JACKSONVILLE, Fla. — Acosta has compiled their top 20 CPG predictions for 2020, including higher demand for pet products, integration of the in-store and online shopping experience and non-traditional channel growth.

“We expect to see continued growth in many of the categories that took off in 2019 such as self-care, CBD and plant-based food,” said Colin Stewart, executive vice president of business intelligence at Acosta. “Additionally, in 2020, retailers will focus on becoming more environmentally conscious, sourcing locally, keeping prices low and making the in-store shopping experience more enjoyable and tech-friendly.”

Acosta’s top 20 CPG predictions for 2020, grouped into four categories, are:

Macro Consumer Predictions

1. Focus on Self-Care: $9.9 billion self-care industry is expected to continue growing.

2. Experience-Based Shopping: Brands building memorable experiences will cash in, thanks to Millennials.

3. Emphasis on Sustainability: With 73% of consumers willing to change their purchase habits to improve the environment, retailers will focus on eco-friendly initiatives.

Category/Brand Predictions

4. CBD Goes Mainstream: With 28% of consumers already using CBD oil, and another 54% open to trying it, CBD sales are projected to grow from just under $2 billion in 2018 to $20 billion by 2024.

5. Plant-Based Everything: Sales of plant-based food grew by double digits and at five times the rate of total food sales in the past year, with continued growth expected.

6. Consumers “Begging” for More Pet Products: Pet food will continue to be a driver for brick-and-mortar sales as well as in e-commerce, which grew by more than 50% last year.

7. Comeback of Premiumization: With the economy going strong, consumers will be eager to trade up to premium products to indulge or treat themselves.

8. Further Expansion of Functional Foods and Beverages: With ‘healthfulness’ becoming increasingly important to consumers — nearly two-thirds of U.S. adults agree that it has a significant impact on their food and beverage purchase decisions — sales of food and beverages with added nutritional benefits, like electrolytes, minerals, adaptogens, and prebiotics, are expected to reach $275 billion by 2025.

9. Rise of Private Brands: The private brands market, which represented almost one in five consumer packaged goods dollars sold last year, will continue to grow.

10. Reduced Access to E-Cigarettes and Tobacco: Retailers’ focus on health and wellness will continue to outweigh their sales focus on non-healthy products with certain chains no longer selling tobacco-based products.

11. Buying Local Continues: With consumers becoming increasingly aware that locally sourced food will be fresher, support regional economies and generate fewer carbon emissions, retailers will need to differentiate their assortment at the local market level to entice customers.

Shopping Experience Predictions

12. Retailers Double Down on Remodels: Major retailers will incorporate more fresh foods space, online order solutions like in-store kiosks and easier checkout options, including cashierless technology.

13. Focus on Store Experience: Most consumers like a brick-and-mortar store experience that delivers sights, sounds and smells, and retailers can keep customers further engaged with events like cooking demonstrations.

14. Mobile-Enabled Shopping in the Store: An estimated 53% of all purchase decisions are digitally influenced, so a seamless integration between the store and the digital experience is imperative.

15. Path to Purchase is No Longer Linear: Loyalty will become more fragmented, with 87 percent of all shoppers and 94% of Gen Z/Millennial shoppers using smartphones, shoppers can move seamlessly between both physical and virtual channels to meet their household needs.

16. Continued Perimeter Improvement: Prepared foods, which topped $12.5 billion in sales last year, will continue to be a heavy-hitter on the perimeter.

17. Low Price is Table Stakes: Retailers will continue to press for non-negotiable low prices to remain competitive.

Store Operations Predictions

18. Supply Chain Focus: Retailers will focus on increasing on-shelf availability and lowering inventory costs by leveraging inventory optimization solutions and demand-based systems.

19. Expanded Grocery Delivery and Pickup Options: Online grocery spending is expected to more than double by 2023, with the 21% of U.S. shoppers buying groceries online this year expected to grow significantly as retailer click and collect and same day grocery solutions expand.

20. Non-Traditional Channel Growth: Strong sales growth is projected for small store formats and club channel retailers, which are succeeding by offering differentiated items, whether it is a focus on better-for-you, local/specialty/curated offerings, or by providing value through their own brands.

Acosta’s top 20 CPG industry predictions for 2020 were compiled by Acosta business leaders across the country and supported by analysis and custom research by Acosta Strategic Advisors.