Members talk 2023 outlook and shopper behavior

January 17, 2023
By Jackie Lewis, VP of Content for CMA | SIMA

As we enter the new year retailers and consumer goods companies seem cautiously optimistic that a slow but steady moderation in inflation should bode well for the US consumer in 2023. The US Bureau of Labor and Statistics December inflation numbers ticked down, mostly driven by gasoline, but food prices also moderated slightly. Holiday 2022 appeared to shake out relatively successful, especially on key promotional days, with a healthy combination of in store and online shopping.

The CMA and SIMA strive to stay on top of these trends and specifically how they impact the category management and shopper insights functions. One of the ways we do this is through our quarterly private networking groups (PNGs) made up of suppliers and retailers to discuss industry pain points and best practices.

While the full notes remain available to participants only, we wanted to share some of the key takeaways from meetings held in 4Q (October-December). These are meant to both inform on real-time industry topics and make members and non-members aware of the networking opportunities available through ARC (The Association for Retail and Consumer Professionals).

Key Takeaways for Retailers

  1. Retailers are treading cautiously into 2023 particularly as costs remain elevated and inflation is top of mind for consumers. While down from peak, participants agree some level of inflation could persist into 2024.
  2. There has been a level of ‘mass normalization’ in shopper behavior this holiday season with the uncertainty of a looming recession balanced by a desire to spend and celebrate.
  3. Hiring remains a challenge and a general malaise among candidates has been observed over the past 4-6 months. The desire for maximum flexibility and salary levels are not aligned with current retailer offerings. Tapping internal talent either from the store level or rotational programs has been successful for some.

Key Takeaways for Small to Mid-Sized Manufacturer

  1. Participants agree that multipacks and multi-serve sizes are selling incredibility well across dairy, beverage, and dry grocery in the wake of inflation.
  2. Club channel demand remains high despite inflationary pressures, and larger pack sizes seem to be selling better in other channels as well. Participants agree most are waiting to do elasticity modelling until after 1Q23.
  3. Some acceleration in eCommerce sales is being observed, attributed to its use as a budgeting tool for price conscious shoppers (adding/removing from the cart for a running total).

Key Takeaways on Hispanic Shoppers

  1. Shopper behavior trends related to inflation have been more in tune with income bifurcation in US shoppers generally vs. any Hispanic specific shopping trends.
  2. Hispanics tend to research more heavily online compared to overall shoppers. In-aisle mobile research has indexed very high since the beginning of COVID, and Spanish specific content and/or QR codes can help fill this shopper desire and drive more sales.
  3. Retro-acculturation seems to be gaining some momentum, as formerly ‘acculturated’ shoppers are returning to their roots and embracing their native language and traditions as they get older and raise families.