It is fascinating to compare and contrast the surge in grocery sales seen in March and April 2020 with current market realities. With less than a month in the current fiscal year, we now have a better evidence-based understanding of whether predictions of sustainable behavioral change have had an impact. In other words, is there a "new normal" in the Australian grocery store in 2021 (and beyond)?
IRI publishes its report “Grocery Market Update 2021” in the July issue of Retail World.
Dynamic shifts in performance narrative
The market analysis for packaged groceries at the point of sale (scan) by IRI showed an increase in the YOY dollar of 9.4 percent in the 52 weeks up to March 21st. The number of items rose by almost five percent, with the Australians paying an average of 4.3 percent more for each packaged item scanned at the checkout. Nevertheless, signals of normalization materialized in the final quarter of 2020, when sales growth slowed to 5.9 percent and sales growth fell below three percent.
If you roll the scan data to another quarter (up to 04/04/21), a completely different scenario emerges. The value of the packaged food market fell 5.5 percent and sales fell 8.0 percent. Nearly two-thirds (64 percent) of the packaged food categories declined this final quarter, compared to a quarter of the categories for the entire 52 weeks. The industry would never repeat the explosive sales of the March 2020 quarter. But the negative growth scenario would be even more gloomy had it not been for an earlier and comparably strong Easter trading performance in 2021 compared to the previous year.
Read the report “IRI 2021 Grocery Market Update” in the July issue of Retail World.