U.S. shoppers are spending more on groceries this year as they balance their desire for quality and healthiness with the higher cost of food, including seafood, according to two new surveys.
Besides cost, American consumers are also considering eating well, quality, nutrition, freshness, convenience, family food preferences, individual cooking skills and habits, and individual shopping experiences when deciding whether to purchase a particular food product, according to the Food Industry Association (FMI) Vice President of Research and Insights Steve Markenson. Health attributes, quality, and sustainability are also factors in seafood-purchasing decisions being made by U.S. consumers in 2023, Markenson said.
“It is much more complex, where the lowest price isn’t necessarily the king,” he said.
FMI’s 2023 Grocery Shopper Trends report, which was based off a survey of 2,000 consumers conducted in February 2023 in partnership with the Hartman Group, revealed the rising cost of food ranks at the top of shoppers’ economic concerns, with 75 percent saying they are more concerned about that than the price of gas (69 percent), food from restaurants (55 percent), rent and housing (44 percent), and clothing (44 percent), FMI stated.
The survey found 68 percent of shoppers said they are spending more on groceries now than they did a year ago, Markenson said. Despite high inflation, most shoppers are not completely eliminating food categories that are important to them.
“[Shoppers] have gotten very savvy, very flexible, very creative, and also very prudent when it comes to their food purchases,” he said. “They are being very smart by looking for deals, they are shopping at multiple stores, they are looking online to compare prices, and they are buying more private brand products than ever before.”
Americans are buying more frozen seafood, Markenson said, referring to a critical finding of FMI’s 2023 Power of Seafood report.
“With frozen seafood, you can just pull out what you want and keep the other fresh for an extended period of time,” Markenson
Shoppers are also getting more creative with their seafood purchases.
“Instead of [simply] having a salmon meal, it may be a stir fry with shrimp and rice,” he said. “They are spreading their food dollars.”
Americans still like seafood because they believe it healthier for them, more sustainable than other proteins, packs a protein punch, and is fun to cook at home, Hartman Group CEO Laurie Demeritt said.
“Even though seafood is thought of by consumers as more expensive, they might try a less-expensive part of the fish or buy another fish,” she said.
To save money, consumers are shopping more at value retailers, spending less on non-food purchases, canceling subscriptions such as streaming services, and switching to store brands to manage higher food costs, research from Circana found. A majority of consumers – 78 percent – plan to or already have cut overall spending on products due to inflation, and 75 percent of those report that their reason for cutting spending is higher food costs.
“Consumers need to eat no matter what and will adapt to higher food costs by finding lower-cost options or cutting back on discretionary spending, and that’s what we’re seeing play out now,” Circana Food and Beverage Industry Analyst Darren Seifer said.
A considerable portion of younger shoppers are also willing to buy the best-quality items regardless of price, according to Demeritt – 52 percent of millennials and 42 percent of Generation Z, compared to just 22 percent of Baby Boomers.
When it comes to price increases on a product they planned to purchase, 27 percent of U.S. shoppers surveyed said are willing to pay a higher price, and 61 percent said they would take additional action to get the food they want, including going to another store, according to Demeritt.
Across all income levels and demographics, more consumers – 41 percent total – are purchasing private-label brands, according to the 2023 Grocery Shopper Trends report. Sixty-three percent of those surveyed said they consider private-label brands to be a good value, but just 25 percent said higher prices have led them to purchase private-label products. Nearly 77 percent who are already purchasing private brands expect to purchase more of them in the future, FMI Vice President of Industry Relations Doug Baker said.
“Thanks to increased investment, private brands are more competitive when it comes to taste and quality,” Baker said, adding that “overall value” is still the top selling point for those products.
Low-income shoppers are more likely to buy private-label brands, according to the survey. They also buy fewer items overall and less fresh produce. Demeritt said low-income shoppers are more apt to view their diet and health as lower quality than other Americans, she said, though “they still aspire to eat well.”
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