What Grocery Shoppers Want: Convenience and Fresh Food
According to “A Fresh (Food) Take on Grocery Convenience,” its sixth annual assessment of the state of fresh food, the audit, consulting, tax and advisory services firm Deloitte had found that consumers desire simplicity when when purchasing food: 52% of respondents said that they value convenience now more than they did in the past. Grocers also acknowledge the value of easier options, with more than eight in 10 (84%) agreeing that successfully competing on convenience is key to boosting unit sales volume.
Additional takeaways from the report include the following:
- Grocers surveyed are concerned about competition for convenience-seeking consumers from online grocery stores (56%) and third-party shopping apps (53%). However, consumer survey data and industry trends indicate that grocers should be more worried about other traditional grocers, restaurants and dollar stores.
- More than half (53%) of consumers surveyed said that deciding “what’s for dinner” is among their major pain points, and 44% would regularly buy from a grocery store that could assist them with meal planning.
- Eighty percent of grocers surveyed (up from just 40% in 2023) are optimistic about generative AI’s potential financial contribution, citing its use as a consumer assistant as their top choice for a first highly successful use case or “killer app.”
Stressors for grocers include emerging forms of competition, rising shopper expectations, and tightening consumer wallets. Despite these challenges, such traditional grocery strengths as fresh food and convenience play an increasingly important role in many consumers’ purchase decisions. In its report, Deloitte looked at how grocers could win a greater share of stomach by bringing “fresh convenience” to consumers as they plan their meals, decide where to shop and choose their food.
With fresh food and convenience typically top of mind for consumers, the need for easy options seems to be shaping how shoppers decide what to buy. Grocers are recognizing the importance of fresh food, with more than half (52%) of grocery executives expecting fresh to be their most strategically important department over the next one to three years. The produce, deli and meat departments are leading this charge.
Meanwhile, nine in 10 U.S. consumers said that fresh food makes them happy, and two-thirds (66%) said that they would pay a premium for it. On average, shoppers said that they would pay 22% more for fresh over such alternatives as canned, frozen or other alternatives.
However, when they’re deciding between either fresh or convenient food, convenience often wins. Eighty-two percent of shoppers said that convenience inspires their fresh food decisions. Further, two-thirds (67%) of consumers said that on busy days, they buy more convenient food items, even if they aren’t healthy or fresh. The consumer view noted above that convenience is now more important to them than in the past was particularly prevalent among Millennials (57%) and Gen Z (61%), indicating a lasting trend. In response to this, 85% of grocers said that they are making significant investments to increase convenience.
“Grocers are navigating a new wave of change, including price-sensitive consumers, food away from home eating into ‘share of stomach,’ and stress on the profitability of the grocery business model from grocery delivery last-mile logistics,” noted Daniel Edsall, grocer leader and principal at New York-based Deloitte Consulting LLP. “Yet there continues to be great opportunity around grocers’ strength with fresh food. Shoppers love fresh food and crave convenience, [so] finding new ways to provide consumers with ‘fresh convenience,’ by offering fresh choices in approachable ways, could help drive more sales.”
Consumers are looking for convenience not just in their food choices, but also in how and where they shop. As consumer preferences waver between convenient offerings and fresh food, there’s growing competition among innovative shopping formats. To compete, grocers should adopt strategies that meet consumer demands, both in the products they carry and in the overall shopping experience. In their quest for convenience, consumers surveyed said that they’re more likely to continue shopping at their local grocer (47%) or otherwise go to a restaurant (25%). Other rivals include dollar stores selling fresh food, which the survey data indicates may be underappreciated by grocers as a competitor.
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According to Deloitte, the biggest opportunity for boosting customer-perceived convenience in-store is at the point of sale. Consumers’ top priority for in-store convenience is faster checkouts (73%), followed by more convenient store layouts (59%) and easier returns (51%).
A strong opportunity for grocers is to help consumers plan meals and make shopping lists. GenAI may offer a solution to enable grocers to capitalize on the meal-planning trend. Younger consumers, including Gen Z (66%) and Millennials (60%), are particularly likely to consider deciding what to eat for dinner a primary pain point, while 62% of households with children also have problems planning evening meals. Fifty-eight percent of Gen Z and 55% of Millennials said that they would regularly buy from a grocery store that could help them with meal planning, and 44% of shoppers overall agree.
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Helping consumers plan meals could be a job for GenAI, which grocers are considerably more optimistic about, as noted above. Two-thirds (65%) of grocery executives said that their companies are increasing investments in the technology, and 73% said that their companies will have a major application in place within the next six months.
“Despite their growing desire for quick and easy choices, consumers still show significant preference for their neighborhood grocery stores,” observed Adam Almond, principal, retail and consumer products at Deloitte Consulting LLP. “Grocers can capitalize on, and look to enhance, that loyalty through innovative solutions that pair fresh food with more convenience. Investing in the pivotal moments throughout the shopping process can help ripen grocers’ chances for creating an industry advantage that shoppers will remember long after their carts are full.”
“A Fresh (Food) Take on Grocery Convenience” is based on a survey of 100 U.S.-based grocery retail executives from organizations with at least $1 billion in annual revenue, and 2,000 U.S. consumers, employing an approach designed to approximate U.S. census demographics. The surveys took place in May and June 2024.
