3 consumer trends shaping grocery retail in 2023

Grocery lives in a world of retail unlike any other–there’s no getting away from the fact consumers need to buy the essentials, and those essentials can be found in their local supermarket. Grocery offers a wealth of opportunities to both improve the experience of shopping for everyday essentials, and to tempt shoppers to keep adding non-essentials to their baskets.

Inflation is at a 40-year high. And while consumers may be cutting back financially to weather the financial storm, they’re also swapping date night dinners at their favourite restaurant for premium meals to be enjoyed at home.

While the industry continues to plough through more unprecedented times, having an awareness of the big consumer trends means grocery brands can connect more deeply with their customers and demonstrate empathy during troubling times. Here are just a few key ways grocers can capitalise on customer experience to keep shoppers both engaged and satisfied.

The experience economy and in-store shopping

While in recent years retail has been pushing for speed and convenience in the delivery sector, we’re starting to see the return of in-person shopping. NielsenIQ data from the start of the year reports a 9.4% increase in in-store sales, and a 8.7% decrease in online as customers hunt out the best bargains and avoid delivery charges.

In-store shoppers provide grocers with an opportunity to deliver meaningful experiences which can lead to loyalty. And there’s evidence investment in immersive experiences leads to a return, with 77% of business leaders reporting positive ROI, according Zendesk’s CX Trends 2023 report.

As more shoppers try to stretch their pounds a little further, loyalty cards allow grocers to target shoppers with personalised rewards. Tesco reported its Clubcard penetration increased by +9.8ppts Y-o-Y in its half-year results late last year, extending rewards to 2m Clubcard customers.

Technologies such as scan-and-go apps to speed up check-out, augmented reality mapping to ease the shopping journey, or QR codes with inspirational recipes or information about product sourcing are also ways to improve the experience of pushing a trolley around a supermarket. Grocers could also consider redesigning spaces to create immersive playgrounds for foodies taking a leaf out of the book of luxury experts like Fortnum & Maso. If a complete redesign is off the cards, consider working with brand partners for live in-store cookery lessons and incorporating dining spaces to engage customers and increase dwell time.

And don’t forget about the increasingly eco-conscious shopper. Consider offering drop-offs for difficult to recycle plastic bags and films, or going one step further like Asda’s sustainability store in Leeds with refill stations for bulk purchases of items such as pasta, washing powder, and tea bags with an ambition to save one million pieces of plastic per year.

All these things can’t be experienced if you’re doing the weekly shop while sitting on your sofa at home.

Value proposition

Whether they’re shopping online or in-store, shoppers still want to feel like they are getting value for their money in an unstable economy, meaning the supermarkets are increasingly fighting against their rivals in a battle of the prices. Sainsbury’s recently increased the number of products in its Price Match campaign by a third; Iceland is attracting new customers with its £1 price freeze; and even high-end grocer Waitrose recently announced a 14% cut in its Essentials line.

With all this discount messaging hitting the customer, grocers need to be mindful of not devaluing their brand and using this as an opportunity to communicate with the customer in an empathetic way, like Aldi, with its budgeting advice to help customers through this difficult time.

One of the big recessionary trends is the tendency for shoppers to ‘trade down’ from big-name household brands like Fairy or Heinz to cheaper supermarket alternatives. This presents a huge opportunity for the grocers to develop and promote their own product lines. Just take a leaf out of the discounters’ books, the likes of Aldi and Lidl are constantly shaking up the market, by offering similar products to known brands, for a more affordable price.

Grocers need to truly understand their own perceptions of ‘value’ – be that BOGOF offers or knock-off caterpillars. At the end of the day, ensuring the appropriate tone and language when communicating with customers both in-store and online is vital.

Trendsetter

In tough economic times, even a brand’s most loyal customer may venture to a competitor to try out a cheaper alternative – especially when being bombarded with offers left, right and centre. One way to try and keep hold of those valued customers is by keeping up with the latest food and drink trends and leveraging those to connect with shoppers. From air fryers to no- and low-alcoholic drinks, sustainable eating to West African cuisine, there’s a raft of food trends grocers need to keep on top of to ensure they are serving their customers with what they want.

Healthy eating and wellness continues to dominate in a post-Covid world. Waitrose saw a 31% surge in demand for non-alcoholic beverages in the run up to Dry January, while plant-based diets are also increasingly popular tapping into healthy eating and sustainability goals. Meanwhile, sales of air fryers have exploded as the health-conscious trend meets ongoing concerns over energy costs – electronics retailer Currys reported a 500% surge in sales compared to last year. That’s a lot of new air fryers in kitchens up and down the country, with consumers in need of expert tips on how to make the most of them.

In addition, cuisines like West African and Filipino are starting to gain more recognition through new restaurant openings and TV shows throwing a spotlight on these world foods. Supermarkets are championing these flavours with meal kits and speciality ingredients such as Waitrose Cooks Ingredients where shoppers can unleash their inner MasterChef by easily whipping up a bowl of ramen or daal with deggi mirch oil.

With food increasingly taking centre stage in consumers’ lives, this is a huge opportunity for grocers to engage with shoppers by creating recipe cards, magazines, or blogs to share tips and tricks on the latest trends in the culinary world.