At its annual trade show in February 2018, the National Grocers Association unveiled a landmark study showing distinct changes in consumers’ purchasing behaviors and outlining growth opportunities for its members. Conducted by The Harris Poll on behalf of NGA, the survey revealed that although buying habits stayed consistent across the board, the purchase of food items such as beef, seafood, deli, and baked goods declined in 2017. Key reasons for the slump vary by food item. According to the report, fewer people purchased seafood because of price; while dietary changes influenced consumers to buy less beef and baked goods.
3,008 shoppers, aged 18 and older, who self-identified as spending 50% or more of their grocery shopping at an independent grocery store were surveyed for the report from November 13 to December 8, 2017. For these “independent shoppers,” convenience, followed by price, keeps them loyal to their local supermarkets. Although shoppers said location and price were main reasons for switching stores, a majority (2 in 3) were very satisfied with their local grocers and, in the past year, only 14% have changed supermarkets.
NGA members also observed these changes. “25 years ago, people didn’t care if things were organic,” says Jennifer Doherty, owner of the Manhattan Fruit Market in Chelsea, New York. Doherty has been in the grocery business for over two decades. In the early days of her retail career, Doherty says shoppers were more “price-conscious.” “Now more people are asking for organic food and are willing to pay more for it,” she says. Most shoppers who frequent Doherty’s supermarket are neighbors living and working in the area.
“With their strong ties to their communities and agility to quickly respond to consumer shifts in the marketplace, independents are well positioned to stay ahead of the consumer trend curve,” said Laura Strange, Vice President of Industry Relations, Communications and Marketing for National Grocers Association.
Online grocery shopping is slowly becoming a supplement to in-store purchases. About 3 in 10 independent shoppers anticipate an uptick in their online grocery shopping over the next five years. According to the report, in order to realize the potential of the online market, grocers should boost e-commerce investment by focusing on relevant target markets and keeping fees low and consistent.
The study also found that consumers want independent grocery chains to support healthy eating. 39% of those surveyed ranked using shelf tags with easily visible nutritional information as the top way a primary independent store can help them maintain a healthy diet. Furthermore, consumers recommended that primary stores should instruct them on how to cook certain foods.
To offset changes in consumer purchasing behavior, the NGA advises local grocers to avoid price increases on deli and bakery items, and running deals on seafood. Additionally, grocers can recommend healthier options within the category for consumers who have moved away from beef for health reasons. Grocers taking proactive such as these can go a long way as over half of the survey respondents say they want their local supermarket to show them what items are fresh and in season.
Findings from the NGA report also echo observations gleaned from the 2018 Harris Poll Reputation Quotient survey, which found that Americans value brands in their backyard that have become part of the community. Convenience goes a long way in fostering loyalty. Supermarkets scored high on the RQ survey. For the first time in the poll’s 19-year history, five grocery chains were featured among the top 10 companies on the list of 100 most visible companies identified and ranked by the U.S. public based on their reputation.