Description

This report provides comprehensive and current information and analysis of the US Grocery Retailing market including grocery retailing market size market size, anticipated market forecast, relevant market segmentation, and industry trends for the Grocery Retailing market in the US.

Current market landscape

After unprecedented sales growth in 2020 during the first year of the COVID-19 pandemic, retailers were challenged by sudden surges in grocery shopping caused by panic buying, shifts in consumer eating to include more in-home cooking, and the rapid adoption of ecommerce for grocery shopping. Consumers continue to evolve with the next normal and are becoming more comfortable shopping in-store for groceries, resulting in a rebound to in-store shopping frequency. Even as in-store remains the preferred channel, the increase in ecommerce persists at more sustainable levels, as omnichannel shopping becomes the norm for many shoppers.

Future market trends in US grocery retailing

COVID-19 continues to cause disruptions for retailers and consumers as new variants of the virus drive a continuation of pandemic behaviors, such as limiting time spent in stores and cooking more at home, fueling continued demand for groceries. Additionally, the ongoing pandemic has created new challenges for grocers. Global supply chain constraints at a time of peak consumer demand have led to widespread inflation, price hikes and inventory shortages – further impacting consumers’ shopping behaviors. Grocers continue to navigate COVID-19 safety protocols and labor shortages amid fluctuations in state and federal mandates, as they work to reinvent their business models to embrace continued growth, digital expansion both in-store and online, and reevaluate what the in-store experience looks like in the evolution of the next normal.

Read on to discover more about the consumer market, read our US Online Grocery Retailing Market Report 2021 report, or take a look at our other Food Retail research reports.

Quickly understand grocery retailing market share

  • The impact of COVID-19, inflation, supply chain constraints and other market factors on consumer behavior and the grocery market.
  • Where consumers are doing their shopping and what they look for in their primary grocer.
  • Consumers’ grocery shopping behaviors and in-store preferences.
  • The evolution of omnichannel shopping.
  • Consumer interest in in-store concepts and services.

Covered in this grocery retailing market report

Brands include: Walmart, Winn-Dixie, Hy-Vee, Sam’s Club, Kroger, Bed Bath and Beyond, PetSmart, Chewy, Fred Meyer, Giant, Albertson’s, H-E-B, Aldi, Target, Lifvs. Fresh Thyme Market, UNFI, Schnuk Markets, Hellmann’s, About Fresh, Amazon Fresh, Target Circle.

Expert analysis from a specialist in the grocery retailing market

This report, written by Brittany Steiger, a leading analyst in the Retail and eCommerce sector, delivers in-depth commentary and analysis on the food and grocery retail market to highlight current trends and add expert context to the numbers.

After two years, COVID-19 continues to have an impact on the grocery sector. The combined pressures of supply shortages and inflation drive up prices, prompting consumers to prioritize value. Pandemic behaviors give way to new norms, as omnichannel shopping becomes commonplace. Additionally, the strides made in technology enable grocers to reimagine the in-store experience, as digital tools create the store of the future.

Brittany Steiger, Senior Analyst, Retail and eCommerceBrittany Steiger
Senior Analyst, Retail and eCommerce

Table of Contents

  1. Overview

    • What you need to know
    • This Report looks at the following areas
    • Definition
    • Market context
    • COVID-19: US context
    • Economic and other assumptions
  2. Executive Summary

    • Top takeaways
    • Market overview
      • Figure 1: Total US sales and fan chart forecast of groceries, at current prices, 2016-26
      • Figure 2: Grocery retailing outlook, 2022-27
    • Opportunities and challenges
    • Rising costs and supply shortages challenge retailers and consumers
    • In-store and omnichannel technology deliver the store of the future
    • Automation solves operational challenges
    • Call to action on climate change and sustainability
    • Key consumer insights
    • eCommerce remains elevated, but the store is still the preferred grocery channel
    • Value concepts becoming increasingly important
    • Shoppers frustrated by long checkouts and out of stocks
  3. Market Size and Forecast

    • Demand for groceries remains high prompting sales growth on top of already high levels
      • Figure 3: Total US sales and fan chart forecast of groceries, at current prices, 2016-26
      • Figure 4: Multi-outlet sales and forecast of groceries, at current prices, 2016-26
  4. Segment Performance

