State of the Grocery Market:

86% of all adults now say they have at least some of the responsibility for household grocery shopping. This is an important change because it is bringing in more consumers to the grocery retail world. In the past grocery shopping was fulfilled by one person, now that is only the case in 25% of US households. So, 75% of US households split the grocery shopping responsibility in some way making it a team sport. Sharing the shopping responsibility didn’t affect the number of trips like you would think. That number is around 1.6 trips per week and has remained fairly constant over the past 5 years. However, these lifestyle changes have made the biggest impact on trip frequency.

Increases Trips:

• Reduced planning for meals
• Urbanization (People live, work, play, eat and shop all in the same neighborhood)
• Desire for freshness

Decreases Trips:

• Sharing the shopping responsibilities
• Migration to online
• Increased reliance on food services

The average weekly spend for a household is $113.50 which aligns with inflation. Of the shoppers that were surveyed only 13% spend all of their grocery budget at one retailer. The typical shopper visits 3.1 channels and up to 4.4 different banners each month to fulfill their grocery needs. This show cases how many different options are out there and that consumers don’t mind shopping around.

Online Marketplace:

The usage of online retailers has grown from 16% in 2015 to 33% in 2019. Millennials are still the highest users but Gen X is a close second, while the percent of Boomers and Mature users have plateaued. Most likely growth in online will come from increased usage as opposed to new users. 43% of people say they have shopped online for groceries in the past year, 21% shop regularly (once a month or more) and 10% shop frequently online. (once or more every 2 weeks) Interestingly the 10% (frequent shoppers) may account for 40% of a retailer’s online purchases.

Who are frequent online shoppers?

• 55% Males
• Millennials/Gen X
• Parents
• College Educated
• Urban

Online shoppers are known to visit even more banners and channels than traditional shoppers do. Surprisingly, online users still shop in-store and spend just as much as shoppers who only shop brick and mortar. With a multitude of options this is the breakdown of how online shoppers are buying: 13% same/next day delivery, 17% home delivery, 17% pick up at store/kiosk and 8% auto renewing deliveries. To stay competitive, stores need to offer some sort of online grocery option or else shoppers will click elsewhere. Certain features should also be looked into when deciding what kind of online options a store should offer. When asked, consumers wanted the following features from online shopping: their purchase history, easier returns, subscribe and save and connectivity with other devices like Google Home or Echo speakers.

Center store continues to dominate online sales. Here are the top 10 categories salty snacks, paper products, packaged/canned foods, HBC, household cleaning, coffee/tea, sweets, condiments, pet food/treats and ready-to-drink beverages. Consumers are still leery about ordering fresh categories online but even those categories numbers are beginning to rise. Safe to say that online shopping will continue to grow into other areas of the store as efficiency and freshness issues are addressed.

Today’s Grocery Shopper

Health and wellness were one of shopper’s main concerns in 2018. Although that trend has continued into 2019 consumers now want their shopping experience to be personalized. Let’s address health and wellness first. What does eating well look like to the shopper? 84% ate tasty foods and beverages, 76% ate nutritious foods and beverages and 73% ate within their budget. How did this affect the choice of a primary grocery store? 78% want high quality fruits/veggies, 76% low prices and 46% want stores to be open and honest about nutritional info. The health and wellness movement also brought along a trend some have called label gazing. Consumers are paying extra attention to nutrition panels and 82% say they now look for at least one front-of-package claim.

Personalization can drive customer loyalty. Shoppers want a customized experience and want to be understood personally. They also want grocery retailers to satisfy their households needs and preferences. Pretty easy task, right? Of course not. How can you design a tailored shopping experience for each one of your customers? Simply put you can’t, but the best way I have seen it put is that you need to be a store that helps shoppers buy what they want to buy, not sell what you want to sell. Putting emphasis on this can make your shoppers trip feel more personalized.

In summary today’s grocery landscape has changed. Households are sharing the shopping responsibilities which brings more consumers into grocery retail. With more grocery options than ever it is critical to know what shoppers want and what they look for in a store. Shoppers are spending their money in multiple places so capturing as much of that spend is important whether that be in-store or online. Shoppers have accepted the benefits of online shopping and it is now becoming a mainstream behavior. Brick and mortar still proves itself worthwhile but adding online not only makes you competitive it adds an additional channel to reach today’s grocery shoppers.