蘑菇AV

In a recent meta analysis, Grocery TV discovered that consumer packaged goods (CPG) brands averaged a 14% increase in incremental sales when advertising through its in-store retail media network.

Our take: Concerns around consumer financial health are swirling thanks to apprehension around tariffs alongside existing inflationary pressures on necessities like groceries, and conditions are unlikely to improve any time soon. As consumers鈥� finances stay on shaky ground, it will become even more difficult for them to make these emergency purchases.

On today's episode, we discuss a part of digital ad spending that will overperform this year, why some countries will see a dip in online shopping, what will happen to time spent on social platforms, and more. Tune in to the discussion with our forecasting writer Ethan Cramer-Flood, analyst Zach Goldner, and director of forecasting Oscar Orozco.

Adjacent innovations: Grocery stores adding prepared foods, meal kits, and wellness products. Premium services: High-end retailers offering styling services that can command additional fees. Brand collaborations: Limited-time partnerships that drive urgency and store visits. What it means: The value of a store visit extends far beyond the immediate transaction.

Categories like grocery, with strong domestic supply chains, may prove more resilient than general merchandise retailers dependent on international suppliers. Last-mile intermediaries gain commerce media share. Commerce intermediaries like DoorDash and Instacart are carving out a meaningful share of commerce media revenue, confirming one of 蘑菇AV's key predictions from last year.

They will earn 2 points and tier credits for every $1 spent on hotels, dining, gas stations, and grocery stores. Cardholders will earn 1 point and tier credit for every $1 spent everywhere else, including deposits on BetMGM, the company鈥檚 online sports betting and gaming platform. Cardholders will also get a $200 resort credit upon account opening and on their card anniversary each year.

How we got here: As prices remain elevated, Gen Zers鈥� parents鈥攎ainly younger baby boomers, Gen Xers, and older millennials鈥攈elp them with groceries, cell phone bills, health insurance, rent or mortgage payments, and tuition costs. They believe these strains are temporary, however: 37% of parents expect to stop payments within two years and another 28% in three to four years, per Fortune.

Tesco鈥檚 newest venture takes aim at Ocado: The UK grocer鈥檚 Transcend Retail Solutions division aims to help international supermarket chains develop their ecommerce operations.

Consumers are particularly worried about how tariffs will affect the cost of groceries and other household goods, according to a separate poll by Numerator. Hunkering down: As shoppers brace for higher costs, they鈥檙e finding new ways to manage their spending. Households are doing laundry less often to save money on detergent, P&G CEO Jon Moeller said.

The ecommerce boom in Canada means many product categories now sell a significant percentage online. This includes grocery, which we forecast for the first time this year.

Retail foot traffic is bouncing back, especially in malls, thanks to diverse tenant mixes and engaging experiences that attract shoppers, Ethan Chernofsky, senior vice president of marketing at Placer.ai, said during a recent 蘑菇AV webinar. The pandemic鈥檚 lasting influence has also changed how we shop, with more people visiting multiple grocery stores for the best deals and quality, while small-format stores are helping retailers meet local needs.

The news: Costco鈥檚 comparable sales jumped more than expected in Q4, as shoppers happily splashed out on big-ticket items like 99-inch televisions and gold jewelry and visited the retailer more often to purchase groceries. Comparable sales rose 6.8% YoY during the holiday quarter, outpacing expectations for a 6.4% rise.

That shift has allowed the retailer to grow its grocery share, but at the expense of its profit margin, which fell eight basis points YoY to 29.4%. Exposure to lower-income households also makes the chain vulnerable to potential changes in SNAP funding. Amid a more challenging environment, Dollar General is rethinking its aggressive expansion strategy.

Private label grocery brand growth reached 3.9% in 2024, significantly outpacing national brand growth鈥檚 1.0%, according to the Private Label Manufacturers Association (PLMA)鈥攚hich doesn't even keep pace with inflation. This growth pattern may continue as economic pressures persist.

More than other generations, Gen Z shopped for every non-grocery retail category online, except home furnishings and alcoholic beverages. Key stat: Economic uncertainty has consumers putting off plans for renovations.

While intermediaries鈥� share of ecommerce sales (grocery or otherwise) will remain relatively flat for the next couple of years, they鈥檙e still a long-term threat to traditional retail. But there鈥檚 an opportunity for retailers to use intermediaries鈥� strategies against them.

That鈥檚 true for both everyday necessities like groceries as well as discretionary categories like apparel and toys.

Third-party grocery intermediaries lost share to grocer platforms in 2023, securing 15.2% of US digital grocery sales in Q4, down from 18.3% in Q1, according to December 2023 data from Incisiv and Wynshop.

Since the pandemic, online ordering and delivery have become table stakes for the grocery industry. Retailers like Albertsons have begun to develop tools and capabilities that provide added value for customers, focusing on creating a more convenient experience. 鈥淐onsumers think about food 226 times a day, that鈥檚 a lot of cognitive load,鈥� said Jill Pavlovich, senior vice president of digital shopping experiences at Albertsons Cos. 鈥淪o we want to take the experience from a transactional one to a helpful set of tools that can help people manage this.鈥� Albertsons leveraged customer data to identify areas for improvement across its website and mobile app.