With the holiday season almost here, new research from FMI – The Food Industry Association found consumers’ concerns about high food costs are impacting their grocery shopping behaviors and enthusiasm during the critical selling period.
Half of surveyed consumers said they’re concerned about rising prices for holiday celebrations, according to a new report from the trade group.
This ties into growing worries about food prices. Sixty-eight percent of consumers surveyed at the end of September and early October said they are worried about prices rising on their preferred foods, up from 62% who said this in August and nearly double those who had this worry (35%) in March 2020, per FMI’s holiday season report.
Even though the pace of inflation has slowed and food prices at grocery stores have stabilized, many consumers are preparing to “make do with less” this year, FMI President and CEO Leslie G. Sarasin said during a press call last week.
“Somewhat surprisingly, shopper concerns about the rising cost of food have remained high over the last year, while concerns about gas and holiday gift prices are down slightly from last year,” Sarasin said.
To address price concerns, consumers say they’re seeking more deals (30%) and preparing more dishes at home (24%). Fewer consumers said they plan to buy more expensive ingredients than usual for Thanksgiving, December holidays and New Year’s.
Deals, promotions and savings on holiday meals have been a major focus this year for grocers. Weis Markets is letting its customers redeem their Weis Rewards points for free turkeys or hams. ShopRite is offering one free turkey, ham or a product from a selection of plant-based, vegetarian, gluten-free, dairy-free or Kosher items to Price Plus Card customers who spend $400 from Oct. 15 to Nov. 23.
Target is offering a four-serving feast for under $25 that includes a 10-16 pound turkey at less than $1 per pound and various sides for less than $5 each.
Fewer shoppers surveyed by FMI said they plan to shop further in advance than usual this year for Thanksgiving, December holidays and New Year’s, with Thanksgiving seeing the largest drop of 6 percentage points.
“Shoppers are being prudent and tactical with their purchases to stay within their budgets and are more prone to just-in-time shopping rather than loading up their carts as we have seen previously back when they were much more worried about supply and out-of-stock[s],” Sarasin said.
Consumer enthusiasm dropped for New Year’s compared to last year
Meanwhile, a higher percentage of consumers said they will shop around at different grocery stores more than usual for Thanksgiving (up 5 percentage points) and New Year’s (up 2 percentage points) compared to those who said so last year.
Thanksgiving will be very “status quo” this year, FMI said, based on its findings that a majority of shoppers said they’ll celebrate about the same as usual. FMI’s report mirrors recent findings from Circana that shoppers aren’t changing their Thanksgiving plans but are looking for more savings.
For the December holidays, nearly one-third of shoppers said they plan to spread out purchases over time to avoid a bulk shopping trip, per the report.
New Year’s Eve is the only holiday shoppers appear to be less excited about compared to last year, the report found. Nearly 60% of shoppers said they plan to change their shopping routine for this holiday, up 5 percentage points from last year.
Sarasin noted that grocers’ apps can provide sales, deals, coupons and pricing information to help consumers budget before they shop.
Grocers’ registered dietitians can help consumers plan meals, suggest different recipes or ingredients that can be substituted for traditional holiday options and help consumers reduce food waste, she added.
Consumers can turn to grocers whether it be for “supplying the sides to supplement a home-cooked holiday meal or as a way for the time-strapped shopper to purchase a fresh holiday meal for less than it would cost to eat takeout from a restaurant,” Rick Stein, the trade group’s vice president of fresh foods, said during the press call.
The report, which is based on a survey of 1,610 grocery shoppers between Sept. 28 and Oct. 6, is the fifth and final report in FMI’s series focused on 2023 grocery shopping trends.