Why the Middle Ground Is Fertile for Grocery Growth
Shoppers continue to divide their grocery spend among traditional supermarkets, mass merchandisers, discount/dollar stores and convenience stores, with buying habits often varying by location.
Newly published research from foot traffic analytics firm Placer.ai highlights opportunities for traditional grocers in certain regions of the United States with splintered marketplaces. According to the white paper, Unlocking Potential in Underserved Grocery Markets, even grocery chains that have a limited presence in areas where consumers shop regularly at superstores and discount stores can grow their share of sales.
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These regional and national grocery chains should focus on what they do well to attract more consumers, the white paper authors point out. “With their primary focus on stocking a wide variety of fresh foods, these chains serve a critical function in offering consumers access to healthy options,” they wrote.
Supermarkets in or near underserved areas can use location analytics to identify communities with grocery gaps and learn about local food shopping preferences to meet needs and demands. Placer.ai’s white paper called out certain parts of the country that are ripe for such expansion. The nation’s midsection is one example, where residents in many central states are less likely to go to a grocery chain to stock up on food and essentials. In North Dakota, for instance, trips to grocery stores comprised only 11.7% of visits to food retailers during a measured period.
The needle can be moved. Placer.ai’s foot traffic data shows that some states with lower grocery visits experienced year-over-year growth, suggesting “significant untapped potential for grocery stores and a market that is hungry for more.” Recent population migration, including shifts away from some urban centers to states like South Carolina, represents another avenue for expansion.
Placer.ai’s full white paper is available online.
