Thanks for Visiting!

Register for free to get the full story.

Sign Up
Already have a Placer.ai account? Log In

Grocery Update: A Regional Analysis of Inflation and Foot Traffic

by 
R.J. Hottovy
 on 
July 26, 2022
Grocery Update: A Regional Analysis of Inflation and Foot Traffic

As inflation spiked in the first half of 2022, grocery shoppers nationwide felt the pinch at the checkout. We conducted a regional analysis of grocery foot traffic data to examine the effect inflation is having in various markets and recapped Q2 2022 visit data for the category as a whole to offer a forecast for the coming months. 

Soaring Inflation: A Regional Grocery Analysis

Inflation remains at the forefront of retail news, with the consumer price index (CPI) jumping 9.1% in June – representing the highest level in almost 40 years. We took a look at the food-at-home CPI (a proxy for grocery store prices) and regional grocery visit data to see if we could identify how rising prices are affecting foot traffic trends. 

We reviewed food-at-home CPI data for 10 major markets from January 2022 through June 2022 and compared these figures to year-over-year (YoY) grocery store visitation data over the same period. While food-at-home inflation has somewhat influenced grocery store visitation trends across most markets, the magnitude of that inflation doesn't appear to be a strong indication of grocery store visits: The data shows that grocery visits are decreasing as food-at-home CPI is increasing, but the impact of the increase in food-at-home prices is not consistent across regions. 

For example, food-at-home inflation in Atlanta is running slightly below the national average in June – 11.0% versus the national average of 12.2% – yet visit data shows a YoY decline of 4.6% compared to the moderate 2.0% average decline nationally. Other markets such as San Francisco and Los Angeles saw YoY visit growth even as food-at-home CPI climbed above the national average, indicating other factors beyond prices – perhaps the high cost of eating out in these markets– are at play. 

While many of these markets saw a dip in YoY visits in June, we don’t expect inflation to ultimately dictate the sector’s foot traffic performance. As mentioned, our analysis showed YoY growth for grocery in Q2 2022 and we expect that trend to continue as consumers look to save money by eating at home. 

Consumers Turn to Value-Oriented Grocery Retailers

Analysis of visit data in regional markets shows that inflation is perpetuating a consumer trade-down to value-oriented grocers. While June YoY grocery store visitation trends declined in nearly all of the markets we looked at, some value-oriented grocery chains – brands such as Aldi, Lidl, Walmart Neighborhood Market, Save-A-Lot, and Grocery Outlet Bargain Market – have successfully increased their foot traffic. 

For example, visit data in June for Walmart Neighborhood Market shows 18.6% YoY growth in Seattle, 13.5.% YoY growth in Chicago, and 8.9% YoY growth in Houston. Grocery Outlet shows YoY growth of 36.9% in Philadelphia, 10.3% in San Francisco, and 8.1% in Los Angeles. These numbers demonstrate a significant opportunity for the value-oriented segment of the grocery category if the nation’s inflation woes continue. 

Grocery Still Ahead of 2019 Visit Numbers

Despite the challenges posed by inflation, foot traffic data shows that grocery visits rose in Q2 2022 on a quarter-over-quarter (QoQ) as well as year-over-three-year (Yo3Y) and YoY basis. So while the current inflation may be bringing grocery visits down from their pandemic peaks, the sector is still ahead of where it was in 2019. The continued strength of grocery is a testament to the long-term benefits of the COVID grocery boom and to shoppers’ current value-orientation which could be leading some consumers to choose home-cooked meals over eating out.

The Recap

Though some markets saw a dive in YoY foot traffic in June, our grocery sector visit data showed continued Yo3Y growth in Q2 2022. We expect to see continued positive foot traffic numbers, especially when compared to pre-pandemic data, as consumers turn away from eating out to the more cost-effective approach of home-cooked meals. 

Notably, consumers are turning to value-oriented grocers as a result of rising prices. These brands likely have the greatest potential for growth in the coming months. 

For more data-driven retail and CRE insights, sign up for our weekly newsletter.  

Get 3 brand & industry
breakdowns every week

Subscribe to the newsletter

Great! Prepare your inbox for data-driven insights...
Oops! Something went wrong while submitting the form.

Get a Demo

Please enter your first name
Please enter your last name
Please provide a valid email
Please enter your email
Please enter company name

Thanks for reaching out!

