Major Changes in Grocery Retailing

ROCKVILLE, Md.Grocery retailing is experiencing some of the biggest changes in supermarket history, according to a new report from Packaged Facts.

The report, "The Future of Food Retailing: Shopper Insights and Market Opportunities," highlights that the greatest competition to supermarkets and grocery stores is from supersized stores like supercenters and warehouse clubs, however other retail channels like drugstores, dollar stores, limited assortment chains and online grocery shopping also pose a great threat. While supermarkets still play a major role in food shopping, the role is now shared with stores like Whole Foods, Trader Joe's which was recently named America's favorite grocery store, Wal-Mart, club stores and dollar stores on the value front, and farmers markets and food trucks in trend-setting. Also, 2012 and 2013 have seen more mergers and acquisitions in the retail food industry as buyers and private investors seek a way to expand their business to additional markets

Recent research has shown that consumers are not necessarily spending less, despite this popular notion, but rather they are spending smartly due to the economy and rising gas prices, food prices, healthcare costs and payroll taxes. Today, most consumers approach grocery shopping with preparation, with 85% of shoppers reporting that they do some type of planning beforehand, according to Packaged Facts Food Shopper Insights survey data. Moreover, only 37% of grocery shoppers cited often stopping by the grocery store on the spur of the moment. This is largely due to shoppers trying to save money. Two out of three grocery shopper agree with the statement "I buy a lot of groceries that are on sale or promotion," 47% used coupons or coupon codes during their most recent grocery shopping trip, 42% checked store circulars, 31% used store savings clubs/loyalty cards and 11% used coupon matching services.

Further, data showed 83% of shoppers cited being satisfied with the store(s) where they usually shop for groceries, 56% enjoy grocery shopping and 18% actively dislike grocery shopping. This suggests that retailers have room to improve in making grocery shopping easier, less burdensome and enjoyable for a significant amount of their customers.

"Economic, demographic, lifestyle and technological changes have created not only a fertile environment but the absolute necessity for new concepts to engage shoppers, capture share of stomach and re-invent food and beverage retailing," said David Sprinkle, research director for Packaged facts.