Chloe Riley is the Executive Editor of Supermarket News, which delivers the ultimate in competitive business intelligence, news and information for executives in the food retail and grocery industry. A graduate of the School of Journalism at Columbia College Chicago, Chloe previously served as a Digital Strategist at SEO firm Profound Strategy, Associate Editor at B2B hospitality mag HOTELS Magazine, as well as CEO of her own digital strategy company, Chlowe.
A recent consumer outlook via Deloitte kicks off with a great question, which is:
“Was 2022 a good year or a bad year for the industry?”
So, which is it?
I like to think of myself as a glass half full kind of girl. In that case, let’s look on the positive side of things. According to Deloitte’s vice chairman and leader of retail and consumer products, Nick Handrinos:
- On the food manufacturer side, the sector has created a lot of value
- Despite high prices due to inflation, retailers have still managed to stay in shoppers’ good graces
- The past several years have been just about as volatile as it gets. And so from that perspective, hats off to management teams across the board — retailers and manufacturers — who have weathered the storm brought upon by the pandemic
So, in some ways, it’s been a good year. Though, maybe “good” isn’t exactly the right word. It’s been a year full of opportunity. That feels more right.
Looking ahead to what the consumer wants, it’s both pretty simple and pretty complicated all at the same time. The shopper of today feels price gouged — exhausted by high prices and low on loyalty. On the flipside of that:
- Eight in 10 retail executives in the Deloitte survey say they consider the changing consumer as one of their greatest challenges, and 93% say keeping up with changing consumer demands is a priority
- Sixty-three percent of retail executives say “decreased willingness to pay higher prices” is a consumer change that is very problematic for their company
- And two-thirds of executives agree that consumers’ purchasing preferences have changed considerably over the past 12 months
So, consumers are starting to feel priced out, and retailers are aware of that. Where does that leave us? According to Handrinos, the first half of 2023 will see continued price increases, but the second half will bring price decelerating, and with it, relief for shoppers.
Hang in there, grocers.