Consumers are voting with their wallets—and some of America’s best-known food brands are losing.
Coffee drinkers are leaving Starbucks’s loyalty program. Chips Ahoy cookies are lingering longer on grocery-store shelves. Fewer customers are ordering at fast-food drive-throughs and kiosks, pressuring companies such as Wendy’s and McDonald’s.
For about three years following the Covid-19 pandemic, food companies pushed through a series of sharp price increases, saying they needed to recoup their own rising costs—and that consumers would adjust to stick with their favorite brands. As a result, the portion of U.S. consumers’ income spent on food has reached the highest level in three decades.
Now, some consumers are hitting their limits. Restaurant chains and some food manufacturers are reporting sliding sales or slowing growth that they attribute to consumers’ inability—or refusal—to pay prices that are in some cases a third higher than prepandemic times.
“I’m done.” Consumers, fed up with rising prices at restaurants and supermarkets, pull back from Chips Ahoy cookies, Starbucks coffee and other big food brands. https://t.co/FiKOPd0u4G
— WSJ Business News (@WSJbusiness) May 5, 2024