Inflation concerns peaked (ACI)
The average nationwide gasoline price has fallen 10% since the peak on June 13. The peak in gasoline prices coincides with the peak of inflation concerns as measured by Civic Science’s survey. Our macro team is calling for disinflation, not deflation. The inflation rate for food looks to decelerate in the coming months, but it will stay elevated putting further strain on household budgets. The level of concern may have peaked, but spending behavior changes most likely have not.
Exclusive online grocery shoppers decline (KR)
According to a survey from ChaseDesign, a category growth design firm, the demand for buy-online-pick-up-in-store (BOPIS) grocery shopping appears to be down trending. Key callouts from the survey include: Consumers that said they are exclusive BOPIS customers fell from 45% in 2020 to 32% last year. Consumers who said they exclusively use home delivery fell from 31% in 2021 to 16% in 2022. 42% of consumers who buy online and pick up in-store purchase additional items compared to 32% who pick up curbside. Online grocery shoppers tend to avoid categories like meat, seafood, produce, bakery, and dairy, saying they prefer to pick the items themselves. Roughly one-third of shoppers said they have issues with the quality of items selected for them. Walmart had the best online grocery shopping experience according to the survey, followed by Target, Costco, and Whole Foods.
Even though the pool of dedicated online grocery shoppers is shrinking the investment to remain in the category continues to increase. Uber Eats is introducing a new grocery experience in select cities this week. Customers will be able to place orders from grocery stores after hours, schedule deliveries, track their orders select product replacements, and shop for items by weight.
Tasting room sales decelerate (NAPA, VWE)
For the 450 wineries across California, Oregon, and Washington in Community Benchmark’s index, wine club sales for the first half of 2022 increased 11.0% YOY. Tasting room sales for the first half of 2022 increased 21.9% YOY. Combined DTC sales increased 9.7% in the first half of 2022. Even though the comparisons are more difficult for tasting room sales as we lap California’s full economic reopening in June 2021, the on-premise channel is the driver of industry sales in 2022.
