Report: Traditional Supermarkets to Decrease 24% by 2021
LONG GROVE, Ill. — The traditional grocery store is in decline, due in large part to changes in shopper preferences and behaviors.
Shoppers are gravitating toward shopping formats that fit their needs in ways that traditional grocery stores often no longer do, according to a recent study from Long Grove-based consultancy Inmar Willard Bishop Analytics.
The study, Future of Food Retailing 2017, predicts that while there will be modest growth in dollar share for the traditional grocery channel, there will be massive fluctuations within the channel.
"By 2021, dollar share for the traditional grocery channel will reach 44.4 percent, an increase of 0.2 percent," according to the study.
However, the report also states, "The number of traditional supermarkets will decrease by 24.6 percent. This decline is offset by double-digit growth in store counts for fresh-format, limited-assortment, and super warehouse formats."
The convenience channel will see a slight increase in share, reaching 16.5 percent by 2021, the study estimates.
Food retailers are expected to adopt ecommerce more quickly than other retail sectors, leading to exponential growth in the grocery market. The promise of big sales from food and consumables across all channels, in addition to millennials’ digital acumen and time-starved consumers' need of convenient options, are driving the speedy adoption.
The Inmar Willard Bishop Analytics study warns that although grocery ecommerce shows great promise, success will require a strategy that makes relevancy a major focus.
"All choices must be relevant to the target audience. Relevancy must be reinforced at every touchpoint along the path-to-purchase continuum," the report states. "Social media content must focus on relevant activities prior to the start of a purchase cycle. Assortment, merchandising (in-store and online), pricing, promotions and services must all be relevant in order to influence shopper behaviors."
Click here for more on this story from Convenience Store News sister publication Progressive Grocer.