Five trends shaping grocery in 2024

While there are signs of inflation slowing down in some countries, shoppers still don't feel optimistic about the economy or their personal financial situation. That could partly be because grocery price increases exceed other goods in many countries, including the United States.

According to The Washington Post, grocery prices have jumped by 25% over the past four years, outpacing overall inflation of 19% during the same period. To combat this, grocers optimize their payment flows to protect against economic uncertainty.

Additionally, grocers are fighting against fraudsters by pairing machine learning systems with payments data to boost their omnichannel fraud detectors. This mitigates their risk and bolsters customer's trust. Utilizing these strategies can be streamlined with a unified backend system.

After COVID forced many grocers to create ecommerce shopping channels siloed off from the in-store shopping experience, grocers are now beginning to advance omnichannel strategies that merge physical and digital shopping into a connected ecosystem. This creates a unified convenience-centered experience that facilitates cross-channel journeys like home delivery for in-store orders or buy now, pay later options.

Unified commerce is a strategy that centralizes the data you've collected about customers and products on a single platform to generate insights to improve the customer experience. With 58% of US respondents in The Adyen Index saying they would be happy to provide data to retailers if they get discounts in return, 44% of grocers say that their loyalty programs are strengthened by analyzing their payments data.

Expect grocers to focus on curated food offerings to entice shoppers in 2024. In the past year, grocers like Sprouts have introduced a curated assortment of private label offerings, and the Manhattan branch of Wegmans is offering fresh fish from Japan.

In a recent trends piece for Grocery Dive, Anne Mezzenga, co-CEO of retail podcast OmniTalk and a former Target executive, said she "expects grocers to emphasize seamless experiences by making investments in a 'smart store' concept that connects technologies. She continues, "gathering more customer data is also key, if I'm going to come in the store, you need to know me as well as you know me online, so that you can personalize that shopping experience in-store for me and make me feel like it's just as convenient as me ordering ahead and picking up curbside."

She cites Schnuck Markets using aisle-roaming robots and electronic shelf labels as an example. Those technologies help reduce shrinkage and improve inventory visibility, which makes the shopping experience better for customers. The more data collected, the more personal shopping experience a grocer can deliver.

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Grocers are actively entering the retail media space to maintain relevance with shoppers, competitiveness among retailers, and connectivity with brand partners. While digital screens and app integrations are popular examples now, more integrations are coming. Wakefern Food Corp™ placed interactive sampling kiosks in nearly 100 ShopRite and The Fresh Grocer stores. Shoppers can receive a product sample by scanning in with their phone, allowing the system to gather data and see if that trial led to a purchase.

Since the pandemic, grocers have been eager to integrate retail media solutions to improve the shopper experience and open additional revenue streams. According to Grocery Doppio's January 2024 Digital Grocery Performance Scorecard, grocers are optimistic about retail media networks and predict an average 13% rise in revenue in 2024.

Overall, grocers' challenges and opportunities are similar to those facing all retailers. Technology enables new experiences that are changing how we think about shopping. Consequently, expectations are evolving, and new players are emerging with fresh ideas and new technology to capitalize on these demands.

When faced with such changes, it can be challenging to know where to start. We understand that overhauling all your systems at once isn't practical. Instead, we recommend a data-first, iterative approach based on testing and feedback.

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