One of our experts will be in touch soon

Try Placer.ai Free
Oops! Something went wrong while submitting the form.
Placer.ai Office Index: January 2023 Recap
Focusing On Fitness: Q4 and January Recap
Placer.ai Mall Index: January 2023 – Returning Mall Normalcy?
Location Intelligence Insights Into Concert Attendance
Winning Dining Strategies for 2023
In-N-Out Burger: What to Expect as the Brand Moves East
Location Intelligence Breakdown: Coffee Caps-Off 2022
Digitally Native Brands Lean Into Brick & Mortar
Washington, D.C. Population Changes & Migration Trends
A Location Intelligence Perspective on Macy’s Rightsizing
Amazon-Powered Shopping: The Future of Brick-and-Mortar Grocery?
Cold Weather, Hot Visits: Diving into Winter Resorts
Wawa and 7-Eleven: Leaning Into the “Slurpee Effect”
2022 and Beyond: Catching Up With McDonald’s & Chipotle
Let’s Have Some Fun! Going Out Is In
Placer.ai’s Q4 2022 Quarterly Index
Placer.ai Adds Industry Executives to Leadership Team To Drive Company's Next Phase of Growth
5 Emerging Retail Formats: 2023’s Brick-and-Mortar Evolution
Grocery Update: Zooming in on the Lone Star State
2022 Office Recap: The Year of the TGIF Work Week
What Lies Ahead for Brick-and-Mortar Luxury in 2023
Placer.ai Mall Indexes: December 2022 Recap
Looking Back on 2022’s Holiday Shopping Season
Post-Pandemic Migration Trends in New York
Top Retailers for 2023
The Live Sports Advertising Opportunity
Domestic Migration to the Mountain States: Small Shifts with Big Implications
New Year, New Food: 5 Dining Trends For 2023
Announcing Placer.ai’s COVID RECOVERY DASHBOARD
This is Why Shop-in-Shops Are Everywhere
Super Saturday 2022 Recap
The San Francisco Shift
Grocery Year-End Update: Publix in the Spotlight
Three Ways Retailers Can Think Small to Increase Store Impact
Offline Beauty Is on an Upswing
The Evolving Migration Patterns of New York’s Florida Snowbirds
Placer.ai Office Index: November 2022 Recap
How Viral Social Media Trends Can Drive Offline Engagement
Are You Ready for Some Football? Experiential Marketing Shows Promise
Mall and Shopping Center Trends For 2023
Retail Corridors and Indoor Malls: A Holiday Head-to-Head
Placer Bytes: Nike, lululemon, and GameStop Update
Placer.ai Mall Indexes: November 2022 Update
Black Friday 2022: Consumers Hear the Call
Digitally Native Brands: Taking Off, Offline
Discount and Dollar Stores Leading the Pack
Turkey Wednesday 2022
Retail’s Evolving Holiday Season
Placer Bytes: Starbucks and Department Stores Ahead of Black Friday
Ulta: A Force to be Reckoned With
College Towns Drive Dining Growth
Foot Traffic Trends Reveal Consumers Ready for Holiday Cheer
How Retailers Can Win Big By Going Small
How Are Consumers Feeling Ahead of Black Friday 2022?
Off-Price, Hibbett, and Dick’s Pre-Holiday Check-in
Ho, Ho, Wholesale: Costco, Sam’s Club, and BJ’s
October 2022’s Retail Rebound
Target and Walmart Ahead of the Holidays
Home Improvement: Leave it to the Pros
Despite Inflation, Holiday Season is Off to a Good Start
Placer.ai Office Index: October 2022 Recap
Placer.ai Mall Indexes- October 2022 Update
Americans Double Down on Fitness
The State of Grocery
CVS and Walgreens: The Wave Continues
Coffee Chains Brewing Up Visits
Placer.ai Spotlight: Pizza Players
What Drove COVID-Era Urban Migration Trends?
Kroger and Albertsons: A Merging of Strengths
Texas Roadhouse Innovations Dishing Up Success
Holidays on the Horizon: Mid-Range and Luxury Shopping
McDonald's and Chipotle's Post-Pandemic Success
Announcing Placer.ai’s Q3 2022 Quarterly Index
5 Hot Restaurant Brands for 2023
Target Finds a Winning Deals Day Formula
Five Trends to Watch for 2022’s Holiday Shopping Season
September 2022 Analysis: A Difficult Month and Time for Optimism
Inflation’s Retail Winners
Five Apparel Retailers to Watch Ahead of the Holidays
Placer.ai Spotlight: Wawa’s QSR Pivot
Placer.ai Mall Indexes: September 2022 Recap
Placer.ai Office Indexes: September 2022 Recap
The Impact of Population Growth on Commercial Real Estate 
Starbucks' New Makeover
There's Somethin' About Pumpkin
Expanding Offline Reach
Breakfast Restaurants are Rising in Popularity
The Power of Labor Day 2022
Tourism in Miami Heating Up
Citi Trends on the Rise
Reaching Rural Consumers Through Retail Media Network
Darden Restaurants Cooking Up Success
The Home Improvement Sector: A Sign of Consumer Confidence
QSR Is Having a Northeastern Growth Spurt
Domestic Migration’s Ripple Effects
A Look Back at Back To School 2022
Kroger Digital Tell-All
The Return of In-Person Networking
The Reinvention of the American Mall  
Placer.ai Office Building Indexes: August 2022 Recap