Latest / WOI Unfiltered / How GLP-1s are Impacting the Food & Bev Industry - Epi. 12
Transcript
- speaker-0: Alright, I just hit record. speaker-1: Wait a second, wait a second, let me grab coffee. speaker-0: We are live. Hello. Hi. I am good. How are you doing? You're prepping for a big trip. speaker-1: Yes, we had to Mexico tomorrow. Really looking forward to that. Seeing really great friends in Mexico City and then hitting the beach. It's a spring break in Chicago. So the next few weeks is a revolving door of various schools on spring break. So it'll be great family time. We're looking forward to it. speaker-0: That would be so fun. And you know what's funny is I always feel like I took you as a planner, a preparer, but your secret that I'm going to unveil today is that you've not packed anything. Is that correct? speaker-1: No, less than 24 hours flight, not one item packed, not one child packed, not one nail painted. And it's all going to happen. speaker-0: It's all gonna happen. I love it. Wait, now are your kids old enough that they pack themselves or do you pack for them? speaker-1: Rosie loves to pack for herself. yes, Sam could, but he likes me to do it and he is very easy to pack for. So no problem there. easy. Yeah. They don't care if they roll in the same thing every day. summer items easier than winter items. So I'm assuming I'm just going to breeze through this. I've told you about my clothing rental obsession as well, Jenna. So that haul is here. All that's going to go straight into the bag. speaker-0: are so easy to pack for. My kids would love to. speaker-1: We're halfway there. speaker-0: I love it. I actually have to tell you as a side story. your clothing obsession is newly, right? Renting from newly. And you got me renting from them for my last trip. I may have misunderstood the membership that I had signed up for. I thought it was like, only pay if you actually order clothes. So I paid for two months and didn't order clothes. And then I was like, ⁓ wait, I'm getting charged anyway. I might as well order something. So ⁓ I misunderstood the membership. speaker-1: Yeah speaker-0: but I do love them as well. So we'll see what I get in my next thing. I actually just ordered yesterday because I got an alert that I was charged and I was like, gosh, how do I always do this? Like, I don't know about you, but I always see those ads. Is it rocket money? No. I think it is rocket money. Whatever service it is that like they can find the subscriptions that you have, because a lot of people have duplicate subscriptions and help you cancel them. I really should do that one day. I'm pretty positive I pay a couple hundred dollars a month in random stuff that I don't know about. speaker-1: Well, I have a quite a story about that with LA Fitness and personal training session packs that we paid for for years. I don't even want to tell you to the tune of what that final bill was. And when I finally figured it out, they reimbursed one month, maybe two out of a two year not used membership. It was bad. It was really bad. And silly on my part, I will take full responsibility. speaker-0: I just had something similar. wasn't a two-year span, but it happened with one of my children. I had signed him up for soccer. We did it for a couple months, and then I thought I had canceled it, and in reality, I had placed it on hold. So after the hold was up, they just redid our subscription, but I paid for six months of it before I realized it, and they wouldn't reimburse me. They were just like, sorry, it's our policy. speaker-1: That's the lesson in scrutinizing your monthly bill for sure. speaker-0: All right, well, today we have a fun topic. We're going to talk GLP-1s We saw a recent piece of data about how some companies are responding and the changes people are seeing. And it just kind of spurred us going down a little rabbit hole to see what the impact has been on the food and bev industry. think a lot of us have been aware of the shifts and you've seen from a marketing perspective. people really started throwing that GLP-1 terminology out there. So that's not new. I I know that some food companies had rebranded, like when you could ⁓ the type of thing you're interested in, protein, keto, GLP-1 was one of them. So it's not new, but I do think because of the way that the food and bev and CPG industry works and the lag that they have in R &D and in launching products, we have started to see more of that in the last year. So I think some of the stats and data that we've uncovered have been really, really interesting. speaker-1: Yeah, yeah, and some unexpected in both ways, I would think. So the big one is a grocery spending drops about 5 % within six months of even just one human in the household starting in GLP-1, which is significant. That is a significant cut in spending. Snack purchases also decline as part of that, roughly 10%. That was a People magazine stat that we found. And then restaurant spending in certain categories, particularly QSR, has dropped around 8%. So some significant shifts, but then we're seeing some rises as well. speaker-0: Well, and I think if you look at the shifts, all downturn that you just talked about, you know, I'm relating it back to some of my own health journey and what we've talked about. And I think I had said before, since about July, I just started being more mindful of what I was eating. I had kind of gotten away from that with the little kids and all the crazy. And I just started being more mindful of And I also stopped. drinking as much, I know we've talked about, right, with your own journey. And funny enough, I did find that our grocery bills went down. ⁓ was taking a look when I was shopping and thinking, okay, well, I don't need those extra things are just gonna go to waste because I'm not gonna eat them. And then also translating that to wait, do my kids really need those three snacks or can we pull it back a little bit? So. My mindset for myself did impact what I was buying for my family as well. And we definitely saw a grocery bill dip. speaker-1: Yeah, it's something to absolutely be aware of. I would say maybe I would have tracked that Jenna had I closely monitored my credit card bills and apparently I don't do