1. Food-at-home demand is still going strong.
While some momentum has swung back toward restaurants, as consumers felt safer returning to public activities, many shoppers have retained their preference for eating at home due to habits generated during the pandemic, hybrid work environments and high menu pricing at restaurants. Grocery industry executives have continued to remark about the ongoing strength of food-at-home, and their sales growth has attested to the trend, even after the companies cycled exploding sales from 2020.
2. Supermarket foodservice rebounds.
COVID-19 forced grocers to shut down much of their self-serve and other prepared food operations and shift to packaged grab-and-go fare. With pandemic restrictions now largely removed, foodservice at the supermarket is back on the upswing. FMI-The Food Industry Association’s latest “Power of Foodservice” report cited
3. Perimeter back in the spotlight.
The resurgence of foodservice is part of an overall comeback by the fresh departments—produce, meat/seafood, deli, bakery and floral. During the thick of the pandemic, supermarkets were compelled to shift some of their focus away from the main money-making store areas to the center store grocery sections as they battled supply shortages.
4. Return of shopping at stores.
The rebound of foodservice and perimeter departments reflect an even larger trend: Grocery customers are back to shopping regularly at brick-and-mortar stores in the wake of the pandemic. This year, food retailers of all stripes have reported upticks in store traffic, and grocers have gotten back on track with store opening and upgrade programs.
5. E-commerce sales growth levels off.
With many food shoppers going back to stores, U.S. online grocery sales growth has moderated following the breakneck pace triggered by the pandemic, which pushed consumers away from risky in-person shopping and toward safer delivery and pickup services.
6. Big third-party grocery delivery players thrive.
Instacart, Shipt, DoorDash and Uber Eats (the latter two coming over from the restaurant sector) have continued to grow market share and enter new retail sectors. More recently, these companies have bolstered their technology and expanded their services and solutions for grocers
7. Rapid delivery players recede.
The proliferation of online-only grocers offering ultra-fast delivery (10 to 15 minutes)
8. Inflation, inflation and inflation.
High food prices probably was the lead story of 2022. Signs at the end of 2021 had pointed to elevated inflation for the new year and, sure enough, that’s what the industry got.
9. Private brands come to the fore.
Private-label market share increased in 2022 as high inflation steered grocery shoppers to products offering greater value. Grocery retailers responded by expanding their own-brand product lineups and stepping up store-brand promotions. Private-label offerings also have benefitted from greater exposure on retailers’ digital properties.
10. Retail media takes off.
Grocers ranging from small operators to major chains are getting into retail media in a bigger way, investing in technology to build digital media networks
