The experience of living through the pandemic forced consumers to rethink how they shop and eat, and what and where they buy. Grocers rose heroically to the challenge—adapting their businesses quickly as consumers switched their preferences and behaviors.
Now, as we emerge, the question turns to what happens next. Which of the new consumer priorities are here to stay? Which traditional behaviors might be set for a return? And how can grocers deliver the products, services and experiences consumers value most?
Findings from our research showed that the pandemic-fueled increase in online shopping shows little sign of being reversed. However, store shopping appears to be set for a strong return too, and consumers are recognizing the value of a mixed channel approach.
We also found that despite a greater affinity for local shopping and a focus on sustainability and responsibility that we have seen in the last year, many of the traditional consumer priorities (such as convenience and price) are as important as they ever were.
More than 50% of grocery consumers say they’re planning to use both stores and online shopping in the future.
Four ways grocers can turn up the dial on retail experience
To respond, retailers need to understand what their consumers value most and decide which of these priorities to focus on. Here are four ways retailers can stake out a clearer competitive differentiation in the post-pandemic grocery market.
Convenience leaders make their shopping experiences as simple, speedy, and painless as possible. They’re also operationally agile and technologically mature—adapting their offering as customer needs change and using digital technology to differentiate their shopping experiences.
Helpful and convenient technology may encourage consumers to choose one grocer over another:
of consumers say pop-up mobile notifications on product offers in store could entice them to shop with a retailer.
say interactive store technology could make them choose one retailer over another.
say they’d like to share online shopping lists with family and friends so they can all add items to the weekly shop.
Where should convenience leaders focus?
Carefully plan store networks, simplify online and offline shopping, and use AI and data analytics to personalize shopping experiences.
Inspiration leaders take on a more active role in connecting consumers with the kind of food they love—even if it’s something they haven’t tried before. They also look to freshen up both store and digital experiences to excite and inspire food lovers and make them want to spend their time with the brand.
Where should inspiration leaders focus?
Educate consumers on cooking methods and new products, work with small specialist brands, and introduce experiences to take products beyond the shelf.
One outcome of the pandemic was reconnecting people with their local communities. Community leaders understand their stores can serve a higher purpose beyond the retail transaction. They embed the idea of “local” deeply into the business, showcasing local producers and products, while building new kinds of communities among their customers.
Shoppers want to shop local and grocers have the opportunity to build their own communities:
of in-store shoppers now want to know that their grocery store supports and contributes to the local community.
of consumers say they’d participate in a grocer’s loyalty scheme if there was a greater focus on local products and offerings.
Where should community leaders focus?
Expand stores to become hubs for the community, give store managers autonomy to source local products, include local consumers in decision making.
04 Responsibility & sustainability
More and more of today’s grocery shoppers are focused on sustainability—three-quarters said they’d switch their spending to a retailer who better understood how important sustainability is to them. Responsible leaders know that the vast majority of consumers want their help in making a difference to the health and wellbeing of the planet and the people who live on it.
Where should responsible leaders focus?
Offer sustainable ranges and product refills, shift stores to green energy sources, find creative ways for consumers to make more sustainable choices.
Time for grocers to serve up something different
As consumers emerge from the pandemic with revised priorities, there is a need for clear differentiation. This is vital in an industry which has products, stores and experiences that are almost indistinguishable.
But there’s a limited window of opportunity to get it right. As the dust from the pandemic disruption settles, consumer habits will coalesce around new norms.
The imperative for grocers is to move quickly to understand and guide this process, stake out a clearly differentiated position, and use it to lead in their markets over the next decade. Read our new report.