Cardlytics State of Spend 10: Will Grocery’s Growth Continue?

Happy Thanksgiving week! We’ve officially made it to the holidays and in 2020 that is something to celebrate. As with everything else this year, the holiday season is looking a lot different than in previous years. With COVID surging again in much of the country, retailers in all industries are buckling in for what is sure to be a holiday season unlike any other. In this week’s State of Spend, we look at:

• Where we’re seeing changes in spend.
• What Thanksgiving in a pandemic means for Grocery.
• How a national grocery chain has doubled down on loyalty

Overall Spend

_{*All data referenced is for the week of Oct. 29 through Nov. 4., unless otherwise indicated.*}

Overall spend grew week-over-week (WoW) but was still down -4.7% vs last year, a good bit lower than what we’ve seen in recent weeks. We will keep an eye on next week’s spend to determine if this week is an anomaly or the beginning of another downward trend.

Our Recovery Leading Indicator (RLI) tracks spend in select discretionary categories to help brands measure consumer confidence throughout the recovery. It compares weekly spend in categories such as Salons, Apparel Retailers, Casual Dining and QSR restaurants, among others. For the week of Oct. 29, the RLI is down -19.3% YoY, the worst we’ve seen since late August.

As you might expect, states with the highest rates of positive COVID cases (Illinois, Colorado, North Dakota, among others) that are starting to put controls back in place tend to have the most regression in RLI since September.

Grocery

With Thanksgiving this week, we can expect to see an uptick in grocery spend as more than 70% of Americans say they plan to maintain or increase spend compared to last year. For now, Grocery spend remains strong leading into the holidays, up 8% YoY for the week of Oct. 29.  

The average number of in-store grocery brands customers shopped declined once lockdowns started. However, throughout the summer into the end of October, shoppers have steadily added more in-store grocery brands. Additionally, their basket size remains high, yet they are making fewer trips, which is driving YoY sales spikes.  While we aren’t yet seeing the large-scale stocking-up that occurred back in the Spring, retailers are beginning to see pantry loading for specific items.  We will continue to monitor over the coming weeks to determine the impact of updated guidelines for travel and indoor gatherings on overall spend.

Trends we’re watching

• How is another surge in COVID cases impacting overall spend?
• Will traditional behaviors (i.e. in-store shopping) prevail during the traditional holiday season?
• As some areas begin increasing restrictions due to virus upticks, will stocking up start again in grocery and retail?
• What will more, yet smaller, Thanksgiving gatherings do to Grocery spend as households celebrate independently?
• Will colder weather freeze restaurant spending as diners no can longer eat outside?
• Is an uptick in apparel and shoes a sign of an earlier than usual holiday shopping season?

With an advertising platform that reaches nearly 160 million bank customers, Cardlytics can help marketers create targeted campaigns that help answer: 

• When & where are customers starting to make in-store purchases?

• How quickly am I gaining or losing share vs. my industry?

• How is my eCommerce channel performing against my category?

• Are my newly acquired customers likely to churn?

Whether marketers are experiencing ups or downs in consumer spend, Cardlytics is focused on helping our clients navigate the times and drive measurable sales. Contact us today for an analysis and a campaign strategy customized for your brand.