Are you prioritising non-food? You should be

Standing out and gaining share in the grocery retail market has never been tougher, and yet most companies are ignoring a key strategic growth driver that’s already in their stores.

It’s time for grocery retailers to rethink non-food and treat it for what it is: a strategic imperative.

The overlooked growth driver

It’s easy to understand why non-food isn’t an intuitive priority for grocery retailers; in fact, the clue is in the name. Food is the core business and the primary reason shoppers visit grocery stores. Furthermore, categories like fresh food and food-to-go offer good margins, create a more sensorial customer experience, and drive frequent visits.

But prioritising food above all comes at a cost: non-food categories are often overlooked, under-funded, and afforded a marginal footprint, leading to an offer that feels tacked on instead of complementary.

The result is unrealised growth potential which businesses cannot afford in today’s highly competitive market.

Rising to the competition

Shoppers value the convenience of picking up everyday essentials in a single trip, but quality matters: they expect non-food categories to deliver relevance, value, and inspiration.

Non-food specialists, discounters, and online retailers are raising the bar in these areas, offering sharper ranges, lower prices, greater product focus, better variety, and more convenience. These advances are shifting expectations of what great looks like, and the bad news is shoppers don’t lower their expectations for non-food in grocery stores.

Consequently, retailers failing to live up to standards are risking a negative form of differentiation where their offer contrasts poorly with others. And the contrast will grow starker as non-food competitors continue to enhance, innovate, and diversify.

A platform for future performance

Strategically driven, thoughtfully executed non-food categories can deliver a range of benefits to grocery retailers. First of all, non-food products typically deliver stronger profit margins, helping to balance lower-margin grocery lines and boosting overall store profitability.

A strong non-food offer also deepens engagement and prompts broader missions, encouraging shoppers to explore and buy across departments, which helps increase basket size and trip value.

At the same time, it signals convenience, breadth and competitiveness, reinforcing the store’s reputation as a one-stop shop.

It can also strengthen differentiation if retailers provide products and experiences that offer value beyond price, such as unique collaborations and seasonal events.

Take action

The good news is it’s in the power of grocery retailers to enable their future success and hold off the competition. It just requires a change in approach. Try looking to other sectors for inspiration, like how leading businesses in fashion, health and beauty, and technology create in-store experiences.

You will also find inspiration and actionable insights in our new Retail Analysis report, ‘Winning in non-food’.

It takes a deeper dive into this topic, revealing what a strong non-food offer looks like, how the future of non-food could unfold, how retailers can navigate challenges and opportunities, and best practice from specialists in various markets.

Subscribers can find out more by reading the full report.