    • Supermarkets trail other channels; category leaders are Walmart and Amazon
      • Figure 5: Multi-outlet sales of groceries, by segment, at current prices, 2016-26
    • Food and drink still the predominant grocery segment with room to grow in other areas
      • Figure 6: Multi-outlet sales of groceries, by category, at current prices, 2016-21
      • Figure 7: Supermarket sales of groceries, by category, at current prices, 2016-21
  5. Market Factors

    • Food prices surge as inflation accelerates to a 40-year high
      • Figure 8: 12-month percentage change, Consumer Price Index – All items versus food at home items, March 2021-February 2022
    • Supply chain disruptions and out of stocks prompt consumer frustrations
    • Labor shortages create challenges in the grocery sector
      • Figure 9: Unemployment and underemployment, 2007-22
    • Restaurant rebound on the horizon
      • Figure 10: Sales of food at home and away from home, 2010-21
    • Sustainability becomes increasingly important amid threat of climate change
    • Continued impact of COVID-19 on consumer behavior
  6. Competitive Strategies and Market Opportunities

    • Winn-Dixie delivers value as prices rise
      • Figure 11: Winn-Dixie, “Down Down” program
    • The opportunity: support shoppers during a time of uncertainty
    • Grocers invest in tech to elevate and add convenience to the in-store experience
      • Figure 12: Hy-Vee’s reimagined store design; Nourish + Bloom autonomous shopping
    • The opportunity: leverage in-store technology to deliver convenience to shoppers
    • Sam’s Club rolls out automated inventory-checking robots
      • Figure 13: Grocery Dive features Sam’s Club robotic inventory analysis equipment
    • The opportunity: leverage automated solutions to offset labor shortages and free up staff time to focus on customer service
    • Kroger expands general merchandise categories through partnership with Bed Bath & Beyond
      • Figure 14: Kroger + Bed Bath & Beyond partnership
    • The opportunity: carve out partnerships to expand across categories
    • Grocers do their part to combat food waste
      • Figure 15: Grocers and grocery delivery companies do their part to combat food waste
    • The opportunity: invest in AI or community partnerships to offset food waste
      • Figure 16: Kroger/Fred Meyer + Loop launch reusable packaging initiative
  7. The Grocery Consumer: Fast Facts

  8. Grocery Shopping Overview

    • Who shops for groceries
    • Nearly all adults shop for groceries, many share the responsibility
      • Figure 17: Grocery shopping responsibility, by gender and age, 2022
    • How often they shop
    • Shopping frequency is increasing as consumers shop in new ways and across multiple channels
      • Figure 18: Shopping frequency, by generation, 2022
    • Parents are frequent grocery shoppers
      • Figure 19: Select shopping frequency, parental status by gender, 2022
      • Figure 20: Walmart appeals to parents with holiday baking kits
    • Shopping method
    • In-store rebounds, online and multichannel shopping remains elevated
      • Figure 21: Shopping methods, 2022
      • Figure 22: Select shopping methods, yearly comparison, 2019-22
    • Millennials are driving multichannel shopping; older consumers stick to in-store
      • Figure 23: Shopping method, by generation, 2022
    • Consumers shop in-store for impulse trips; online for stock up trips
      • Figure 24: Preferred shopping method by trip type, 2022
      • Figure 25: Preferred shopping method by trip type, by generation, 2022
      • Figure 26: Giant Foods eliminates pickup fees
  9. Ongoing Impact of COVID-19

    • Consumers continue pandemic behavior patterns
      • Figure 27: Impact of COVID-19 on grocery shopping, 2022
    • Older consumers concerned about safety, younger consumers watch their spending
      • Figure 28: Impact of COVID-19 on grocery shopping, by generation, 2022
      • Figure 29: Albertson’s Just for U program, 2021
    • Multicultural consumers embrace cooking at home
      • Figure 30: Selected impact of COVID-19 on grocery shopping, by race and Hispanic origin, 2022
      • Figure 31: H-E-B Virtual Cooking Classes: Hispanic Heritage month with Johnny Hernandez
  10. Shopping by Category

    • Consumers still shop in-store for most categories, but online shopping habits hold
      • Figure 32: Shopping for major categories – Online versus in-store, 2022
    • Gen Zs and Millennials are shopping for more prepared foods
      • Figure 33: Shopping for major categories – Fresh prepared meals, by generation, 2022
      • Figure 34: Kroger partnership with ghost kitchen company Kitchen United
  11. Retailers Shopped In-store

