Consumers Look Forward to Holidays; More Opt for Prepared Foods at Grocery
Despite ongoing worries about higher food prices, shoppers feel more able to manage their grocery budgets as the holidays approach, according to FMI —The Food Industry Association’s annual “U.S. Grocery Shopper Trends: Holiday Season” report. Further supporting those findings is FMI’s recently released ninth-annual “Power of Foodservice at Retail” report, according to which retail foodservice purchases continue to play a pivotal role in shoppers’ meal preparation.
Consumers noted excitement and enthusiasm regarding the holidays even as they cited concerns about rising prices: Seventy-three percent of those celebrating holidays said that they’re very or somewhat excited about the festive season. Moreover, with 85% of shoppers reporting at least some control over their grocery expenses, respondents are feeling more ready to dive into holiday shopping this year.
“While consumers remain understandably concerned about the cost of food impacting their holiday meal preparations, we continue to see remarkable resilience and adaptability among shoppers,” said Leslie G. Sarasin, president and CEO of Arlington, Va.-based FMI. “Whether it be shopping deals and sales or choosing store brands, Americans are stocking up and preparing for the holidays early and eagerly.”
The good news for shoppers, as economist Dr. Richard Volpe pointed out in an FMI presentation on the reports, is “we are on track for below-average food price inflation in 2024 relative to the historical norm.” He went on to note that while “meat and egg prices are still challenging … fruit and vegetable prices are down [and] cereals and bakery products are looking good.”
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A “hybrid” approach to meal preparation – integrating such retail foodservice items as deli-prepared foods into weekly grocery shopping – has also grown more common, with shoppers reporting they prepared and ate more dinners at home in 2024 than at any time since 2020. Consumers are aware that semi- or fully prepared items from grocery stores are valuable, budget-friendly options to supplement or even replace a home-cooked meal.
In 2024, according to NIQ, sales of retail foodservice prepared foods rose by 1.4% to around $50.9 billion. This trend is anticipated to continue into the holiday season, with 13% of shoppers saying that they’ll buy more prepared foods from food retailers versus last year.
Among those who observe the holidays, nearly 60% said that spending harmonious, quality time with loved ones is the most important ingredient for a successful holiday, followed by 32% who cited creating a great homemade feast. To attain these goals, 40% of consumers are prepping for the winter holidays more than a month in advance.
[Read more: OP-ED: Shoppers Find Value at the Grocery Store Amid Challenging Times]
FMI’s “U.S. Grocery Shopper Trends: Holiday Season” additionally found:
- Weekly grocery spending has stayed consistent this year, with an average of $158 per week.
- 39% of holiday shoppers are extremely or very concerned about potential out-of-stocks for major ingredients; for families with children, this concern rises to 44%.
- 46% of shoppers said they would make a familiar alternative dish if their preferred ingredients were unavailable, and 30% said they were willing to try a new recipe.
“These actions really underscore a lot of budget-conscious approaches with a clear focus on maximizing every dollar, while still preserving the quality of the holiday celebrations that people have,” observed Steve Markenson, FMI’s VP research and insights, during the presentation.
The trade organization’s “Power of Foodservice at Retail 2024” survey also revealed:
- Total deli sales reached about $450.9 billion, reflecting a growth rate of 1.4% in dollars and 1.2% in units over the past 52 weeks, driven by shoppers’ desire for convenience and affordability.
- 70.7% of households buy retail foodservice products regularly, with an average purchase frequency of 9.5 times annually and an average transaction size of $8.30.
- The frequency of shoppers cooking dinner at home at least seven times per week rose slightly this year from 21% to 23%.
- 63% of shoppers said that they try to eat nutritious options at least some of the time when buying deli-prepared foods from grocery stores.
- 59% of shoppers said that they want to be able to purchase a combination of prepared foods – main course, sides and dessert – for a set, discounted price.
“This growth speaks to the rising consumer demand for fresh ready-to-eat options that save time and effort,” noted Rick Stein, VP of fresh foods at FMI, during the presentation. “Within this segment, certain categories are driving momentum, such as pizza and fully cooked meats, both of which have shown robust year-over-year growth.”
Regarding this time of year, Stein said: “Particularly as we head into the holiday season, when convenience is key, consumer behavior is a significant driver behind the growth of retail prepared foods as evolving work patterns, health interests and the need for convenience shape purchasing habits.”
