Last week Heather Lalley pointed out in an article that inflation was driving consumers to make different choices when it comes to buying groceries. So, the team at Foodservice Solutions® wanted to see if those choices held true for consumer in in the omni-channel grocerant niche. Turns out they are very similar but we noticed a trend where consumers are buying more meals from the drive-thru. When consumers were asked where Americans get dinner, most (77%) commonly eat at home or cook for themselves. 50% say they regularly get takeout or pick up, 31% say they go to restaurants, and 3% say they use a meal subscription box.

Looking at data from recent grocerant niche scorecards Steven Johnson, Grocerant Guru® at Tacoma, WA based Foodservice Solutions® found that 83.6% of all restaurant meals in 2022 are purchased from a fast food outlet or drive-thru.

Regular readers of this blog know that last week Walmart made headlines, when it lowered its earnings forecast, saying higher prices on food and other items were causing consumers to cut back. The largest retailer in the country also noted it was being forced to slash its prices to keep inventory moving.

Walmart’s announcement as Lalley pointed out “prompted analysts from the Royal Bank of Canada to declare they’re feeling “increasingly cautious on the state of the U.S. consumer.”

Lalley continued, “Food-at-home inflation soared 12.2% in June over the year before, a 40-year high, according to the Consumer Price Index. And the Federal Reserve on Wednesday approved a three-quarters of a percentage point interest rate hike, its second in a row, in an aggressive push to put a lid on inflation.

Even though economists have yet to declare a recession, 53% of Americans believe we’re already in one, according to the mid-year consumer report from NielsenIQ. Here are six ways historic inflation is pushing consumers to change their grocery shopping habits—and how retailers can capitalize on them.

1. They’re looking for lower-cost options.

Perhaps its no surprise shoppers are searching for deals as inflation soars. For some retailers, that means it’s prime time to promote private-label brands. Albertsons Cos., last week said its Own Brands line reached record-high sales penetration of 25.8%, with sales outpacing national brands in several categories.

During the first quarter, Albertsons launched 59 new Own Brands items, with a plan to roll out about 425 new products in the line this year.

“While much of the growth in Own Brands is related to increases in unpenetrated markets and product innovation, the breadth of our Own Brands portfolio from opening to premium price points also provides great value to customers who are trying to stretch their budgets,” CEO Vivek Sankaran told analysts, according to a transcript from financial services site Sentieo.

2. They’re shopping less often.

Gas prices are finally starting to recede a bit, but they’ve no doubt had an impact on consumer behavior.

Thirty-four percent of consumers said they’re driving less, 25% said they’re shopping online and 24% said they’re shopping closer to home, according NeilsenIQ. Research from retail data science platform 84.51° put the number even higher, finding that 56% of consumers have reduced their driving because of high gas prices and 34% are grocery shopping less frequently.

Inflation, too, is prompting shoppers to visit the store less often.

By the first quarter of this year, food traffic to food stores had fallen 10% compared to the same period a year ago, according to location intelligence firm Gravy Analytics.

Click here to read the full Retail Wit article.