Inflation-Driven Price Hikes Vary Significantly Across 10 Popular U.S. Grocery Categories in Q1
Catalina Shopping Basket Index Reveals 3% Aggregate Price Increase, with Families, On-the-Go, and Value-Conscious Shoppers Hit Hardest
Key grocery food categories remained stubbornly high in Q1 2024 while select others dipped to new lows compared to the same period in 2023. Tapping into its rich, real-time Shopper Intelligence Platform, Catalina looked at the aggregate price increase of 10 common grocery categories in the U.S.
“Our latest data shows grocery inflation has dropped considerably from a year ago in these 10 categories," said Wesley Bean, US Chief Revenue Officer at Catalina. "While this is positive news overall, it's important to remember the impact isn't felt evenly. Value-conscious shoppers are still grappling with significant price increases on essential items, even as the broader inflation rate cools."
The 3% average Q1 inflation rate from Catalina’s data was on par with the overall 3.5% inflation rate reported in March’s US Consumer Price Index (CPI). When compared to Q1 2023, the rate of inflation fell in every category, dropping anywhere from 18% for Yogurt to 6% for Deodorants in Q1 2024.
“When we drill down to individual products within these 10 categories, we gain insights as to why shoppers say they continue to feel the impact of higher prices, even though the rate of inflation has fallen considerably from six months ago,” said Bean. “Families with children and on-the-go consumers are some of the lifestyle categories continuing to feel the pinch.”
Paying a Premium for Convenience
While inflation’s impact on the overall Cereal category in Q1 is significantly lower than Q3 2023 (+5% vs. +13%), the price of Cereal Bars rose +13%. While overall Coffee prices dipped slightly, convenience carries a premium. Catalina’s Shopping Basket Index showed only a +1% increase in Q1, with prices for Regular Coffee (-1%), Coffee Pods (-2%) and Instant Coffee (-3%) falling below the same period in 2023. However, those convenient Ready-to-Drink Single Serve Coffee Drinks posted a +3% price increase.
Value Brands Outpace Premium Brands in Price Increases
One surprising trend is that Value Brand prices are rising faster than their Premium counterparts in some categories. Catalina’s Shopper Intelligence Platform showed that key Value Brand categories continue to cost more than YAGO: Bath Tissue (+6%), Pizza (+5%) and Detergent (+2%). Premium Brand prices in the same categories dropped slightly or remained flat: Bath Tissue (-2%), Detergent (-1%) and Pizza (0%).
Price Swings Across Private Brand and Name Brand Baby Essentials
For families with children, many popular items remain well above the average +3% inflation rate for Q1 2024. These include Baby Laundry Detergent (+21%), Kid’s Frozen Dinners (+7) and Baby Wipes (+6%). Shoppers looking for price relief from Private Brands should compare categories carefully. The cost of Name Brand Baby Laundry Detergent rose +21% in Q1 2024, while Private Brand products fell -2%. During the same period, Private Brand Baby Wipe prices rose 11%, while Brand Name products increased 6%.
“Because inflation rates continue to vary by grocery category, retailers and brands have an opportunity to refine their shopper marketing strategies to attract brand switchers and remind loyal shoppers of the value of their brand,” said Bean. “Our shopper data provides the most comprehensive understanding of the shopper, enabling us to predict what and how they will buy. We are well-positioned to help brands and retailers alike find and reach the right audiences - whether they’re targeting lapsed buyers, acquiring new buyers, or enhancing relationships with loyal shoppers – and track the responsiveness of their campaigns in real-time to optimize their media spend and measure sales impact.”
About Catalina
Catalina is a leader in shopper intelligence and precisely targeted in-store, TV and digital media that personalizes the shopper journey. Powered by an unrivaled real-time shopper database and AI-optimized data science, Catalina helps retailers, CPG brands and agencies optimize every stage of media planning, execution and measurement to deliver $6.1 billion in consumer value annually. Catalina has no higher priority than ensuring the privacy and security of the data entrusted to the company and maintaining consumer trust. Catalina has operations in the United States, Costa Rica, Europe and India. To learn more, visit www.catalina.com.