As low-income households are tightening their spending, American food companies are responding by increasing promotions and offering foods that are more filling. Charletta Reed, a resident of Chicago, is shopping for cheaper groceries at Dollar Tree, where everything is priced at $1. She is buying items like Hershey candy, canned mackerel, sardines, and jalapeño seasoning. Reed, along with many others receiving benefits from the supplemental nutrition assistance program (SNAP), are turning to more budget-friendly options.
Despite Dollar Tree being a popular choice for those using SNAP vouchers, the chain is seeing a decrease in revenue from this customer segment. This trend is also seen at Circle K convenience stores, where food stamp sales have dropped by 40% compared to the previous year. It appears that households with lower incomes are cutting back on their spending.
In the United States, a significant percentage of households have low incomes, especially among Black households. These demographics tend to consume less fresh food and meat, opting for more budget-friendly options. With the economic pressure, individuals are looking for value for money when purchasing groceries.
During the pandemic, food manufacturers focused on high-end products but are now shifting towards more affordable options to attract cost-conscious customers. Companies like Hershey, Conagra, and Coca-Cola are offering lower-priced products and promotions to appeal to this customer segment. Additionally, manufacturers are emphasizing foods that provide longer-lasting satisfaction, such as Andy Capp’s corn snacks and sunflower seed snacks.
As food companies strategize to regain sales among low-income consumers, they are implementing discounts, promotions
