Fewer Shoppers Stray from Grocery Stores

By Pan Demetrakakes

“Category blurring” in grocery purchasing is down from last year, according to a survey from King Retail Solutions.

In its 2015 consumer insights poll, KRS reports that 62 percent of respondents reported buying groceries from a retailer other than a grocery store, compared with 77 percent last year. The report suggested that this may correlate with a heightened emphasis on food quality—a view that is supported by details of where these purchases are being made. Of non-traditional places to buy groceries, convenience stores and “big-box” stores (a category that includes Walmart and Target) were both down 7 percent, while “farmers market/local stand” was up 21 percent.

That surge moved “farmers market” up to fourth on the list of places to buy groceries besides grocery stores. Nonetheless, Walmart, Target and Walgreens retained their top-three rankings on that list this year. The most popular food items purchased at non-groceries were canned and boxed goods (69 percent of respondents), dairy foods (52 percent) and bread (50 percent). Canned/boxed goods and bread were both up in this regard from last year, while dairy was down slightly.

Another aspect of category blurring addressed in the KRS report was buying fresh prepared foods at places other than restaurants. Grocery stores were, unsurprisingly, the leader in this regard, at 75 percent of respondents, followed by big box stores (35 percent) and convenience stores (18 percent). Grocery stores were up slightly in this category, while big-box stores had a 9 percent decline in such purchases from last year, and convenience stores, 10 percent.

As destinations for people to buy fresh prepared stores outside of restaurants, the top five were Walmart, Target, Kroger and related banners, Albertsons/Safeway and Whole Foods. Kroger and Whole Foods rose from last year’s ranking, while Walmart, Target and Albertsons stayed in place.

“When we first started doing this annual consumer research project, which was just a couple years ago, we knew we were onto something with the category blurring,” says Andrew Swedenborg, KRS’ executive vice president. “But then we realized pretty quickly that it goes way beyond category blurring, really to the heart of consumer values. So that was our focus this year. We asked people about all the various ways they can be out there shopping. Online, on their phones, via subscription, and of course in-store.”

The KRS survey extensively probed smartphone use, finding that 51 percent of smartphone users have loaded a shopping-related app, and that 61 percent of them use their phones in some way for shopping in-store.

Grocery stores, however, have lagged behind other sectors in smartphone penetration. On a list of retailers ranked according to how many consumers have downloaded their shopping app, the highest-ranking CPG retailer is Walgreens at No. 13 (3 percent), and the highest-ranking pure grocer, at No. 15, is Safeway (2 percent).

Groceries also ranked last among five product categories as to consumers’ desire to pick up their online orders in-store. The report suggested that this was because groceries are among the least likely items to be returned, which means that consumers had more motivation for the convenience of home delivery: “If you absolutely know you won’t be returning that pizza, why pick up in-store at all? Delivery makes more sense.”

To download the KRS report, click here.