Increases in wine and alcoholic beverages indicate that consumers are opting to consume their favorite beverage at home too. At the same time they are continuing to avoid discretionary items, according to the latest monthly update of U.S. Retailing & Consumer Trends from The Nielsen Company.

The non-edible departments were the greatest contributors to an overall 1.2 percent unit sales decline at food, drug and mass-merchandisers, during the 52-week period ending July 11. General merchandise categories suffered most with a decline of 7.9 percent. Non-foods dropped by 3.8 percent and health and beauty aides by 3.5 percent.

Canning and freezing supplies saw the greatest unit sales increases at 18.1 percent followed by seasonal merchandise (8.3 percent), fresh meat (6.2 percent), wine (5.6 percent) and dry mix prepared foods (5.2 percent).

There was also a 3.7 percent unit sales increase in vitamins, a category that typically does well during times of recession as consumers focus on maintaining their own health.

“By and large the categories that are growing the fastest are those related primarily to meal consumption-a notion of back-to-basics,” says Todd Hale, SVP, Consumer and Shopper Insights at Nielsen. “It’s also interesting that the No. 1 item on the list is canning supplies. There’s been resurgence in consumers growing their own fruit and vegetables and canning them.”

Across all departments, dollar sales over the latest 52-weeks experienced a 2.7 percent increase, which was mainly seen in edible department. Fresh meat had the largest increase at 9.7 percent followed by packaged meat (6 percent), dry grocery (5 percent) and alcoholic beverages (4.6 percent). Discretionary departments and the dairy department, which has experienced significant price reductions as a result of falling commodity prices, ranked in at the bottom of the dollar growth scale. Non-foods (3.1 percent) and health and beauty aides (0.1 percent) showed little growth. Dairy (-1 percent) and general merchandise (-5.0) were the only departments reflecting loss.

“As prices for many commodities have dropped this year, retailers are slashing prices broadly to lure shoppers who are very focused on value and low prices,” said Hale. “As their competitors follow suit with price cuts, we are already seeing a number of retailers struggle to maintain positive same-store-sales growth.”

While food staples were also prevalent in the top-15 dollar growth categories, seasonal merchandise and canning and freezing supplies saw the largest increases with 34 percent and 27 percent growth respectively. Dry vegetables and grains, flour, and pasta, all with gains of 18 percent or more, rounded out the top five.

Moving forward, “we’re going to continue to see consumer restraint in terms of where they shop and how they buy,” said Hale. “Food and beverage categories will continue to do reasonably well. Those manufacturers selling discretionary categories are going to have to work very hard to give consumers a reason as to why they should be buying now.”

The recession gripping the U.S. has prompted many families to eat in and to entertain at home, and in many ways, return to basics in an effort to save money.  Many analysts are predicting that the changes being witnessed in consumer behavior will be permanent.  While these changes have had a negative impact on some sectors, others have benefited by adapting to the changing times and leveraging fundamental brand strengths.  Two such sectors — canning and freezing supplies, and gardening supplies – have posted solid growth over the past year, with canning and freezing supplies posting unit sale growth of 14 percent over the last 52-weeks, making it the lead category in unit sales growth across all mega-categories tracked by Nielsen within food, drug and mass merchandising (including Walmart).

Given the number of articles about how more households (including the White House) are planting gardens and raising their own produce, this growth is not all that surprising.  That said, it offers an excellent example of how manufacturers can continue to grow in a challenging environment by adapting to it.  Ball and Kerr, the leading brands in the canning and freezing supplies category, have been in this industry for over a century.  Yet because it has taken an innovative approach to marketing, it continues to be a relevant and successful company.  Its messaging has been simple and hits on some of the most important consumer themes: value, family and environment.  Their marketing has been effective not only because they offer value, but because it is integrated: they link to web sites that offer advice on canning and preserving, as well as highlighting new products.

Burpee Seeds, the nation’s largest mail-order seed company, is another example of a company making the most of the current environment.  It has reported record sales and has even sold out of some of its seed stock this year.  One element of its success: promoting the value gardening can offer by citing a study that claims $50 spent on gardening supplies can become $1,250 worth of produce a year, clearly a message with resonance in these uncertain times.

These are just a few examples of companies running complete and integrated marketing campaigns that have adapted to and capitalized on the changing mood and behavior of American consumers.  More CPG companies and retailers would be well-advised to follow the lead of these “old-fashioned” companies that have adroitly adjusted to the times.

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“Plain Rural Living” households — a Nielsen Spectra lifestyle segment that includes households in small towns and rural areas with the lowest population densities — account for 21% of all American households.  These households represented 43% of canning/freezing supplies product dollar sales, 31% of automotive product dollar sales, and 29% of tobacco and accessories product dollar sales.

Other categories skewing to rural households include insecticides, pesticides, and rodenticides, as well as fresh meat, flour, sugar/sweeteners, pet food, and carbonated beverages.

Nielsen’s Marketing Tip:
Retailers targeting rural households may want to promote these categories (above) with feature ads, displays, and product assortments. Manufacturers should consider cross-promoting and cross-couponing items in these categories.

Nielsen’s Dollar Volume Index identifies demographic groups that account for above or below average dollar volume purchases for a given product category.

Data for the index was collected via Nielsen’s Homescan consumer panel, a nationally representative sample of U.S. households that provides a stratified, proportionate, non-biased representation of the U.S. population. Homescan panelists scan all of their UPC coded purchases after every shopping trip, allowing Nielsen to capture their complete shopping and buying behavior.

Households headed by Americans age 65 and older account for 14.4% of all U.S. households.  These households represented 22.3% of vitamins product dollar sales and 20.8% of medications and remedies product dollar sales.

Other categories skewing to households with older people include pain remedies, canned fruit, and coffee, as well as canning/freezing supplies and floral/gardening supplies.

Nielsen’s Marketing Tip:
Retailers targeting households headed by older Americans may want to promote these categories (above) with feature ads, displays, and product assortments. Manufacturers should consider cross-promoting and cross-couponing items in these categories.

Nielsen’s Dollar Volume Index identifies demographic groups that account for above or below average dollar volume purchases for a given product category.

Data for the index was collected via Nielsen’s Homescan consumer panel, a nationally representative sample of U.S. households that provides a stratified, proportionate, non-biased representation of the U.S. population. Homescan panelists scan all of their UPC coded purchases after every shopping trip, allowing Nielsen to capture their complete shopping and buying behavior.