Dive Brief:
- Only a small fraction of grocery shoppers believe their primary store offers low prices compared with other stores, with just 13% of consumers who regularly shop at traditional supermarkets feeling that way, according to survey data released last week by management consulting firm AlixPartners.
- Shoppers are showing increasing disdain for the “high-low” pricing strategy many traditional grocers depend on, indicating that the everyday pricing model employed by mass retailers such as Walmart is a more effective way of demonstrating value to consumers, the survey found.
- Traditional grocers are relying too heavily on promotions to connect with shoppers, creating unfavorable comparisons with other channels, said John Clear, a partner at AlixPartners.
Dive Insight:
While traditional grocers have long made a practice of highlighting low prices to attract and retain shoppers, that strategy has become obsolete at a time when consumers have broad exposure to other retailers that make it easier for them to see what items actually cost, according to the research.
“There is an element of consumer trust being eroded because they don't know that they’re getting the best price at any moment,” Clear said in an interview.
Nearly two-thirds of shoppers who participated in the survey said they value deals but feel it is “too much work” to capture all of the deals grocers offer.
Only about 40% of participants said they are willing to buy more of a certain product than they had intended to earn a better price, and just 30% said they will buy multiple items under the same brand to pay less per item.
In addition, only about a quarter said they would use an app to access a digital deal or shop on a particular day to access a limited-time-only sale. Meanwhile, 16% said they would join a loyalty program to get a better price, and 17% said they would clip a coupon to do so.
“If you’re only using [promotions] as a way to show your price competitiveness against somebody who has an everyday low price that’s lower than yours, it’s not really a customer-driven promotion exercise anymore,” said Clear.
Instead of luring shoppers by touting the fact that they can save money in their stores, conventional food retailers should instead turn to areas where they have stronger credibility, such as fresh quality, service and private brand, AlixPartners said. Grocers also stand to benefit by paying more attention to private labels as a way to offer unique products instead of looking to their own brands primarily as a way to increase margins, the research found.
“Our take would be that, unless your name is Walmart, Costco, BJ’s, Lidl or Aldi, the dominant theme of your marketing should not be ‘low prices,’” AlixPartners Partner and Managing Director Matt Hamory said in the report.
The research is based on a survey of 1,635 consumers AlixPartners conducted in October 2025.
