How COVID-19 Changed the Way Americans Grocery Shop
by Ray Hartjen, guest contributor
The novel coronavirus/COVID-19 pandemic has changed so much of our world in 2020, and while we hope our routine activities return to normal soon, many aspects of our daily lives can be expected to fall into a “new normal.” At the head of that list for many Americans is how we shop for groceries.
In March, almost immediately, grocery shopper behavior changed tremendously, and several trends have emerged that look to become the new normal for well beyond the short-term. Grocery stores were forced to adapt and do the best they could in late spring, and those rapid prototypes and trials have resulted in a functional test-and-learn process that guides their plans for meeting today’s new grocery shoppers on the shoppers’ own terms.
Below are four ways grocery shopper behavior has changed and driven changes in the grocery segment.
Shoppers make fewer grocery visits
Before the concept of social distancing swept the nation, American grocery shoppers went to the store when they needed food. Now, they organize their grocery shopping missions to buy in quantities that limit their number of trips to the store, and, in theory, limit their exposure risk to the novel coronavirus.
According to a McKinsey & Company study, prior to the pandemic 19 percent of grocery shoppers visited the store three or more times a week. Post-pandemic, that number is almost halved, down to just 10 percent. Since the pandemic struck, 72 percent of American grocery shoppers visit the store once a week or fewer, compared to 55 percent prior to the pandemic.
Americans visit grocery stores less often, and when they do visit, they are shopping much differently.
Sales surge in frozen foods and house brands
According to the American Frozen Food Institute, frozen food sales for the month of March, as measured year-over-year, increased 94 percent. That’s the reason the frozen food aisle was so barren early in the pandemic!
It has slowed down since, but the growth is still significant. In August, frozen food sales were up over 17 percent versus the same time period a year previously. Americans are stocking their freezers, making the freezer the new pantry, and affording easy, more convenient ways to prepare meals at home rather than dining out as an alternative to the grind of home cooking.
Both at the freezer and in other areas of the store, shoppers are also shifting their purchase dollars to more store and house brands. In a July report, the Food Industry Association reported that three out of 10 shoppers stated they were buying more store bands than they were prior to the pandemic, and it’s a trend that’s not likely to reverse very quickly.
Once in the store, shoppers are shopping differently, and stores are changing to accommodate their needs and values.
Stores change layouts in response
In the midst of this 100-year pandemic, shoppers shared they want fewer shoppers and less congestion in stores, with higher cleaning and disinfection standards in place.
In response, many stores tested wider aisles to minimize the perception of being overcrowded. Others, like Publix, experimented with one-direction aisles, much to the disdain of shoppers – Publix recently announced stores were eliminating the one-way aisles, but continuing to provide social distancing reminders through in-store signage, floor markers at queueing areas and public address announcements.
End caps have also changed as a result of shoppers’ new behaviors. Formerly, those high-profile displays at the ends of aisles were home to new product introductions and special product promotions. Specialty items and free samples are now a thing of the past. Now, many end caps have been transformed to housing large-quantity or bulk SKUs.
Lastly, at the end of the shopper journey, checkouts are changing, with dramatic changes perhaps just over the horizon. Shoppers are keen to eliminate personal contact and want more contactless payment options. In response, Walmart is piloting a new store checkout concept in Fayetteville, Arkansas, featuring 34 registers in a plaza-like setting.
Expect grocers to use in-store retail analytics to test, measure and learn which new concepts get embraced by shoppers. Dwell zone analysis and shopper flow analysis will prove critical in developing data-driven, insights-backed store designs. Additionally, at the same time, grocers will be doing the same for their online stores.
Online grocery shopping comes into its own
For years, the better part of a decade, online grocery shopping has seen steady, but slow growth. In fact, in 2019, 81 percent of respondents to a Gallup survey reported they never shopped online for groceries. As a result, sales were growing slowly, and in August of 2019, online grocery racked up $1.2 billion at checkout.
In June of 2020, online grocery accounted for $7.2 billion in sales that month alone!
Grocers are having to respond and adapt to online ordering on the fly. Order fulfillment is straining labor and various infrastructures to the breaking point. Physical stores are having to redesign order pickup facilities, both in-store and at curbside. Some grocers, like Whole Foods, are opening new “dark” stores to fulfill online delivery orders only and better meet the rising consumer demand – and expectation – for grocery delivery services.
Consumers vote with their purchases, and shoppers are certainly leading the grocery industry into a new era. It will be important for grocers to quickly ideate and deploy test-and-learn strategies to discover the changing value-driven behaviors of grocery shoppers. And once data insights have been developed, over time and at scale, it will be important to immediately act and engage with shoppers in the new normal.
About the writer: Ray Hartjen is a marketing and corporate communications consultant with a wealth of experience in the retail, technology, life sciences, healthcare technology and consumer electronics industries. You can connect with Ray via both Twitter and LinkedIn.