SNAP households represent 24% of U.S. consumer goods spend

SNAP recipients represent a diverse group of consumers. 61% of SNAP recipients are in the bottom 30th percentile in terms of purchasing power, 45% have children (compared to 28% of non-SNAP households), 29% have 5 members in their household, and 37% are Gen Z or Millennial. Compared to non-SNAP households, SNAP households are twice as likely to be Black/African-American or Hispanic/Latino. 

Economic uncertainty affects SNAP households more severely. 79% say their financial situation is the same or better compared to the prior year, but 1 in 5 SNAP households say they are overwhelmed with financial burdens and 56% are concerned about job stability (compared to 31% of non-SNAP recipients). 

Even with government assistance, SNAP recipients feel food insecurity. Over 1 in 4 SNAP consumers (26%) say they are unable to buy enough food to feed their family. 

Health issues and healthcare costs are significant concerns. SNAP consumers are 3.8x more likely to be disabled, and they are 56% more likely to be not actively managing their health, compared to non-SNAP consumers.

Utilization of SNAP during a shopping trip results in larger purchases.When SNAP consumers utilize their benefits during a shopping trip, basket size is $15 more, spend per trip on groceries is almost $18 more, and units per trip double (from 5.2 to 10.4).

SNAP recipients are disproportionately spending more per unit. In the latest quarter ending 12/31/2022 compared to YA, SNAP consumers are paying 13% more per unit, compared to 11% more for non-SNAP consumers – driven by increased inflation on baby and health & beauty products that SNAP consumers over-index on, as well as in the Dollar channel.

To save money, SNAP recipients are pulling back on snacks. Units purchased per household are down significantly in snack categories such as popcorn (-23.6% vs YA), meat snacks (-18%), and snack seeds, nuts & trail mixes (-15.9%).

Trading down to private label helps to reduce the sting of inflation.Although unit sales are down, Walmart, Aldi and Kirkland private labels are outperforming branded CPG. For example, Great Value unit sales are down 4% vs YA, compared to branded unit sales dropping 20%.

Affordable luxuries like personal care items have not seen a pullback on spending. Categories such as toothbrushes ( 6.3% units per household vs YA), beer ( 4.6%) and face makeup (-0.5%) are holding their own or growing with SNAP consumers.

SNAP consumers vary their shopping locations. SNAP consumers are 56% more likely to spend their CPG dollars at Dollar stores, 24% more likely at Convenience stores, and 12% more likely at Mass retailers (compared to non-SNAP consumers). 

Regional and ethnic grocery stores are winning SNAP household trips because of their lower price increases. Among the retailers growing trips with SNAP households are H-Mart (42% of projected trips), Market Basket (42%), Whole Foods Market (36%), 99 Ranch Market (35%), and Wegmans (31%). 

SNAP consumers are 37% more likely to eat out four or more times per week, but they are moving food trips back to stores. As SNAP recipients pull back on dining out, Starbucks, KFC, Burger King and Little Caesars are seeing the most lost trips.

More inclusive grocery delivery services would benefit consumers and retailers. 20% of SNAP recipients say they wish that grocery delivery services made it easier to utilize their program benefits. Currently, 12.9% of SNAP consumers use Walmart , followed by DoorDash DashPass (5%), and Albertsons Freshpass (4.3%).