The Spam, Soup and Noodle Index: ‘Recession-proof’ Foods Do Well in the Downturn
In 2001, Leonard Lauder, chairman of Estee Lauder Companies, famously noted that during difficult economic times, sales of lipstick go up as female shoppers forego more expensive luxuries. He called it the “Lipstick Index.”
It was only a theory, and although retailers like to believe it, recent sales figures haven’t cooperated with Lauder’s idea. (Lipstick sales were down 5.8% in 2008.) During the current recession, a different indicator is emerging — and it goes in your mouth, not on it.
Spam – that glossy, pink canned pork product (not exactly ham, but made of pork shoulder and a few other odds and ends) – is among Advertising Age’s top “recession-proof businesses.” According to the magazine, sales for Spam – which was created during the Great Depression – “are up by double digits,” and its manufacturer, Hormel, has shifts working around the clock “to meet demand.”
Not surprisingly, soup topped the list, which also included Wal-Mart, laxatives, inexpensive beer, thrift stores and –bizarrely – mouth guards. (Apparently, the recession is causing some on Wall Street to grind their teeth while they sleep.)
Meanwhile, China has seen the emergence of its own low-cost food indicator: instant noodles, sales for which rose 8.6% last year, reaching $8.6 billion, according to Media magazine. That should be good news for Daisy Poon, president and CEO of noodle chain Ajisen China, whom China Knowledge@Wharton recently interviewed. According to Poon, the chain accelerated its expansion plans in 2008, opening more than 150 restaurants to reach a total of 340 outlets throughout China.