“Purchases [in 2021 and 2022] were happening much further out from the holiday... It had to do with a lot of the out-of-stocks that we were dealing with in ‘21 and ‘22, which pushed some of the more crucial items for these types of holidays to earlier weeks. What we saw in ‘23, whether I look at Halloween or I look at Thanksgiving, a lot of the purchases are now taking place again during the week of the holiday.”
Cottage cheese has a moment, as the dairy category shakes off egg prices
This year, egg prices have driven up dollar growth within the dairy category for the year, and Thanksgiving shopping propelled units slightly higher in November, Roerink said.
Dairy sales totaled $72.4bn, growing 5.3% in dollars and declining 1.4% in units, according to Circana MULO data for the 52 weeks ending Nov. 26, 2023. In November, dairy sales came in at $6bn, declining 5.1% in dollars and growing by 0.1% in units, as egg prices began to stabilize.
“Dairy is the one [category] where we had all that egg inflation sitting and are still really affecting that 52-week look. That's why those prices are still up. But if you just look at November or the third quarter, for instance, that's really when those egg prices were starting to stabilize, and it's really that deflation in the category that is determining a lot of the dollar performance right now for dairy with eggs being one of those big, big sellers.”
Desserts, dairy-alternative cheeses, and processed cheese saw the steepest drop in units, declining 10.5%, 7.8%, and 3.6%, respectively, for the 52 weeks ending Nov. 26, 2023. Similarly, in November, desserts and dairy alternative cheese were among the sharpest declines (9.5% and 8.6%, respectively), while cheese snacks dropped 10.8%.
In terms of growth, natural cheese, whipped toppings, and cottage cheese all saw unit increases, growing 1%, 2.1%, and 7.7%, respectively, for the 52 weeks ending Nov. 26, 2023. In November, cottage cheese unit growth accelerated 14%, whipped toppings units increased by 4.9%, yogurts by 2%, and natural cheese by 0.7%.
Cottage cheese has been “climbing the ranks,” and retailers looking to capitalize on the movement can use promotions and other activities to introduce consumers to the product, Roerink noted.
Hybrid meals propel prepared deli side of business
In the deli department, prepared items are outperforming the rest of the segment, as the overall category sees some softness in November.
Department deli sales came in at $46.1bn, increasing in dollars by 4% and decreasing in units by 1.4% for the 52 weeks ending Nov. 26, 2023, per Circana data. In November, deli sales came in at $3.5bn in dollar sales, registering a 0.5% decrease in dollars and a 0.8% drop in units for the month.
Deli meats, which included grab-and-go, pre-sliced, and service options, sold $8.3bn, growing 0.4% in dollars and decreasing 5.6% in lbs. In November, deli meat saw steeper declines with sales coming in at $599m, declining 4.1% in dollars
Similarly, deli entertaining items saw softness in recent months. In November, deli entertaining sold $386m, declining 1.7% in dollars and 2.2% in units. The loss was across all deli entertainment categories, including dips and sauces, trays, spreads, pickles/relish, and holiday meals. Among the steepest unit declines, holiday meals shrunk by 31.2%, spreads by 3%, and trays by 2.1%, though trays managed a 5.4% growth in dollars.
Despite overall declines in the deli, deli prepared managed to grow both in dollars and units. Deli-prepared sales come in at $24.9 billion, growing 5.9% in dollars and 0.6% in units, for the 52 weeks, ending Nov. 26, 2023. For November, deli-prepared sales were $1.9bn, growing 0.9% in dollars, and 0.5% in units.
Pizza units increased by 10.1%, prepared meals by 2.9%, side dishes by 2.6%, and entrees by 1.7, for the 52 weeks ending Nov. 26, 2023, per Circana MULO data. For November, prepared meals grew by 6.2% in units, pizza by 3.2%, side dishes by 3.2%, and entrees by 1.5%.
“For years, grocery stores have struggled getting those deli-prepared items to really be a replacement for restaurant meals, that seems to be finally happening. I think the assortment is getting to the point where consumers are starting to think about it as a restaurant replacement, and certainly, the prevalence of hybrid meals in which they cook some items themselves and then introduce some items that are either heat-and-eat or ready-to-eat from the deli, that seems to be where a lot of the meal preparation is growing."