The food retail landscape is evolving rapidly, driven by shifting consumer behaviors, economic pressures, and technological advancements.
In “The Future of Food Retail” webinar recently hosted by The Food Institute, R.J. Hottovy, Head of Analytical Research at Placer.ai, unpacked the latest food retail trends and shifts in consumer behavioral patterns, as well as their potential implications for the sector’s trajectory.
From the rise of specialty grocers to the ongoing battle between the food-at-home and food-away-from-home categories, Hottovy shared invaluable insights into the forces reshaping the realm.
Superstores Supercharge Growth
According to Placer.ai data, foot traffic to grocery stores, superstores, and dollar stores increased in early 2025, with superstores seeing the strongest year-over-year growth.
These retailers have become increasingly attractive to middle-income consumers – a key demographic impacting the market.
“Certainly, consumers are looking for value, but they’re also looking for newness,” Hottovy explained. “Retailers that combine the two – like Trader Joe’s – are winning.”
While traditional grocery stores struggled to keep pace, value grocery and specialty formats remained strong, as shoppers have continued to stretch their budgets while simultaneously seeking out both high-quality and innovative products.
Shop ‘til You Drop
Instead of relying on a single grocery store for their weekly haul, U.S. consumers have also been increasingly visiting multiple stores in search of deals, discounts, and specialty items.
This trend solidified in 2024 and has carried over into 2025 as well.
“They know where the deals are now,” Hottovy said.
“It’s going to take something extra – a unique product or a strong promotion – to convince them to add a new store to their routine.”
Some Like It Hot
Another standout trend? The rise of grocery chains with hot bars – a strategy that has proven to be successful for retailers like H Mart as of late.
“Grocery stores with hot bars are becoming dining destinations in their own right,” said Hottovy.
These prepared food sections have been increasingly competing with quick-service restaurants – particularly during the lunch hour – largely due to their ability to blend value and convenience with unique culinary experiences.
More shoppers are now grabbing lunch from grocery stores instead of eating out, which has further blurred the line between the foodservice and food retail sectors.
Join the Club
In addition, wholesale membership clubs have been outpacing traditional grocery stores by offering bulk savings that resonate with consumers who are continuing to grapple with inflation and increased food costs.
Retailers like Costco Wholesale, Sam’s Club, and BJ’s Wholesale have been giving standard grocery stores such as Walmart and Target a run for their money through exclusive deals and products that keep price-sensitive shoppers coming back for seconds.
See Ya at the C-Store
Meanwhile, convenience chains are no longer just pit stops – they’ve transformed themselves into full-fledged food destinations.
Brands like Buc-ee’s, Wawa, and Sheetz have experienced strong visitation growth through expanded food programs and innovative store formats.
“This is a category that’s quietly disrupting the food retail space,” Hottovy observed.
“With competitive pricing and quality offerings, convenience stores are attracting more meal-time visits than ever before.”
Innovation Meets Value
As for the future, Hottovy emphasized that maintaining a sole focus on value won’t cut it; retailers must also offer innovation to customers to secure lasting success within the food retail space.
Whether through unique private-label offerings, better-for-you products, or global flavors, the most successful brands will be the ones who can figure out how to hook shoppers and keep them engaged.
“If I leave you with nothing else, it’s that 2025 could be another up-and-down year,” Hottovy concluded. “But value and innovation – especially specialization – are key messages for anybody in the food retail sector.”
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