Table of Contents
Executive Summary
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- Impact of COVID-19 impact on grocery retailing
- The issues
- COVID-19 provides at least a short-term boost to grocery sales
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- Figure 1: Multi-outlet sales and forecast of groceries, at current prices, 2014-24
- Most grocery shopping still happens in-store, but online is gaining
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- Figure 2: Grocery shopping methods, December 2019
- Traditional supermarkets remain the top choice
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- Figure 3: In-store retailers for grocery shopping, December 2019
- The opportunities
- Sampling and locally grown foods appeal most strongly
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- Figure 4: Interest in in-store products and services, December 2019
- List-making still a priority and set to gain momentum amid COVID-19
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- Figure 5: In-store shopping behaviors, December 2019
- Opportunity to reinforce young adults’ enjoyment of grocery shopping
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- Figure 6: Attitudes toward in-store shopping, by age, December 2019
The Impact of COVID-19 on Grocery Retailing
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- Figure 6: Short, medium and long term impact of COVID-19 on Grocery Retailing, April 2020
- Opportunities and threats
- Food dollars shift from foodservice to grocery retail
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- Figure 8: Coronavirus lifestyle changes – food spending, March 2020
- Grocery retailers struggle to keep up with demand, keep shoppers, employees safe
- More grocery shoppers go online, or try
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- Figure 9: Coronavirus lifestyle changes – online shopping, March-April 2020
- Shoppers shift from spontaneity to stocking up
- Supply chain disruptions will be a growing issue
- Opportunity to focus on community support and local foods
- Retailers offer ideas
- Tentative steps toward normal?
- Impact on grocery retailing
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- Figure 10: Multi-outlet sales and forecast of groceries, at current prices, 2014-24
- How the crisis will affect grocery retail’s key consumer segments
- Recession could strengthen young shoppers’ preference for value-driven retailers
- How a COVID-10 recession will reshape the grocery retailing industry
- Other channels outpace supermarkets and are likely to gain further in a recession
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- Figure 11: Multi-outlet sales and forecast of groceries, by channel, at current prices, 2014-24
- The need to economize will drive continued private label growth
- COVID-19: US context
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The Market – What You Need to Know
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- Only slow growth prior to COVID-19 pandemic
- The trend reversed in March as consumers stocked up on groceries
- Even before the pandemic, a bias toward cooking at home from scratch
Market Size and Forecast
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- COVID-19 provides at least a short-term boost to grocery sales
- Note concerning COVID-19 and this forecast
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- Figure 12: Multi-outlet sales and forecast of groceries, at current prices, 2014-24
Market Breakdown
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- Other channels outpace supermarkets and are likely to gain further in a recession
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- Figure 13: Multi-outlet sales and forecast of groceries, by channel, at current prices, 2014-24
- Food and drink likely to extend its dominance of grocery sales
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- Figure 14: Multi-outlet sales of groceries, by category, at current prices, 2014-19
Market Perspective
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- Before COVID-19, foodservice had been gaining on in-home food
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- Figure 15: Sales of in-home food and of dining out, at current prices, 2014-19
- The trend reversed in March as consumers stocked up and cut back on restaurants
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- Figure 16: Coronavirus lifestyle changes related to food and shopping, March-April 2020
- Younger shoppers more likely to stock up on groceries, shop online
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- Figure 17: Coronavirus lifestyle changes related to food and shopping, by age, March 27-April 2, 2020
Market Factors
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- Cooking at home is a necessity amid COVID-19 but can also be rewarding
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- Figure 18: Correspondence analysis – symmetrical map – food and drink priorities for different meal types, September 2019
- Even before the pandemic, a bias toward cooking at home from scratch
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- Figure 19: Meal type frequency, August 2019
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- Figure 20: Eating habits, by age, September 2019
Key Players – What You Need to Know
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- Offering a little help
- The blurring of grocery retail and foodservice
- Tentative steps toward normal or steps in a new direction?
