Ready for Some Good News?

By: David Fikes, Vice President, Consumer/Community Affairs and Communication, Food Marketing Institute

We can all use some good news and if you are a traditional food retailer, the 2018 edition of FMI’s U.S. Grocery Shopper Trends has some.

The first piece of good news is it looks like the dust kicked up by the new channels entering the market the past forty years is beginning to settle a bit. For years,Trends has been tracking primary store traffic and when we first started in 2003, the traditional supermarket out-stripped all other channels as the primary store of choice for 79 percent of shoppers. With the entry of new food retail players such as supercenters, club stores, dollar stores, specialty stores, and more recently, online, that number has been steadily eroding year by year for the past four decades. In 2007, 61 percent picked the traditional supermarket as their primary store and in 2016, a 49 percent showing meant supermarkets had dipped below the 50 percent mark for the first time. The good news is that for the past six years, the score for supermarkets appears to have stabilized around that 50 percent mark. While some may yearn for those 80 percent days, the fact that things are smoothing out is an indication that supermarkets have learned how to take a few plays out of the newcomer’s play books and compete with them on these new terms. 

Each of the new competitors have revised the rules of food retail in some way; some by cost, some by scale and online did it by style and delivery convenience, but traditional supermarkets have upped their adaptability game and are making the necessary adjustments at the pace required to plug the primary-store leak. Time will tell if the trend reverses or if the distinctions between these different channels become so blurry that it forces a channel vocabulary revision of a magnitude that it would render this traditional trend irrelevant. For instance, can we still consider it a traditional supermarket if the store offers online shopping and has specialty shops under its roof? Throughout the expansions to the food retail playing field, supermarkets have remained the most popular of the food retail channels, as measured in frequency of visits. It appears supermarkets have stopped the hemorrhaging, but to heal and bounce back, it now appears to be a matter of capitalizing on the popularity by continuing to adapt the benefit consumers have recognized in the other channels and make them part of the supermarket’s personalized offering. 

The other pieces of good news come in the crucial area of customer trust. According to this year’s Trends, 93 percent of consumers indicate they trust their store to ensure the food they sell is safe. And in other areas critical to customer loyalty, our data indicates that food stores are increasing their influence as a partner in their customer’s journey toward eating well. For several years now, we’ve been asking consumers, “when it comes to helping me stay healthy, which of these people or institutions would you say are on your side and which are working against you?” The answers to that question have remained relatively consistent for five years, but this year we saw some significant movement. In the “on my side” column, the top two answers remained My family (73 percent) and Doctors (69 percent). This year Farmerssaw a bump of 10 percentage points over their 2017 score, which moved them into the number three spot edging out My friend sat 58 percent. But the really good news is that both the categories of My primary store and Food stores in general, saw significant improvements in their 2018 scores. In recent years, the percentage rating of the My primary store answer has hovered in the mid-forties, but the 2018 rating at 55 percent was a ten-percentage point jump over the 2017 score. That is putting it within spitting distance of number four on the list My friends (58 percent) and number 5, Fitness/health clubs (57 percent). Likewise, Food stores in generalsaw an 8-percentage point bump over its 2017 score, moving it up a notch into the number seven slot. 

The fact that consumers identify their food store as a wellness advocate on par with their friends is a real credit to the work food retailers are doing to provide their customers with information, guidance and support, helping them shop well, so they may, also eat well. Likewise, in the context of eroding public trust in big entities such as whole industries, the fact that confidence in Food Stores in general improved is a testament to the quality of customer service that consumers are receiving throughout the food retail industry, regardless of the venue.  

And that is truly good news. 

Download U.S. Grocery Shopping Trends