The state of grocery in North America
The COVID-19 pandemic left no industry untouched. Grocers in North America, along with those in other regions of the world, served as essential businesses and critical players in ensuring food supply during a time of great uncertainty. Customer behaviors shifted dramatically and rapidly during the pandemic, forcing grocers to adapt in kind. To prepare for what lies ahead, North American grocers must understand the new industry baseline, the nuances of key consumer shifts observed over the past year, and the behaviors and preferences that will endure once the pandemic abates. Our research suggests the next normal will be shaped by five factors in 2021 and beyond.
Grocers gained significant “share of stomach” during the pandemic as consumers across North America shifted to living, working, and learning at home. In an industry that has traditionally seen growth of 1 to 2 percent a year, North American grocery grew by approximately 12 percent in 2020, offsetting significant reductions in food away from home. 1 1. Kantar Retail IQ database.
The initial disruption of March and April 2020, marked by initial lockdowns and closures of all nonessential businesses, saw consumers choosing to visit grocers outside their traditional primary destinations. This trend, influenced primarily by proximity, store cleanliness, health, safety, and in-stock products, was a notable deviation from historical purchase drivers such as price, service, and in-store experience.
