Global trends according to IGD

Grocery shopping and supply chains. Illustration by Berit Sømme
Illustration: Berit Sømme for Food/NHH
By Reidar Molthe

31 January 2023 09:47

Global trends according to IGD

With inflation driving significant increases in production costs and retail prices across most major markets IGD emphasize that there will be a concentrated focus from retailers and suppliers on driving out costs and improving the efficiency of supply chains.

IGD has a good reputation and many advanced analyses. That is excellent, but the development in the UK right now (and many other markets) is that Lidl and Aldi, German discount chains are taking market shares from supermarkets.

Regardless of analyses and trends, price is still the single most important parameter in the grocery sector.

“While many cost cutting initiatives from businesses have been reactionary, they are helping retailers to reset the cost base and develop go-to-market models for the future,” argues Toby Pickard, Global Insight Leader at IGD.

Pickard and IGD argues there at six main trends that will influence competitiveness for grocery chains in the future.

1. Efficiency

With cost pressures mounting and retailers having to strip out complexity from their businesses, efficiency is a priority. Technology, automation, collaboration, new ways of working and a fresh approach to marketing all have a role to play. But caution is needed as some cost-cutting initiatives are at the expense of the shopper experience.

2. Value and price

Value is not synonymous with price. Both brands and retailers need to factor in a broader set of variables when trying to create value for shoppers. Other factors like experience, rewards, time and doing the right thing can move the narrative beyond price alone. Probably the most difficult task for supermarkets in an environment where discount stores take market shares in disturbing speed in all markets.

3. Interesting stores

Retailers must delight and surprise their shoppers. But this does not mean by theatre and entertainment alone. Time, convenience, checkout, value and range are areas that can be optimised, in-store and online.
A its best the consumer gets more than expected. He or she will be pleasantly surprised.

4. Wellbeing & health

Interest in improving health stays elevated, and the grocery industry’s remit and responsibility continues to grow. Building trust and making healthy choices affordable and appealing have potential for great positive change. Meaningful progress in 2023 would lay the foundations for future generations’ health.

5. Environment

Today, the environment is a necessity, not a competitive factor. Nevertheless, it is important to show that you take the environment seriously in practice, IGD believes. Retailers will be forced to make tough decisions between environment and cost implications.

6. Innovative technology

Retailers have unprecedented access to innovative technologies, enabling them to operate faster, more efficiently and at lower cost. However, it must be used in a way that consumers understand. If not, it will not work.

This is IGD

British IGD is a member-based consultancy and a lobby organization for the grocery industry in Great Britain.

Many believe, including the undersigned, that IGD is among the better analysts in the industry – both at European and global level.

IGD organizes several interesting conferences and seminars in London each year.

Sources: IGD, Namnews.

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