that. So I'm not sure if I'm seeing the same trend. But interestingly enough, when we're talking about the categories of food that are being cut, it is your frozen foods, it's your ultra processed foods, the stuff in the middle, not the perimeter necessarily. So the good news is health wise. there are some optimizations people are making on their health journey for sure, especially when it comes to how those dollars are being spent. speaker-0: Yeah. Well, and I mean, the trend isn't going away. I saw in some of our research, said 24 million Americans could be on GLP ones by 2035. So less than 10 years from now. So I think the fact that companies are taking notice and starting to make those shifts now is only going to benefit them. I mean, I think the volume eating is decreasing and the value and the variety. did see some stats about people are seeking more flavorful decisions, more spices. So you're seeing an uptick in sales in some of those areas where you can flavor that healthier food, which is really fun. And I think that'll, that'll yield some really strong trends too. The thing that caught our eye about this to start with. was what Lindt chocolates put out. And I don't have it in front of me. I don't remember the exact stat, but they were basically saying there was an increase in sales. 16 %? speaker-1: Correct. Yeah, it was high. can see that, but honestly, what this proves is the quality over quantity. The indulgence is still there. People aren't quitting that. They're just upgrading flavor profile. And even just seeing the headline, it completely tracks because you want to spend those calories, if you will, in a true enjoyable moment, like with a Richland chocolate. something that is satisfying, gives you the sweet ending, and before you can move on with your day. speaker-0: I think it's about choice, right? It's a choice to be able to have one piece of chocolate and not more and have that kind of restraint and that's very difficult. There's an influencer that I follow who had a post actually up the other day and it was a picture of a bowl of small chocolate. She's got a bunch of little kids. So it's a picture of a bowl of small chocolates that she had out and her post was talking about the fact that in the last several years she couldn't have done that. She couldn't have just put that bowl out and had maybe one sweet treat a night, you one small piece of chocolate. But since she got on the GLP-1, she's been able to put that out and have that little treat present and control herself and stop it once, which we all know, like, that's not easy. speaker-1: Yeah, do. Even if you're making healthy choices, moderation is difficult. speaker-0: Yeah, I mean the level of freedom that's affording people I think is really fun and cool and it's obviously shown in these Lint numbers. We also saw, can't remember if you mentioned this, like restaurants are getting hit too, right? People are making different decisions at restaurants and or not going to restaurants as much because a lot of US restaurants are volume based, right? You get a meal and it's thousand calories or more. And that's not what you would actually get or make at home. speaker-1: Yeah, well, and similarly with, you know, to attract this customer base, mini mini things, many tasting menus, many cocktail flights, there are still ways to attract the consumer in, even with these behavioral shifts in the way folks are being marketed to, right? Like the smart thing is to pivot your offerings at this to make it palatable and approachable for people on this weight loss journey. speaker-0: I agree. think those little like flights and little appetizer sized portions are really starting to rise at restaurants it's a little bit less about the dollar, right? Cause I think previously when you went to a restaurant, wanted to get bang for your buck. You wanted to get a full plate. Now people are wanting to get what makes sense for them from a health perspective and not have all this extra food that's just tempting them to take more bites. You also see brands are changing strategy. So from an advertising and marketing perspective, brands have been changing strategy. You're seeing a lot of more simple is better, that had around for a while. So I think there's already a lot of companies that were doing that. seeing a lot of brands that are leaning in to actually using the copy about GLP-1 friendly. That's become like a ⁓ huge marketing term lately, similar to what we saw for keto. And then I think you're also seeing some brands that are reformulating, like actually going back to their products and reformulating to truly become a more simplified version that people are looking for. speaker-1: Which it's high time for that. I think with the national conversation around ultra processed foods, additives that are hidden in everything that we consume, it's a really smart thing to do. It's a really difficult thing to do, but it's very important as people become more health conscious. And that stat that you said earlier, Jenna, about how many million in 10 years that is. speaker-0: That is 24 million. 24 million. Yeah, 24 million. that's a good portion of the population that's going out and buying the food and changing their buying habits. Yeah, it's funny too, if we go back to Lindt, when we were doing a little research, Hershey is actually calling GLP-1 adoption a headwind. speaker-1: Well, I mean, let's think how could they get around it like Lint. I mean, again, no, no fault of Hershey. You don't necessarily see them as the rich indulgence like Lint in terms of positioning Hershey you think of Mr. Goodbar certainly the Reese's peanut butter cup. It's indulgent. Yeah. You know, you kind of got to think about that snacking behavior. Reese's happened to be my favorite. My son is allergic to peanut butter. Rosie loves them. So we usually buy a two pack and we each take one. Rosie and I, and we eat it outside of the house. you know, maybe it's grab a partner. You kind of have to think about ways around this and their smaller size bits are usually safe for Halloween snack sizes. speaker-0: Well, and I feel like the only thing that comes to mind for them that is that little small poppable indulgence is the Hershey Kiss. But