Survey: Physical stores still dominate U.S. grocery
Discount stores and traditional supermarkets are U.S. shoppers' most popular choices when it comes to buying food. At least for the time being.
Nearly all — 99% — of adults buy some or all of their groceries in-person, according to a survey by the International Council of Shopping Centers. The immediate access to products (71%) and the ability to select fresh meat, dairy and produce (70%) were the top reasons driving in-store shopping, along with the ability to see all other items in person (69%).
The survey round that consumers on average shop at 5.4 different types of grocery retailers, with 93% of people patronizing discount department stores (e.g., Walmart and Target) and 92% shopping at traditional supermarkets for grocery purchases, according to a new survey by the International Council of Shopping Centers. Sixty-nine percent of consumers shop at limited assortment food stores (e.g. Aldi and Trader Joe’s) and at warehouse clubs.
Traditional supermarkets have the most frequent visitors, with 55% making purchases at least once per week. The largest shares of infrequent shoppers buy occasionally (every few months) from small, specialty/gourmet food stores (76%) and high-end supermarkets (65%).
The study revealed that millennials have different grocery shopping behaviors, with a much higher number buying groceries from convenience stores (74%), Amazon/other pure online retailers (67%) and high-end supermarkets (66%). Even when buying online, 81% of millennials go to the store to pick-up their grocery order.
"Millennials have been called the foodie generation and blend that with their command of technology and we see some changes in grocery purchasing behaviors, which will drive all grocery retailers to make appropriate modifications in their business model to address the way they shop,” said Tom McGee, president and CEO of ICSC. “The grocery retailer who wins their share of wallet is the one who delivers an omnichannel experience that meets their desires and demands.”
In other survey findings:
- More than four out of 10 consumers (44%) have their grocery purchases delivered to their home and over one-third (36%) have items shipped by mail or courier service to their home.
- Fifty-four percent of high-end supermarket shoppers who buy online have the retailer deliver the groceries to their home — the highest of any type of online grocery shopper.
Report: ‘Mall mix must change’
Three-quarters of gross leasable area in American malls are inhabited by stores representing the slowest-growing retail categories.
That’s the basis of a report from CBRE advising mall owners to seriously consider diversifying their tenant mixes. Department stores sales are declining by around 4%, yet they take up 49% of mall space. Apparel stores that form 30% of mall makeup are growing at a 12%, but that’s well below restaurants at 32% and furniture, personal care, and health care stores at above 20%.
“The American mall itself isn’t anywhere close to dead; It’s the old mall model that is dying,” said Melina Cordero, CBRE’s head of retail research for the Americas. “It is a necessary evolution for the mall industry to maintain its place as a cornerstone of American retail.”
That means more restaurants and entertainment centers, concludes CBRE. Super-regional malls that have been able to convert more department store and out-parcel GLA to those categories have seen net operating incomes rise from about $5.50 per square foot in 2013 to more than $9 in 2016. Regional malls stayed flat at approximately $5.50 over the same period.
Even with the super-regionals aggressively altering their mixes, restaurants account for only 4.6% of GLA at American malls. Home furnishings, health care, and personal care stores inhabit less than 2%.
Online giant to open machine learning hub in Barcelona
Amazon is stepping up its commitment to machine learning.
The online giant plans to open a new research and development (R&D) hub in Barcelona, dedicated to machine learning. Amazon expects to open the lab in early 2018, according to The Verge.
Amazon plans to hire more than 100 engineers and scientists for the lab.
The R&D hub will be housed in the same building as the company’s recently announced Amazon Seller Support Hub. Scheduled to open around the same time, the support hub will help small online companies from Southern Europe sell on Amazon Marketplace, The Verge reported.
The news comes on the heels of Amazon’s plan to open a new North American headquarters. Amazon is accepting proposals from interested North American cities through Oct. 19. The company will announce its decision next year.
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