Intensified Competition and Customer Vigilance
The dunnhumby Quarterly: January 2024
The fifth edition of The dunnhumby Quarterly
Every quarter, we help grocery retailers gain insights into the market by analyzing economic trends, customer needs, and competitive positioning of the top 60 to 70 retailers in the US grocery market. The final quarter of 2023 was dominated by news about the increasing use of genAI, the consumer price perception gap, and personalization. As we move into a new year, this edition of the dunnhumby Quarterly will delve deeper into the competitive landscape and how grocers can stay ahead by addressing the needs of the ever-vigilant consumer.
WHO IS WINNING AND WHY
Seventh annual Retailer Preference Index (RPI) for U.S. Grocery
dunnhumby’s Retailer Preference Index (RPI) has been helping U.S. retailers and brands since 2017, by gathering insights from over 10,000 U.S. shoppers annually. The data collected helps us understand what matters most to customers when shopping at 60+ grocery retailers, and identify which retailers are well-positioned to thrive in normal and turbulent market conditions. The latest RPI, provides valuable insights to win customer preference, especially in light of the projected increase in competition in 2024. Economists predict that grocery market sales growth this year will only be between 0.5% to 1.5%, the slowest since the Great Recession of 2009.
The RPI approach is unique in that it uses a blend of financial performance and customer perception to measure Customer Preference, making it more accurate and reliable than other rankings. The report not only identifies top-performing retailers but also provides actionable insights for those who want to improve their competitive position.
WHAT CONSUMER TRENDS TO KEEP AN EYE ON
Consumer Trends Tracker
Our Consumer Trends Tracker (CTT) survey helps understand how consumers perceive inflation and its impact on their behavior. According to the results of a recent survey, consumers have been overestimating inflation at home for more than a year. In November, the perceived rate of food-at-home inflation was 22.0%, whereas the actual inflation dropped to 1.7%. The study also highlights that inflation does not have a uniform impact and shopping behavior varies significantly based on demographics, geography, and product categories.