Survey outlines grocery challenges ahead

A new survey identified the leading challenges facing the grocery industry, and the results — not surprisingly — are closely tied to challenges facing the private brand sector. 

TD Bank conducted the survey of food and beverage professionals at the 2019 Groceryshop conference, held mid-September in Las Vegas, and found that nearly a third of the respondents are concerned with "new e-commerce channels," ranking as the top challenge facing the grocery industry. Second to that was "evolving technology" (26% or respondents) and then "changing consumer behaviors" (25%).

As private brands look to build on a successful 2019 and compete with national brands, many of the same challenges fall into these three categories: For example, how do private brands promote themselves and sell better on e-commerce when national brands are outspending them in the online space to get their products to the top of the search page (see Ali Dibadj session at PLMA). Additionally, keeping up with constant changes in technology, be it social tools or a rise in driving more shoppers toward buying online and picking up in-store (BOPIS). According to the survey, 34% of respondents preferred BOPIS as a way to get groceries compared to the traditional brick-and-mortar shopping method and online shopping.

Consumer behaviors such as wanting healthier foods, being conscious of spend and wanting more sustainable solutions were of concern to the respondents, but 57% said providing a convenient shopping experience was the biggest consumer behavior to impact the grocery business. All of these behaviors are challenges the private brand industry has been working to get out in front of such as developing clean label products and saving shoppers money.

Looking at revenue for the year ahead, 76% of respondents expected that grocers will grow and the market will increase.