In order to reflect on how the grocery world changed in 2020, we have changed how we calculate our overall Grocery RPI score. Given the historically unique metrics we've witnessed in the economy, the restaurant industry and the grocery industry, along with the rare influence a global pandemic has brought to consumer behavior, we're viewing grocery success in 2020 through a different lens than we viewed grocery success in prior years.

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The fourth annual dunnhumby Retailer Preference Index (RPI) has a new retail leader in the top spot — Amazon.

The analysts said that in a year dominated by COVID-19 and its impact on retail and consumers' lives, Amazon was able to jump the reigning top two grocers H-E-B and Trader Joe's, who slid to second and third, respectively, in the latest index. Read more.



Discounts, Rewards & Information is defined as relevancy and ease of redeeming discounts and coupons, rewards for shopping, and providing relevant Information. Like Speed, which shot up from least to most important in the Covid Era, this pillar also became much more associated with success in 2020 than in previous years – sitting behind Speed and alongside Digital.

Out of all the pillars, the increased importance of Discounts, Rewards & Information seems to be truly a Covid Era phenomenon. While Discounts, Rewards & Information was associated with some success in 2020, long-term, the more a retailer leans on Discounts, Rewards & Information instead of improving base price, the poorer positioned they tend to be for financial success. Two factors seem responsible for the increase in importance of Discounts, Rewards & Information during Covid: perceptions of higher food prices and supply chain disruptions. Customers are not only noticing a rise in the cost of food but also that deals and discounts are less frequent than they were before Covid, creating a sort of double whammy for price conscious customers. They are also noticing that when deals are available, customers swarm the items and leave empty shelves. It's about quality offers and promotions rather than quality. So, retailers who did offer accessible, easy-to-use discounts and rewards earned repeat visits from grateful customers, and tended to have more momentum in 2020.

Fareway made a notable jump on Discounts, Rewards & Information during Covid. While this helped the retailer's strong momentum score, Fareway also happens to rank first in the market in the all-important Speed pillar for the Covid Era and is above average in Operations.

Speed


For this study, speed is defined as getting in and out of the store quickly and a fast checkout. In the Covid Era, Speed became synonymous with Safety, more strongly correlated than any other driver. Shoppers wanted to avoid crowds and get in and out fast to stay away from germs. But Safety also threw unprecedented hurdles at shoppers to execute a quick shopping trip with the safety measures that stores enacted, such as one-way aisles and lines to get in the store

Furthermore, it was not uncommon that when shoppers would get in the store, some of the items they had lined up for wouldn't be there, feeling like time wasted. So, retailers who helped shoppers overcome these hurdles, save time and stay safe during Covid increased the likelihood of capturing bigger baskets and a greater share of trips during Covid. Albertson's and Raley's improved customer perceptions of Speed compared to last year. Raley's coupled their Speed gains with established Digital performance to achieve above average momentum and a move up the RPI ranking.

Speed and Covid:Voice of the customer

"One-way aisles take much longer to navigate, especially if you forget an item & have to go back or want to compare prices on items in different aisles. Also entering the store on one end & exiting it on the other creates a greater distance from where I normally park."

Convenience


Convenient locations, one-stop shopability, and right product variety make up the Convenience pillar. Convenience is the least important factor for explaining short-term market share gains, and retailers in each of the four Covid Momentum Quartiles performed similarly on Convenience.

customers favored Speed during Covid, which correlates negatively with larger format stores where customers can do all their shopping at once. Moreover, evolving commuting behaviors from people working from home and limited mobility due to stay-at-home orders shifted which stores were now considered Convenient. While people were adjusting to new ways of shopping for food, and making trade-offs on Price and product quality and variety, they were being hit with out-of-stocks, which affected their ability to easily buy their typical brands.

Despite stay-at-home orders, changes in commuting behaviors and erratic outof-stocks (or perhaps because of these things), basket sizes were up and visits per customer were down for every retailer we studied. At the time we surveyed, the average basket size was ~30% higher for shoppers in the market. Additionally, the average share of wallet that customers were giving to their current grocery retailer was ~14% higher. Translation: customers consolidated their shopping to fewer stores, giving more money to each store. This occurred even for stores that were competitively less well-positioned for one-stop-shopability heading into Covid. In fact, stores that scored in the lowest quartile on "I can do all my shopping at this one store" had the largest increases in basket size and share of wallet during Covid. In other words, during Covid, shoppers were more forgiving of a retailers' faults in their quest to fulfil their short-term shopping needs and get home quickly and safely.

Convenience and Covid: Voice of the customer

"With work at home - I cannot shop at the grocery stores I usually shop at because they are in the town where I work - 30 minutes away and feel wasteful driving that far just for groceries."