Podcast by Supermarket News
Back-to-school boosts opportunity for private brands
With the return of students nationwide to school, after a year of remote and hybrid learning, grocery retailers are anticipating a successful back-to-school selling season. For our latest Off the Shelf podcast, Supermarket News spoke with Aimee Becker, senior vice president strategic advisory at Daymon, a leader and pioneer in private brand development, about the latest trends in back-to-school at retail, the importance of private brands to the category, and the impact of the pandemic on category sales and shopping behaviors as students return to schools.
Becker noted that there are two key factors affecting shoppers as they think about this year’s return to school.
“First, we're really seeing that consumers are being a bit more cautious. With everything that's going on in the world, they're just making sure that they're thinking about their purchases and really thinking about more of a just-in-time inventory in their house, if you will, or pantry stocking, because they want to be prepared for what's to come,” she said. “The second thing is, due to commodity prices and labor shortages, consumers are actually seeing price increases across categories. So, something that's really different this year is that retailers are really in a position to help shoppers not only plan, but really stretch their budget. And that's one of the things we're really excited about, the role private brands can play because they really do play a role in bridging that gap for consumers.”
With consumer trust in private brands at an all-time high, there is a great opportunity to provide consumers with back-to-school products at value prices — from classroom supplies and apparel to snacks and lunch foods and, this year particularly, sanitizers and face masks.
Another trend impacting this year’s back-to-school shopping is the growth of e-commerce. “We're hearing that about 50% of consumers are anticipating shopping online more this year than last year,” said Becker. “So when it comes to marketing — and marketing for back-to-school specifically —omnichannel is more important than ever, making sure that you're appealing to shoppers across platforms and really driving your message across platforms. When it comes to specific messaging, really making it easy for the shoppers — not necessarily talking about the products that we're selling, but more of the solutions that we're bringing, the problems we're solving, the emotional side of how you get stuff done at this time of year. We're definitely thinking that that's going to play a much stronger role as people are really looking to problem-solve as they're heading back to school.”
For more insights from Aimee Becker of Daymon, including marketing strategies for a return to the “lunchbox,” growing awareness of sustainability in back-to-school products and harnessing the power of social media to reach shoppers, listen to the full podcast.
Podcast: NGA’s Greg Ferrara says independent grocery packs economic punch Industry’s sales surpassed a quarter-trillion dollars in 2020
The importance of the community grocer became more apparent than ever before during the COVID-19 pandemic. But what might not be as apparent is how much of an engine the independent grocery sector is to the U.S. economy.
In mid-June, the National Grocers Association (NGA) released new research on the independent grocery sector’s overall economic impact, including its direct and indirect impact in dollars and employment. Not only does this industry account for about a third of national grocery sales and over a percent of U.S. GDP, but it also has a hand in the creation of millions of jobs and billions in wages and tax revenue.
According to Greg Ferrara, NGA president and CEO, an updated report on the independent grocery industry’s economic contribution was “long overdue.”
“When we [first] did this study, it was 2012 data released in 2013. And it was incredibly well-received not only with our stakeholders here in Washington, D.C., but also across the industry. It had never been done before,” Ferrara told Supermarket News in a podcast interview. “Our supply chain partners, CPG companies and others really appreciated the opportunity to get a glimpse of what the contributions of independents were across the supermarket channel. So it was long overdue for us to update this data, and we’re glad we were able to get this out this year. The feedback so far has been incredibly positive already.”
Independent grocers now represent 33% of overall U.S. grocery sales, up from 25% nearly a decade ago, according to NielsenIQ/TDLink data cited in NGA’s research, conducted by John Dunham & Associates. Sales by the independent supermarkets rose nearly 94% to $253.61 billion in 2020 from $131 billion in 2012, the year of Washington-based NGA’s last economic impact study.
“It has been just under 10 years since we did this study, so we were expecting to see some increases,” Ferrara said.
At a macro level, independent grocers accounted for 1.2% of the 2020 U.S. gross domestic product of $20.93 trillion, with the industry’s total output exceeding $255 billion, NGA said. The sector encompasses 21,574 stores nationwide. In 2020, independent supermarkets provided 1.11 million jobs and generated wages of $38.54 billion. In addition, NGA said, wholesalers serving independent grocery provided more than 44,000 jobs totaling wages of nearly $3.3 billion.
“We are huge job creators in this country and are providing great careers to our fellow Americans,” Ferrara said.
“What really was pleasing to us was to see the [market] share of independents increase from around 25% to 33% of total grocery,” he added. “When we take a step back and look at our membership, a lot of the regional chains and other independents across the country, they have been consistently adding stores and growing their businesses substantially. So it make sense to us that we would see an increase in the share.”
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The real threat of Amazon Fresh lies in delivery, says Brick Meets Click’s Bill Bishop
With the news last week that Amazon plans to expand its new Fresh store concept to 28 more locations, the retail giant gave notice that it intends to be a serious player in the omnichannel grocery space. The Seattle-based retail giant is “quietly building a national grocery chain,” Bloomberg reported last week, with Amazon Fresh stores in the works “from Philadelphia to the Sacramento suburbs.”
Retail industry expert Bill Bishop of Brick Meets Click was not surprised, and in fact has been expecting this move.