Consumers on weight-loss drugs buying less in certain grocery aisles, study finds

Dive Brief:

• Consumers using GLP-1 medication for weight loss are spending less in grocery stores, a survey of the purchasing behaviors of more than 100,000 panelists by Numerator found.
• The data showed that year-over-year net change in buy rates between GLP-1 weight loss users and non-GLP-1 users varied by category. Packaged bakery, snacks, prepared foods, and beans and grains had the largest divides among the groups at between 10% to 20%. Other departments like beverages and fresh meal kits were largely flat.
• The food and beverage industries have spent much of 2023 responding to investor concern that the popularity of weight-loss drugs such as Ozempic and Wegovy could sharply lower sales for items such as snacks and prepared meals.

Dive Insight:

While it’s not surprising that people taking weight-lost drugs buy less food, the Numerator data provides a glimpse of what could happen to CPG manufacturers if more people end up using the medications.

The overall buy rates at grocery stores during the last three months versus a year ago for those not using the medication dropped 3.9%. For those taking the drugs for weight loss of fewer than 15 pounds, the drop in buy rates was 11%, the Numerator data showed. 

Similarly, in ice cream, buy rates rose 3.9% for those not taking the drugs versus rates being down 9% for those using it to lose fewer than 15 pounds. In snacks, the figures were a drop of 2.1% compared to a decline of 8.8%. 

“We are in early stages,” Dr. Leo Feler, Numerator’s chief economist, said in a statement.

He said a year ago, nearly all the use of these drugs was for diabetes management, with only 10% of consumers using the medications for weight loss. Now, he said nearly half of people are using them for weight loss. 

Feler noted that an additional 20% of households said they are interested in taking the medicines to lose weight but are waiting for prices to come down and for more data to be released on the safety and efficacy of the drugs.

To be sure, this data, and the possibility of other, more effective weight-loss medicines, will go a long way toward providing clarity on how severe the impact will be on food and beverage companies. It’s also uncertain how long people who use the weight-loss drugs will keep taking them.

For now, CPG companies are keeping a close watch and wisely plotting how to change their portfolios once more is known about the drugs’ impact.

It’s not the first time a shift in consumer trends has sparked companies to change their products.

Coca-Cola and PepsiCo have introduced smaller cans in response to consumers cutting back on sugar; snack companies have increased the availability of 100-calorie count snacks for those aiming to consume less; and food makers across the board have reduced how much salt they include in popular offerings to appease Americans cutting back on sodium.

PepsiCo CEO Ramon Laguarta told analysts in August that the impact on his business has been “negligible” so far and that there are “obviously a lot of question marks.” Dirk Van de Put, Mondelēz International’s CEO, said “the whole topic has been overblown,” and that “it’s really not a big concern for us at this stage.” He predicted minimal impact on its volumes of about 0.5% to 1% in a decade. 

Sean Connolly, who oversees Conagra Brands, told investors that the Banquet and Slim Jim maker is pouring over data to assess food consumption patterns and determine which ones need to be incorporated into its product development. He said if consumers look to smaller portions to help them lose weight then the Chicago company could decide to change some of its portion sizes.