Food Gifting Popularity Can Offer Supermarkets More Holiday Share

Halloween hangovers and a focus on the upcoming presidential election will not deter Americans from getting started on their holiday preparations this month. Though the election will reportedly make shoppers more conservative this holiday season, grocery retailers will still have plenty of opportunities to inspire and cultivate strong sales now through the end of the year.

Close to half of consumers (41 percent) began their holiday shopping in October, according to the National Retail Federation’s annual consumer spending survey, conducted by Prosper Insights & Analytics. The same percentage said they will start seasonal shopping in November and 18 percent will wait until December.

This year, total planned spending—which includes gifts for others, self-spending, food, flowers, decorations, and greeting cards for Christmas, Hanukkah and Kwanzaa—is second only to the record total spending in 2015, at $952.58. According to the survey, consumers say they will spend $588.90 on gifts for others and $207.07 for items such as food, decorations, flowers and greeting cards this year.

While a majority of shoppers will focus on three destinations (department stores, online and discount stores), supermarket retailers can expect to get a share of the seasonal action. The survey found 45 percent plan to visit a grocery store/supermarket.

Gift cards ranked as the most popular gifts sought by 61 percent of those surveyed. With nearly half of consumers planning a trip to the supermarket this season, retailers would be wise to maintain a clean, well-stocked gift card selection at supermarket checkouts. Gift card holders and cards will complement the area and likely inspire impulse sales for last minute shoppers already in stores to check items off their holiday meal planning grocery lists.

Clothing, accessories, books, CDs, DVDs, videos, consumer electronics, jewelry, home décor, personal care or beauty items, sporting goods and home improvement items were also popular gift ideas among those surveyed by the National Retail Federation. Of course, supermarkets can capitalize on the popularity of gift cards and personal care and beauty items, however, there may be another gifting opportunity for retailers to take advantage of this holiday season: food gifting.

Consumers have continued to expand their usage of food gifting across occasions and food gift types, according to the Packaged Facts report Food Gifting in the U.S., 5th Edition. Packaged Facts forecasts that U.S. consumer and corporate food gifting sales will approach $18 billion in 2106, up 3.5 percent from 2015. Of this amount, the majority is contributed to consumer sales, which Packaged Facts expects to rise 2.5 percent in 2016.

While more consumers are giving food gifts on occasions other than major holidays, like graduations, birthdays or “just because,” the winter holidays are the most popular time of year for food gifting. Nearly half of those that have purchased food gifts have done so during this time of year, and 32 percent of those who have purchased food gifts for themselves have bought them during the winter holidays.

Not surprisingly, boxed chocolates/candies remain the most chosen food gift that people buy for others. Sweet baked gift foods, coffee/tea/hot chocolate gifts, and nut/salty snack gift foods are also widely purchased food gifts, according to Packaged Facts.

With 87 percent of consumers saying they could be convinced to spend an extra $25 this holiday season if tempted by a good sale or promotion, the perfect gift for themselves or others, or free shipping (according to the National Retail Federation), now might be the time for supermarket retailers to consider putting together food gift ideas to display with other seasonal items if they haven’t already done so. Becoming a one-stop shop for all consumer needs will be the gift that keeps on giving—for both retailers and shoppers—this holiday season.