The COVID surge for supermarkets
The pandemic hit many retailers hard, with stores shut and high streets deserted. But shopping for food continued and supermarkets – the leviathans of the grocery segment with up to 95% share – have not only kept their doors open, but have seen a massive surge in demand, online and in brick and mortar stores.
According to industry experts The Grocer magazine, UK supermarkets continue to see high levels of growth. They quote research from NielsenIQ, that shows that sales for February 2021 grew by 10.6% year on year.
With restaurants closed, we’re eating at home more – the US has seen at home food consumption up 50% and the UK 30% since the start of the pandemic. As Susan Barratt, CEO of analysts IGD, says: “Supermarkets continuing to benefit from the ongoing closure of non-essential retail and the out-of-home sector.”
The pandemic has increased demand for local produce and in April 2020, Google searches for ‘local food’ increased. Supermarkets want to mitigate supply chain vulnerabilities, such as the virus impact in supplier countries or restrictions on the transportation network.
For those whose disposable income has been reduced as a result of the pandemic, value is more important than ever. Lower income households want to reduce their spend and in McKinsey’s Grocery Retail survey 37% of respondents said they will look for ways to save money on grocery shopping.
In such a shifting environment, how do supermarkets ensure that they continue to deliver an uninterrupted service to customers, and capture maximum opportunity? How retail is changing, the process transformation offers opportunities to differentiate and adapt.
The last word
2020 was a record year for supermarkets, and whilst the market may contract a little once the pandemic is over, all indications are that it will not return to pre-COVID levels, but will retain some of the growth from the pandemic surge.
If supermarkets are to take advantage of how retail is changing, and continue to serve and delight their customers without interruption, they’d do well to heed the words of Marc Poulin, the former CEO of Sobey’s, in his interview with Oliver Wyman – Management consultants: “The retailers who will recover most strongly are those who evolved to meet consumer demands by adapting their business model.”
How to use data to improve customer experience in retail
Ask any retailer and they’ll tell you that an enhanced customer experience is at the top of their ‘must [...]
mPOS – bringing back the human touch to in-store shopping
As shoppers return to brick and mortar stores in their drovers, they crave the in-store experience. Retailers who want [...]
AI in retail – transforming the future of shopping
Artificial Intelligence has become embedded into our everyday lives – every time we ask Alexa for the weather, or [...]