23% of Grocery Shoppers Alienated by High Prices

grocery prices, consumer insights

As grocery shoppers look to find the merchant best suited to their needs, a significant share of customers find themselves put off by higher-than-expected prices, threatening their loyalty.

By the Numbers

The PYMNTS Intelligence report “The Online Features Driving Consumers to Shop With Brands, Retailers or Marketplaces,” created in collaboration with Adobe, drew from an October survey of more than 3,500 U.S. consumers to better understand their actions, choices and behaviors when they shop online.

The study found that, among consumers who had purchased groceries in the previous month, 23% said that facing higher prices than other merchants was the top issue or challenge faced in the process. This share is greater than those who said the same in any other industry and greater than those who said the same of any other difficulty purchasing groceries.

Meanwhile, another 18% cited the crowds or lines as the top challenge they faced, 10% cited difficulties finding the products they wanted, and an additional 10% cited the limited selection of products.

consumers, shopping, challenges

The Data in Context

Noting the tendency of high prices to alienate consumers and conversely the power of bargains in attracting them, retail giants Walmart and Amazon are competing to offer the lowest grocery prices.

“We have almost 7,000 (price) rollbacks. That’s really helping. In our food categories, we see an even larger spread between eating at home, preparing meals at home, and eating out, which we think can help Walmart over the remainder of the year,” Walmart CEO Doug McMillon told analysts on the company’s most recent earnings call in May.

Meanwhile, also in the spring, Amazon Fresh, the eCommerce behemoth’s mass-market grocery division, began rolling out discounts of up to 30% on 4,000 items. The PYMNTS Intelligence report “Whole Paycheck Report: New Consumer Spend Data Finds Amazon Way Ahead of Walmart” found that by the end of last year, Walmart captured 18.9% of food and beverage consumer spending, while Amazon increased its share to 2.9% from 2.6% in the previous quarter.


45% of Non-Recurring Transactions Now Use Instant Payments

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The gig economy and gaming industries have driven a rise in ad hoc transactions, payments made outside of regular invoicing and payroll. Businesses are relying on instant payments to streamline these transactions, which involve contractors, consumers and small businesses.

According to a PYMNTS Intelligence report, “Gigs and Games: How Instant Payments Are Gaining Ground for Ad Hoc Transactions,” a collaboration with Ingo Payments, with increased demand for efficiency and speed, instant payment systems are becoming a preferred solution, though obstacles to wider adoption remain.

Instant Payments Comprise Nearly Half of Ad Hoc Transactions

Instant payments are gaining in popularity for ad hoc transactions, according to the report. With the demand for quicker and more efficient methods of payment, businesses are adopting real-time payment systems to facilitate faster transactions, reduce fraud risk and improve overall financial processes.

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PYMNTS found 45% of all ad hoc payments made in July 2024 were sent via instant methods, a notable increase from 36% earlier in the year. Industries that rely heavily on nonrecurring payments, such as gaming and the gig economy, have seen the most significant uptake.

Larger Enterprises Leading the Shift

Larger companies are leading the adoption of instant payments for ad hoc transactions. Businesses with more than $1 billion in revenue are sending half of their ad hoc payments via instant rails, revealing a preference for speed and efficiency. Smaller companies, however, are lagging in adoption, with those earning between $50 million and $100 million turning to instant methods for just 34% of ad hoc payments. The delay in adoption among smaller enterprises is often linked to the high costs of integrating instant payment systems into their existing processes.

Despite this, the trend toward adopting instant payment methods is gaining momentum across the board. Many large enterprises view instant payments as the future standard for ad hoc transactions, especially in business models that no longer rely on recurring payees, such as contractors or freelance workers. But challenges persist in scaling this technology across industries of all sizes.

Barriers to Broader Instant Payment Adoption

While instant payments offer considerable benefits, particularly in terms of speed, cost savings, and enhanced customer/vendor retention, the report shows businesses face obstacles in fully adopting them. For many enterprises, the cost of integrating real-time payment systems remains the primary barrier. According to the report, 35% of businesses cite integration costs as the biggest obstacle to adopting instant payments for ad hoc transactions.

Additionally, there is a digital divide, with industries like gaming and the gig economy leading the charge in adopting instant payment systems. But two-thirds of small and medium-sized businesses (SMBs), particularly those in industries with less digital momentum, are dealing with the costs and complexities of implementing these systems. Despite these challenges, businesses that do embrace instant payments could gain a competitive edge by securing customer and vendor loyalty, driving down transaction costs, and improving cash flow management.