A new survey of 1,000 U.S. adults, prepared by Inmar Intelligence, shows that 89 percent of shoppers have noticed an increase in grocery prices and everyday household items that they regularly purchase. Due to this price jump, 68% have traveled to another store to buy these items.
According to recent figures from The Consumer Price Index, ‘all items’ have increased 4.2 percent over the last 12 months – the largest 12-month increase since September 2008. Additionally, the food index increased by 0.4 percent in April for both home-cooked meals and dining out.
Today’s consumers are eager to get out of the house for their shopping, whether this is due to the increase in vaccinations or lessening of business restrictions, but they are still searching for value.
The data-driven, technology-enabled services company said while half (51 percent) of shoppers understand these are challenging times and rising prices reflect challenges faced, 41 percent believe that brands and retailers should find solutions to prevent rising prices for consumers. If not, they’ll have no problem switching stores to save money.
“The rising cost of groceries in the U.S. has certainly not gone unnoticed by today’s consumers,” said Spencer Baird, EVP and President of Inmar Intelligence’s MarTech division. “Shoppers are returning to physical stores and restaurants – but at the same time, still recovering from a global pandemic and expect to get value from their shopping experiences. The survey findings show just how quickly a consumer will change shopping habits in the name of cost savings. This should be a wake-up call for retailers, who must work to provide a seamless omnichannel experience with personalized promotions and coupons, to maintain and strengthen that customer relationship.”
Store brand products have also become a staple in consumer’s shopping carts, said Inmar Intelligence. Eighty-six percent of shoppers purchase these store brand products to save money.
Beyond this, shoppers eagerly join loyalty programs and consider joining wholesale discount clubs to get the best deal out there. Fifty-two percent of shoppers have joined more than one loyalty program offered by grocery stores due to rising prices, and 52 percent of shoppers are considering joining a wholesale discount club to save money on purchases.
Jayson Lusk, head of the agricultural economics department at Purdue University, said to Marketplace that food prices disproportionately affect lower-income households.
“Food prices, if you’re a relatively high-income household, is probably not that big a deal to you in the grand scheme of your household expenses. But it is a big deal to lower-income households,” Lusk said. “So I think that’s one kind of consequence that kind of causes inequitable outcomes across the supply chain.”
Consumer Food Price Index in Detail
The food index increased 0.4 percent in April. The index for food at home also rose 0.4 percent over the month as all six major grocery store food group indexes increased.
The index for fruits and vegetables rose 0.8 percent in April as the index for fresh fruits increased 1.5 percent. The index for dairy and related products rose 0.6 percent, and the index for meats, poultry, fish, and eggs rose 0.5 percent over the month.
The index for cereals and bakery products increased 0.4 percent, and the index for nonalcoholic beverages rose 0.3 percent in April.
The index for other food at home rose 0.1 percent over the month.
The food away from home index continued to rise, increasing 0.3 percent in April. In addition, the index for limited-service meals rose 0.5 percent, while the index for full-service meals increased 0.2 percent in April; both increases were the same as in March.
The food at home index increased 1.2 percent over the past 12 months. All six major grocery store food group indexes increased over the period.
In grocery prices, the most significant increase was the fruits and vegetable index, which rose 3.3 percent. However, several groups posted increases of less than 1 percent, including dairy and related products (0.6 percent), other food at home (0.4 percent), nonalcoholic beverages (0.2 percent), and cereals and bakery products (0.1 percent).
The index for food away from home rose 3.8 percent over the last year. The index for limited-service meals rose 6.2 percent, and the index for full-service meals rose 3.7 percent in the previous 12 months. On the other hand, the index for food at employee sites and schools fell sharply over the last 12 months, declining 35.2 percent.