they're not formulated to be that rich, special piece of chocolate that you have. Correct. In the same way something like a Dove would be or the Lindt chocolate. speaker-1: Yeah. Absolutely. Dove falls in that quality category bar none for sure. Yeah, it makes sense. speaker-0: So, I mean, we'll see. mean, I do, it's funny though, I like what you were just talking about with Hershey. I think if they're reporting this as a headwind, then it is something where you can look at innovation and you can also look at marketing. So to your point, even from a marketing standpoint, talking about grab a friend or share, you know, things like that. But then from an innovation standpoint, I'm curious if in the next year or two they come out with, you know. some smaller packaged little goodies for people. speaker-1: Yeah, it's a good opportunity, but we also know that that kind of innovation can take time. Years, yeah. Yeah. While the habit seems like it takes seconds to form, you know, I think you're right, Jenna. It's a conversation that's bubbled in the last two years, very normalized within the last year. You're hard pressed to not know at least one to five people that are on a GLP-1 in this day and age. So how do you... catch up with that as quick as you can in a way that makes sense for your brand, both operating these giant budgets, but also that is genuine. I think Hershey's can do it, but I think it totally attracts that their headwinds feel different than a company like a Lindt. speaker-0: Yeah. I also am curious if this will cross into the influencer space. So I mentioned having seen an influencer that I follow talk openly about it. And if I rack my brain, I'm sure I can actually kind of gather up a couple influencers that I follow. It's funny you saw this in like the real housewives space. A lot of them talked about it. But what I haven't seen yet, and I could have just missed this, is companies who are changing marketing strategy and or changing product formulation aligning themselves with influencers who have openly talked about being on these GLP ones to put a more holistic campaign out about that. And I ⁓ think that's coming. If it's not already happening, I think that's probably coming to really kind of tie a bow on it and draw from that trust that the influencers already have. speaker-1: Yeah, it's a very smart strategy because they can speak authentically to it. It's quite that simple. And if people know these influencers based on this being their charge, what they believe in, where their content lies, it's a very easy leap. In fact, not a leap at all to align to a category or a brand that is doing the exact same thing. And honestly, it's a great way to earn trust quickly for brands by aligning to the right influencer. speaker-0: All right, well, the other thing I just want to mention, this is not GLP-1. we saw something come out from Fabletics. ⁓ And I'm curious ⁓ to watch where this So I guess to summarize, Fabletics, if you don't know, is an athletic, athleisure wear brand. lean heavily into influencer and celebrity support. They tend to be less expensive than something like a Lululemon or even Athleta. But they just came out with news that they are going to be launching their first piece of denim or denim line. So I am just. I don't know, it caught our attention and I'm just curious if this is indicative of a shift away from the athleisure wear into, I mean, I've already seen several brands that I like and follow launch new denim that's kind of coined as like almost sweatpants. So I'm just, curious about it. It's something to keep our eye on because it is another new consumer. speaker-1: Well, I also think it's behavior-based marketing, similar to the conversation of this pod with JLP-1s. As people go back to the office, as people emerge, even in a post-COVID world, I mean, that seems like eons ago now, but this year and last year felt like a real shift with back to work, multiple days a week, full days a week. And so the idea of dressing up just a little bit, even if you're shifting from athleisure to denim, It is a big leap. And so Fabletics is hinging on that And I think people will be excited about it as well, especially if you can wear denim comfortably. Let's be honest, there's not enough elasticity in denim. I agree. All right, Jenna. Well, this was a fun little pod. speaker-0: So and last question, as always, what's our impact? speaker-1: Yes. Well, you had a great one this week and I said I got back to volleyball, right? And we had gotten a conversation about lending our time, lending our resource and how that can be helpful and impactful for others and ourselves because we are feeling very rewarded when we do that. And coaching volleyball, that is something that is very rewarding for me. It's a lend of resource. is being there for young people. It's being there for the parent body. it's a lovely thing to give back on, especially when it one of your children like this does. But Jenna, we were talking about how lending time and resource is also fantastic in the business world. So you, you talk to us about that. speaker-0: Yeah. So I think that we recently made the decision to offer some pro bono services More come on that over social, in the near future. But we're excited about that. mean, when we talk about being a purpose led company and looking at what our impact is, giving back to Companies that we believe in and nonprofits that we really truly down to our core support is part of the reason we were founded. We also have made the decision that we will start to feature some nonprofits that we're passionate about on social in the coming months to give them a little bit of love and just show some of that like feel good work that's out there. And hopefully that resonates with our audience because you know it truly is just about supporting community, supporting others and giving back. So we're excited to be taking that step. More to come in the coming months, but that was our impact this week. speaker-1: That is lovely, Jenna. That's perfect. It makes me feel we've tied today in a bow and I'm looking forward to this work very much. speaker-0: Alright, ⁓ well thank you for your time this week. speaker-1: You too, have a good weekend. you ⁓