COVID-19 Impact Analysis Series Article One: Behavioral Changes in Food Preferences

Are people concerned with a particular type of food?

Author: Anil Raparla (March 21, 2020)

THIS COVID-19 impact analysis series designed by Punchh’s data team aims at sharing the real-time insight we have discovered when we study our consumer behavior data set. In this first article, we highlight the changes in the consumer’s food preference.

It has been a tumultuous month of March. WHO has very recently announced the COVID-19 outbreak a pandemic, while the epicenter has shifted from China to the west. Our analysis confirms that COVID-19 has begun to show a material impact on the US restaurant industry.

We have discovered that consumers are purchasing fewer quantities of uncooked food upon the arrival of the virus breakout. We study the city of Seattle, i.e. US’s coronavirus ground zero. We show our results aggregated out of six restaurant chains, whose stores are within Seattle zip codes, Feb-12 — Mar-18. The event date is Mar-01. The weekly orders of the salads item category have declined more rapidly than that of the general stores. In the below figure, we show the sales numbers of 10 randomly selected items. We highlight the three items that have suffered the largest decline within the sample (-88%, -74%, and -56%), two of which belong to the salads item category. The largest drop is Beverages because customers do not eat at the restaurant.

To validate if we have identified a true trend, we have investigated the sales for all items named “salads” in the hard-hit states, Washington and California. Here is the key insight: out of the 91 salad items exceeding an order quantity of 100 in the pre-period, 57 items showed a decrease in sales quantity more than -22.8%, the total sales decline for the Seattle city. One plausible explanation is that the salad items are usually consumed by health-conscious consumers. During the COVID-19 outbreak, the consumer group has started to reduce the intake of salad, uncooked food or any food of similar matter. The concern is these food items have a higher chance of contamination.

This observation brings in an important piece of insight for the restaurant business owners, who are planning to strategize their marketing operations during this difficult period.

In the next article, we will discuss our observations on restaurant foot traffic. So, stay tuned.