What to Watch
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- Offering a little help
- Trader Joe’s
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- Figure 21: Trader Joe’s Stay at Home Soup Instagram post, April 2020
- Mariano’s Meet-Ups
- Jungle Jim’s
- Northgate González Market
- Blurring of grocery retail and foodservice, with a focus on local
What’s Next
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- Tentative steps toward normal?
- Or steps in a new direction
The Consumer – What You Need to Know
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- Shopping frequency likely declining amid COVID-19
- Most grocery shopping still happens in-store, but online is gaining
- Supermarkets still the top choice, but younger shoppers look elsewhere
- Shopper channel preferences reflect range of strategic priorities
- List-making still a priority and set to gain momentum amid COVID-19
- Typical frustrations grow more significant amid COVID-19 crisis
- Opportunity to reinforce young adults’ enjoyment of grocery shopping
- Sampling and locally grown foods appeal most strongly
- Interest in saving money and time will help drive use of shopping apps
Grocery Shopping Overview
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- Most adults do at least some grocery shopping
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- Figure 22: Grocery shopping responsibility, by gender and age, December 2019
- Shopping frequency likely declining amid COVID-19
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- Figure 23: Grocery shopping frequency, by gender and age, December 2019
- Most grocery shopping still happens in-store, but online is gaining
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- Figure 24: Grocery shopping methods, by age, household income, and household size, December 2019
- Major categories online vs in-store
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- Figure 25: Major grocery categories online vs instore, December 2019
In-store retailers for Grocery Shopping
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- Traditional supermarkets remain the top choice
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- Figure 26: In-store retailers for grocery shopping, December 2019
- Younger shoppers more likely to make Walmart their top grocery choice
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- Figure 27: In-store retailers for grocery shopping – Top three, by age, December 2019
Reasons for Selecting In-store Retailer Used Most Often
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- Proximity a key deciding factor in store selection
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- Figure 28: Reasons for selecting in-store retailer used most often, December 2019
- Older shoppers especially likely to value proximity and quality
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- Figure 29: Reasons for selecting in-store retailer used most often, by age, December 2019
- Shopper channel preferences reflect range of strategic priorities
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- Figure 30: Reasons for selecting in-store retailer used most often, by in-store retailer used most often, December 2019
In-store Shopping Behaviors
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- List-making still a priority and set to gain momentum amid COVID-19
- Modest adoption of streamlined checkout options
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- Figure 31: In-store shopping behaviors, December 2019
- Older shoppers more likely to follow a set shopping routine
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- Figure 32: In-store shopping behaviors, by age, December 2019
Frustrations with In-store Shopping
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- Typical frustrations grow more significant amid COVID-19 crisis
- Time spent in the store
- Out-of-stock products
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- Figure 33: Frustrations with in-store shopping, by age, December 2019
Attitudes toward In-store Grocery Shopping
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- A generally positive view of in-store shopping
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- Figure 34: Attitudes toward in-store shopping, December 2019
- Opportunity to reinforce young adults’ enjoyment of grocery shopping
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- Figure 35: Attitudes toward in-store shopping, by age, December 2019
- Warehouse club and discount grocer shoppers likely to appreciate store brands
- Shopping experience key in competition between traditional and natural supermarkets
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- Figure 36: Attitudes toward in-store shopping, by in-store retailer used most often, December 2019
Interest in In-store Products and Services
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- Sampling and locally grown foods appeal most strongly
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- Figure 37: Interest in in-store products and services, December 2019
- Natural supermarket shoppers most interested in fresh produce concepts
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- Figure 38: Interest in in-store products and services, by in-store retailer used most often, December 2019
Interest in Shopping App Functions
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- Interest in saving money and time will help drive use of shopping apps
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- Figure 39: Interest in shopping app functions, by age, December 2019
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Fan chart forecast
- Consumer survey data
- Consumer qualitative research
- Abbreviations and terms
- Abbreviations
- Terms
Appendix – The Market
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- Figure 40: Total US sales and forecast of market, at inflation-adjusted prices, 2012-22
- Figure 41: Supermarket sales of groceries, by category, at current prices, 2014-19
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Appendix – The Consumer
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- Figure 42: Food and drink priorities for different meal types, September 2019
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