2024 signifies a pivotal moment for brands and their retail partners, as shopper spending habits shift markedly, private label makes waves, and new marketing strategies reshape the industry. A 10% year-over-year drop in units sold in the second half of 2023¹ highlights the urgency for adaptation, focusing on value delivery and innovation — at immense scale.
In this article, we reveal bold predictions and strategies to maximize store visits, drive massive sales volume, and overcome key challenges facing marketers in the year ahead.
Opportunities for Retailers
What is the biggest opportunity for retailers in 2024?
In 2024, retailers should double down on delivering and communicating value to maximize online and offline store visits. Despite YoY store visits declining — a sign of inflation impacting purchasing power — shoppers are now visiting twice as many distinct stores as they were 10 years ago,² and 54% say they would change stores to find savings.³ This trend of heightened value-seeking and channel shifting highlights a challenge: retaining the same percentage of a shopper’s basket is becoming increasingly difficult.
For a key competitive advantage in 2024, retailers will need to deliver the savings that shoppers are looking for and expect to receive through personalized, targeted offers — on staples, new items, and their favorites — helping to drive repeat trips, increasing traffic, basket sizes, and easing the burden of prices rising over the last few years.
How will retailers innovate their digital offer programs?
While market fluctuations are inevitable in 2024, retailers should stay proactive — optimizing their digital offer programs to deliver the greatest amount of shopper value possible.
One quick way retailers are optimizing their digital offer programs is by providing shoppers with more options. This can include more offers across a shopper’s existing basket, offers that are more adjacent to existing purchases, or others that are identified as relevant, as well as entirely new items that fit with their buying habits.
The way retailers are achieving this is by providing shoppers with more than 6X the volume of national offers available, compared to Ibotta’s closest competitor. Through the IPN, retailers can promote over 1,000 national CPG offers and more than $2,500 in daily savings on their properties. Cash back offers can be used to establish a digital wallet where logged in customers can bank their rewards and use them to save on future purchases in stores and online, or use them on their next shopping trip.
What’s next for private label?
There has already been an unprecedented shift to private label purchasing in recent quarters. On some private label products, sales outpaced their national brand competitors by more than 5X. On average, the growth rate for a randomized private label sample was 2.3X that of their national brand competitors.⁴
Consumers were encouraged to try private label alternatives due to inflationary pressure, but many have found those products to exceed their quality expectations — private label brands are sticky. In fact, 76% of shoppers who switched from a national brand to private label in 2023 purchased a private label product in the same category on their next trip.⁵
Given this landscape, retailers face a promising opportunity to shore up store visits with their private label offerings, capitalizing on shifting consumer preferences, while national brands must now navigate the challenges of innovating and recapturing consumers.
Opportunities for Brands
What are the biggest opportunities for brands in 2024?
Ibotta data shows that 106 categories experienced private label switching where shoppers moved from branded products to private label items, across a 12-month period from early 2022 – 2023. Brands will need to win back shoppers from private label through promotions that drive efficient revenue growth from incremental sales and repeat purchases.
As brands have relied on pricing strategies to fuel both revenue and margin growth, declining volume and market share are now offsetting these efforts. Thus, it's imperative to focus on promotional strategies that accelerate volume in addition to incremental sales.
In the chart below, see how the pricing actions of a multinational food & beverage manufacturer led to volume declines that offset net gains.
YoY Quarterly Sales Growth (US)
(Of a leading Food & Beverage Manufacturer)
The strategic deployment of digital offers, coupled with a precise grasp of incrementality, is revolutionizing the game for brands across CPG and General Merchandise by offering the ability to drive significant incremental volume at a more efficient return on investment compared to other media tactics. These brands are seizing a coveted first-mover advantage through the strategic use of IPN offers, collaborating with major retailers like Walmart and Dollar General to drive efficient revenue growth.
When you layer the seamless integration and incredible return of digital offers onto retail media, you amplify the effectiveness of those tactics as well. Advertisers on the IPN average a 50% lift in incremental units sold, with 42% of conversions being new-to-brand, and a 7X return on ad spend (ROAS).
How will brands innovate their digital offers to maximize results with retail partners?
In 2024, brands will make the shift to pay-per-sale promotions vs. pay-per-clip to drive YoY growth with key retailers like Walmart, Dollar General, Kroger, and more. The rollout of DG Cash and manufacturer offers at Walmart marks a critical innovation and strategic opportunity for brands to re-think legacy tactics and evolve with the expectations of consumers and the ever changing promotional landscape that they operate within. Ibotta’s AI-driven network represents a major opportunity for brands to reach 91% of American households⁶, unlocking measurability of spend and ROI at unprecedented scale.
Continue reading the full article for a deeper dive into opportunities for brands and retailers, CMO Perspective: Marketing & Technology, plus actionable steps forward.
Ibotta is a leading data source for both incentivized and organic purchases from in-store and online grocery sales across all major US retail channels. Ibotta's first-party SKU-level data provides insights into shopper behavior across 4B purchases annually.
¹ Ibotta first-party data, 2023
² Coupons in the News, 2023
³ Winsight Grocery Business, 2023
⁴ Ibotta first-party data, 2023
⁵ Ibotta first-party data, 2023
⁶ Circana Scan Panel; Total US – All outlets; 52 wk ending Nov 2023