The latest Feedback Group research explores the many strategies shoppers are using to respond to food price inflation and reveals their perceptions of supermarket profitability.
LAKE SUCCESS, N.Y., June 7, 2022 /PRNewswire-PRWeb/ -- The Feedback Group, a leader in providing actionable stakeholder feedback, today released findings from new national research conducted with more than 1,200 grocery shoppers about their response to food price inflation and their perception of supermarket profitability.
Shoppers Employ Various Strategies to Cope with Food Price Inflation
With food and beverage prices significantly higher in 2022, The Feedback Group asked grocery shoppers what they have done over the past few months to deal with food price inflation. Shoppers employ a wide range of strategies to cope, foremost being purchasing more food and groceries at stores with lower prices (46% have used this strategy), eating more often at home instead of restaurants (also 46%), and buying more items on sale (43%). Other common strategies include buying more store brands instead of national brands (38%), purchasing more bulk-pack items to lower the price per serving/unit (25%), buying fewer last-minute or impulse items (25%), substituting similar, less expensive foods (24%), and using a store's weekly sales flyer to plan their shopping list (23%). Additionally, some shoppers compare prices at multiple stores before buying an item (18%), purchase food for home that is less healthful but also less expensive (15%) and buy fewer organic items and products to cut costs (12%).
Brian Numainville, a principal with The Feedback Group, commented, "Grocery shoppers are dealing with food price inflation in a number of significant ways, with nearly half moving their purchases for food and groceries to stores with lower prices and eating more at home instead of restaurants, as well as buying more items on sale. Further, nearly four out of ten grocery shoppers indicate they have been buying more store brands instead of national brands, and our research shows that 75% of shoppers agree that the prices of private or store brands were a lot less expensive than national brands."
Doug Madenberg, Chief Listening Officer with The Feedback Group, added, "Our study shows that food inflation is having a tremendous impact on supermarket shopping behavior. More than 90% of shoppers have employed at least one money-saving strategy to deal with the impact. It's critical that grocers merchandise and communicate in ways that show their customers they are part of the solution."
Shoppers Looking for Lower Prices in Meat, Dairy and Produce
Shoppers were asked what one item they would like supermarkets to lower the price on. The category with the largest number of responses, meat, had more than double the number of responses of the next highest category, dairy items (with milk mentioned most). Produce had the third highest number of responses (about evenly split between fruit and vegetables).
Shoppers' Perception of Supermarket Profitability Is Considerably Higher Than Reality
Grocery shoppers were asked, from the money spent at their primary store, how much they think is left for profit, after the store pays all expenses and taxes. On average, shoppers indicated they believe their primary store has a net profit of 33%. According to FMI – The Food Industry Association, the average net profit for a supermarket has been close to 1% historically (and as high as 3% in 2020).
"Clearly, grocery shoppers believe that the stores they shop are far more profitable than they actually are," Madenberg stated. "This inflated view of profits certainly leads some shoppers to think that food stores simply aren't doing enough to keep prices down." Madenberg continued, "I think most grocers had a hunch about this misperception, but the actual 33% net profit figure is extremely telling." Shoppers' off base perceptions likely feed into their middling ratings of supermarket price competitiveness (average of 3.95 on a five-point scale) and only slightly higher marks on value for the money spent (4.18 on average).
More findings from The Feedback Group's national consumer research will be released in the coming weeks.
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About The Feedback Group
The Feedback Group offers a broad spectrum of research, consumer insight, and consulting services. As a 360-degree listening partner, The Feedback Group provides services include employee experience assessments, customer satisfaction programs, and consumer perception studies, as well as national, regional and local shopper studies. For more information, visit feedbackgroup.com and connect on Twitter @TheFeedbackGrp.
Media Contact
Brian Numainville, The Feedback Group, 1 516-829-4200, [email protected]
SOURCE The Feedback Group
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