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Walmart and Target are among the biggest beneficiaries as inflation drives shoppers to look for deals on everyday items like groceries and other household essentials. Forty-four percent of shoppers plan to shop Target Circle Week in addition to Prime Day, while 33% are considering deals from Walmart+, per Numerator.

UK ecommerce sales have bounced back to steady growth as consumer spending remains resilient despite inflationary pressures. Most major categories will see a further shift online by 2027, bringing opportunities for ecommerce retailers.

Supermarkets have the highest percentage of consumers who belong to loyalty programs (43%), followed by leading marketplaces like Amazon (37%), and health and beauty retailers/brands (28%). What it means: Consumers want the best deals and brands that make it easy will win. Brands may consider using a mobile app to provide customers with a centralized location to get all the information they need.

The news: PubMatic has announced a significant collaboration with Instacart that will allow it to harness the grocery delivery platform鈥檚 first-party retail media data for enhanced programmatic advertising. GroupM will be the first agency to participate; Mars is among the first brands using this initiative for its advertising strategies on PubMatic鈥檚 Convert platform.

The store is most important in grocery. Roughly half of shoppers who purchased a new brand or product in food and beverage (50.8%) or household supplies (48.6%) discovered it while shopping in-store. In-store discovery is also highly relevant in categories where 鈥渢ouch-and-try鈥� shopping is popular.

The 2024 implication: Despite inflation slowing in 2023, grocery prices remained high and consumers relied on deals and discounts to cover the costs. If the economy remains challenging, it鈥檚 unlikely consumers鈥� hunger for deals will let up. 4. Omnichannel strategies are a must. The insight: Kroger customers who shop in-store and online spend three to four times more than in-store only shoppers.

Walmart鈥檚 low prices and massive footprint give it an advantage in grocery. This year, Walmart Inc. will rake in $58.92 billion in US grocery ecommerce sales versus Target鈥檚 $8.10 billion, per our forecast. Meanwhile, Amazon鈥檚 massive array of products and speedy delivery time make it hard to compete with across multiple categories.

It's trying to get its grocery customers to move into non-grocery. I think in their most recent earnings call, they noted that almost half of their Walmart Plus members are coming from online pickup and delivery channels. So that's really one of the drivers of membership for them and a lot of that is grocery of course.

While Jassy pointed to grocery as a huge growth opportunity in his recent letter to shareholders, he also acknowledged the company is yet to find a mass grocery format worth expanding, despite significant investments in its Amazon Fresh banner.

Walmart is also a go-to destination for groceries for all consumers, visited by 鈥嬧��68.3% of households earning less than $25,000 and 44.7% earning more than $200,000. What it means for marketers: No matter their income, consumers are drawn to Walmart鈥檚 value-driven mission and extensive product variety. Marketers can further their emphasis on value through ad messaging. 2.

Walmart鈥檚 clear value proposition drove shoppers across all income levels, helping it win share鈥攅specially in the grocery category, which it already dominated. And its Walmart+ membership service helped it retain those customers by offering online orders quickly delivered to their doors at no additional cost.

The stat: Over half (60%) of holiday season spend to-date was driven by five categories, according to Adobe Analytics鈥攅lectronics ($21.7 billion), apparel ($19.2 billion), furniture ($14.7 billion), grocery ($6.8 billion), and toys ($3.1 billion).

Getting its costs in check: Amazon has been on an ongoing push under CEO Andy Jassy to focus squarely on its core businesses鈥攍ike ecommerce, grocery, advertising, and AWS鈥攁nd aggressively cut costs wherever possible.

Fresh supermarkets are fascinating because Amazon closed several of these last year, and now they're leaning back into it. Grocery in person is not something that Amazon's been able to get right. Clearly, if they're opening these supermarkets, they have money to burn on trying to get it right so fascinated to see if this actually works this time. Zak Stambor (12:32):.

Nearly half (45.7%) of all US pet products sales will be made online by 2025, the highest ecommerce penetration of all grocery products. In 2020, the number was only 31.0%. Retailers are leaning into that desire by offering subscription programs, which, in addition to streamlining the shopping journey, help to increase repeat engagement among customers. 3. But online behaviors are changing.

It's not a Canada-specific problem to see inflation affecting grocery store pricing, however, the report outlined a significant concern that three grocery giants were unfairly manipulating the market. Loblaw, Sobeys and Metro own the vast majority of grocery stores in the country, often under different guises.

Other sectors with high conversion rates and CPAs were clothing, shoes, and jewelry (conversion rate of 5.5%; CPA of $66) and grocery and gourmet food (4.94%; $53). Some sectors had much higher CPAs with low conversion rates. Home and kitchen had CPAs of $77 but a conversion rate of just 1.3%. Automotive had the highest CPAs at $78 but held a 1.4% conversion rate.

The drawbacks: On the flip side, the shift in spending from high-margin discretionary categories like apparel and home decor to low-margin groceries has hurt gross profits, leading discount retailers to invest in private labels and higher-priced store concepts, and in some cases temporarily stop stocking certain items.

Both Walmart and Dollar General have observed an influx of higher-income shoppers as prices (specifically in the grocery/consumer packaged goods category) remain high. Mall staples like Macy鈥檚 are struggling as consumers pull back their discretionary spending. There鈥檚 a lot of empty real estate.

Budgeters make less of a distinction between debit and credit: They鈥檙e more willing to use credit for daily purchases, though they鈥檒l still use debit for recurring transactions like rent, groceries, and utilities. They鈥檙e also highly strategic in payments usage, reserving specific cards for specific kinds of payments, though they do rely heavily on one top-of-wallet card.

Why restaurant sales are rising: While food prices have soared throughout the past year, prices have risen at a slower rate at restaurants (8.2% YoY in January) than at grocery stores (11.3% YoY in January), per the US Labor Department.

When the cost of groceries and other essentials are eating up a bigger share of consumers鈥� wallets, they cut back on expenditures like dining out and entertainment, our analyst Blake Droesch said. Weekly visits to dining chains nationwide trended downward YoY throughout 2023, per a February 2024 report by Placer.ai. AI to the rescue?

Even apparel, footwear, and accessories, the biggest ecommerce sales category, is expected to lose ground to grocery when combining food and beverage with personal care, cleaning, pet, and baby products. Digital transformation: Health, personal care, and beauty will undergo the biggest digital shift among categories. By 2028, 29.5% of its sales will come from ecommerce, up from 20.1% in 2024.

Walmart has made headlines for higher-income shoppers trading down on groceries. Another strong area is the Walmart+ program, which has grown among younger shoppers who may have less spending power. As of December 2022, 23% of respondents to an Insider Intelligence survey conducted by Bizrate Insights said they subscribed to Walmart+, up from 11% in June.

At the same time, more shoppers are using the service to purchase essentials like groceries, whose share of BNPL spending has risen by 37.5% this year. Overall, BNPL users spent $46.7 billion so far in 2023, a 14.7% increase YoY.