    • Supermarkets and Walmart remain top preferred retail outlets for groceries
      • Figure 35: Retailers shopped in-store, 2022
      • Figure 36: Aldi’s “Charcuterie Board of Directors”
    • Multicultural consumers diversify across different retailers
      • Figure 37: Retailers shopped in-store, by race and Hispanic origin, 2022
      • Figure 38: Kroger promotes Black-owned brands
  12. Reasons for Preferred Grocery Retailer

    • Proximity and value are primary drivers for consumers when choosing their retailer
      • Figure 39: Reasons for preferred physical grocery retailer, by generation, 2022
    • Income level impacts grocery shopping approach; inflation will have an impact for all
      • Figure 40: Reasons for preferred physical grocery retailer, by household income, 2022
      • Figure 41: Euronews Next highlights Lifvs’ unmanned rural grocery stores
  13. In-store Shopping Behaviors

    • Grocery shoppers stick to their routines
      • Figure 42: In-store shopping behaviors, by generation, 2022
      • Figure 43: Walmart and NBC’s Today Show partnership, “Today Table”
      • Figure 44: Fresh Thyme Markets “smart” shelf tags create differentiation
  14. Attitudes toward In-store Grocery Shopping

    • The basic elements
    • Freshness remains the top priority for in-store shoppers
      • Figure 45: Attitudes toward grocery shopping – Basic elements, by generation, 2022
      • Figure 46: Walmart announces partnership with vertical farming company Plenty
    • Consumers enjoy grocery shopping; but grocery store burnout is increasing
    • Product discovery and meal inspiration
    • Quality perception of store brands
      • Figure 47: Attitudes toward grocery shopping – Product discovery and meal inspiration, by race and Hispanic origin, 2022
      • Figure 48: UNFI revamps private label brand Wild Harvest
    • Grocers as inspiration for recipes and healthy eating
      • Figure 49: Giant Food in-store dietitian; Schnuk Markets’ “Good For You” program
    • Growing interest in international cuisine
    • Conscious consumers interested in sustainability and causes
    • Combatting climate change and food waste
      • Figure 50: Attitudes toward grocery shopping – Environmental factors, by generation, 2022
      • Figure 51: Hellmann’s Mayonnaise tackles food waste
    • Localism and activism
      • Figure 52: Attitudes toward grocery shopping – Localism and activism, by generation, 2022
      • Figure 53: Stop & Shop partners with About Fresh
  15. Interest in In-store Experiences

    • Freshness and product discovery remain at the top of the list
      • Figure 54: Albertsons partners with Picadeli to pilot AI-equipped salad bars
      • Figure 55: Interest in in-store experiences, by generation, 2022
      • Figure 56: Amazon Fresh highlights cashierless technology
  16. Interest in Shopping App Features

    • Shoppers interested in features that add value and convenience
      • Figure 57: Interest in shopping app features, by generation, 2022
      • Figure 58: Sam’s Club promotes Scan & Go checkout during Super Bowl
  17. Consumer Frustrations with Grocery Shopping

    • Long checkout lines and time spent frustrates consumers
      • Figure 59: Consumer frustrations with grocery shopping, by generation, 2022
    • Out of stocks are a growing concern
  18. Appendix – Data Sources and Abbreviations

    • Data sources
    • Sales data
    • Forecast
    • Consumer survey data
    • Consumer qualitative research
    • Abbreviations and terms
    • Abbreviations
    • Terms
  19. Appendix – The Market

    • Inflation-adjusted forecasts
      • Figure 60: Multi-outlet sales and forecast of groceries, at inflation-adjusted prices, 2016-26
      • Figure 61: Supermarket sales and forecast of groceries, at inflation-adjusted prices, 2016-26
      • Figure 62: Sales and forecast of groceries through other multi-outlet channels, at inflation-adjusted prices, 2016-26
    • Retail channels by category sales
      • Figure 63: Supermarket sales of groceries, by category, at current prices, 2016-21
      • Figure 64: Sales of groceries through other multi-outlet channels, by category, at current prices, 2016-21
      • Figure 65: Multi-outlet sales of food and drink, by retail channel, at current prices, 2016-21
      • Figure 66: Multi-outlet sales of general merchandise, by retail channel, at current prices, 2016-21
      • Figure 67: Multi-outlet sales of HBC, by retail channel, at current prices, 2016-21

About the report

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