Consumer Bifurcation Widens the Spending Gap (Image Credits: Pixabay)
Analysts forecast significant shifts in grocery purchasing patterns this year as health innovations, economic pressures, and emerging technologies alter consumer behavior across the food and beverage landscape.
Consumer Bifurcation Widens the Spending Gap
RBC Capital Markets identified economic divides as a dominant force in 2026 consumer markets.[1] High-income households benefit from wage growth and investment returns, while lower-income groups grapple with rising essentials costs and policy changes like U.S. SNAP funding reductions affecting 42 million people.[1]
This split pressures grocery retailers and CPG firms to tailor strategies. Premium segments hold steady for affluent shoppers, but value options dominate for others. Nik Modi, co-head of global consumer and retail research at RBC Capital Markets, emphasized the need for bold moves in such environments.[1]
Value-Seeking Drives Private Labels and At-Home Eating
Shoppers worldwide prioritize affordability, boosting private label sales as national brands lag on pricing.[1] Grocers respond with aggressive price cuts to lure budget-conscious buyers, a trend Modi highlighted in a recent Food Institute podcast.
Food-at-home consumption rises amid higher dining-out costs. Promotional sensitivity remains high, with buy-now-pay-later options for groceries climbing to 25% usage among some demographics.[1] CPG companies face margin squeezes but find opportunities in non-discretionary staples.
- Private label unit growth outpaces branded products.
- Shift from food-away-from-home, flat year-over-year after prior gains.
- Increased focus on promotions and everyday low pricing.
- Tariff impacts raise imported goods prices by up to 6%.
Agentic AI Ushers in Autonomous Shopping
Agentic AI, enabling personalized and autonomous retail interactions, emerges as a game-changer for grocery.[1][2] Data-rich platforms leverage these tools for cross-selling and dynamic recommendations, with social commerce poised to surpass $1 trillion globally by 2028.
Retailers at events like NRF 2026 showcased AI storefronts and protocols for seamless agent-driven purchases.[3] This favors large grocers with scale, potentially consolidating market power while challenging smaller players.
GLP-1 Drugs Accelerate Health-Focused Shifts
Weight-loss medications like GLP-1s intensify wellness trends, curbing impulse buys in snacks and beverages.[1][4] Analysts predict persistent headwinds for the food sector, especially among lower-income users, as adoption grows with lower costs and expanded access.[5]
Companies adapt by promoting functional foods, lean proteins like chicken, and low-alcohol options. PepsiCo tested snack price reductions to counter these dynamics.[6] Demand for high-protein items surges as consumers prioritize health.
Navigating 2026: Consolidation and Innovation Ahead
Retail media and memberships bolster larger grocers’ profitability, offsetting volume challenges through high-margin streams.[1] Firms succeeding will integrate AI, refine value propositions, and target bifurcated demands.
Modi noted that decisive actions set winners apart: “We believe the companies that create value over the next 1, 3 and 5 years will be those that have the courage to make decisive decisions that others are not willing to make.”[1]
Key Takeaways:
- Economic splits demand dual strategies for premium and value grocery segments.
- Agentic AI and GLP-1s favor agile innovators in food and beverage.
- Price sensitivity persists, rewarding private labels and promotions.
Grocers and brands must balance these forces to thrive. What changes have you noticed in your shopping habits this year? Share in the comments.
