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Grocery
Quarterly Index
2022: Q1

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The grocery sector had an exceptionally strong year in 2021, but the challenges of the past months somewhat impeded growth. Following three straight quarters of quarter-over-quarter visit increases, foot traffic to grocery stores nationwide fell in Q1 2022, dropping 8.6% when compared to Q4 2021. Still, visits were up 4.6% compared to Q1 2021 and up 1.1% compared to Q1 2019. So despite the combined challenges of Omicron, inflation, and rising gas prices, the offline grocery category is still ahead of where it was both last year and pre-pandemic. 

Analyzing dozens of brands including:

Decrease in Average Visits per Venue

Overall, foot traffic increased, but on a visit per venue level visits decreased – which means that much of grocery’s strength in Q1 came from expansions. Several national chains expanded rapidly, and more stores led to more overall visits, even if some individual locations saw reduced growth. And since grocery visits per venue matched or exceeded 2019 levels throughout most of 2021, and only fell over the past months, there is likely more than enough demand to fill the new venues. The drop in visits per venue in Q1 is likely just a temporary consequence of the current economic context. 

 

“Overall, foot traffic increased, but on a visit/venue per venue level, it decreased, showing that much of grocery’s strength in Q1 came from expansions”

-4.4%
Nationwide grocery visits per venue are down 4.4% Yo3Y

Strong Start, Slow Finish

The grocery category started off 2022 strong, with weekly visit growth on both a YoY and Yo3Y basis. The spread of Omicron did not put people off from hitting the grocery store. But in the second half of the quarter, the general downturn in consumer spending seems to have had an impact: Yo3Y weekly visits have generally been down since mid-February, reaching a low of 6.6% fewer visits the week of March 28th compared to the equivalent week in 2021. Rising costs – especially rising gas prices – appears to have made its impact here.

“The general downturn in consumer spending seems to have had an impact in the second half of the quarter.”

-6.6%
Grocery visits down by 6.6% YoY for the week of 3/28/22

Shorter Grocery Runs

Visit duration didn’t change much in the second half of 2021, but during this past quarter, the median visit length fell by 1.9% relative to Q4 2021. And the QoQ change was accompanied by a YoY change of -4.4%. This data reveals that the days of mission-driven shopping are most definitely over. Now, instead of staying in the store longer than usual to stock up on more groceries during each visit, inflation may be pushing some consumers to fill smaller baskets that take less time to fill. This could further explain the QoQ drop in median visit length.

"The median visit length fell by 1.9% in Q1 relative to Q4 2021 following two quarters of overall stability in visit duration."

-4.4%
Median grocery visit 4.4% shorter YoY

Grocery Growth Leaders

Despite the challenges, several grocers – including Publix, Trader Joe’s, and Aldi – succeeded in exceeding their 2019 visit numbers every quarter for the past four quarters. These fast growing grocery chains also opened the most new stores, showing that despite the rise in popularity of online grocery shopping in recent years, there is still plenty of room for growth in the brick and mortar grocery space.

“Despite the rise in popularity of online grocery shopping in recent years, there is still plenty of room for growth in the brick and mortar grocery space.”

10.5%
Yo3Y visits to Aldi were up 10.5% relative to Q1 2019

Summary

The grocery surge of the 2021 seems to have abated, but the sector’s strength over the past year has given the brick and mortar grocery a long term boost. Overall visits are still up nationwide on a YoY and Yo3Y basis, and several grocery chains are up by double digits compared to pre-pandemic 2019. Still, the drop in foot traffic over the second half of the quarter indicates that while the grocery sector may be relatively immune to COVID surges, foot traffic is still affected by the wider retail context. 

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