.

“If you have a family of four, just think about the implications of your wallet during a recession,” Modi said.

Many people tried different brands during the lockdown as their favorite brands were out of stock.

“Not all of them will stick with that brand, but some will,” he said.

Companies may capture consumers’ interest much easier when they are shopping online versus shopping in the brick-and-mortar.

IRI in the webinar presented data on sales changes for edible consumer packaged goods in multi-outlets. The sales increased year-to-date by 2.6% in 2019 and were up 15% year-to-date so far in 2020. IRE forecasts sales in 2020 should end up in a range of 12% to 14% through June 12, 2020, when compared to the same time 2019. In 2021, IRI forecasts year-over-year sales to drop 4% to 6% for edible CPG sales when compared to 2020.

Not only large consumer packaged goods companies are reporting sales increases during COVID-19.

“One big myth that is going around is that this COVID is really helping the big manufacturers gain more share, and when we look at the data we really don’t see it,” said Krishnakumar “KK” Davey, PhD, president of strategic analytics for IRI.

He pointed to IRI data covering percent share of total store sales in US measured channels by the size of the CPG manufacturers. Large manufacturers, or those with over $5.5 billion in sales during a 52-week period, accounted for a 47.1% market share in 2019, but the share was down to 45.5% in an eight-week period ended May 17, 2020. The percentage market share for medium CPG manufacturers, or those with annual sales between $1 billion and $5.5 billion, accounted for a 16% market share in 2019 and a 16.1% market share in the eight-week period ended May 17, 2020. The percentage market share for small CPG manufacturers, or those with annual sales between $100 million and $1 billion, increased to 13.2% in the eight-week period ended May 17, 2020, from 12.6% in 2019.

The winter months and a successful vaccine for COVID-19 could impact US in-home consumption. Australia is about to enter its winter months.

“I’m paying very, very close attention to Australia,” Modi said.

He does not expect to see a vaccine before the end of 2020.

“I’ve been spending a lot of time talking to our biotechnologists at RBC,” Modi said. “Based on the information that I’ve collected, it doesn’t seem like that is a realistic scenario.”

A vaccine might be found in the first quarter or second quarter of 2021. The markets probably will respond after a vaccine is found, but questions could arise if the vaccine is not broadly distributed and an outbreak occurs somewhere, he said.

“I think it’s important that everyone understand for projecting and budgeting purposes, it’s going to be a very choppy ride despite a vaccine getting rolled out,” Modi said.