Inflation Update: Catalina Shopping Basket Index Tracks Q3 Price Hikes in France, Japan, and U.S.

To gauge the impact of inflation on grocery prices in the U.S., France and Japan, Catalina tapped into its rich, real-time Shopper Intelligence Platform to track price increases across 10 common product categories. The Catalina Shopping Basket Index looked at the aggregate price of 10 categories in each country in Q3 of 2022 compared to the same period in 2021.

“Inflation continues to be a big concern globally this year, with some nations’ economies impacted more than others, largely due to increases in the food and energy sectors thanks to lingering supply chain disruptions caused by the COVID-19 pandemic and the war in Ukraine,” said Sean Murphy, Chief Data & Analytics Officer at Catalina. “While inflation rates may vary across borders, shoppers have a universal appreciation for getting the greatest value for their money, which Catalina is well positioned to deliver in partnership with our retail and brand customers.”

Catalina data shows U.S. shoppers continue to face double-digit price hikes, far more than in France and Japan with a few exceptions. The cost of Soaps & Detergent is rising at the fastest rate for Japanese consumers while French shoppers are seeing Paper Product prices rise the most significantly.

Retailer Inflation Chart 1

U.S. Grocery Shoppers Face Continued Price Hikes in Key Categories
In the U.S., the Catalina Shopping Basket Index measured a 15% increase in prices compared to the same quarter in 2021, posting sharper increases in most categories than the U.S. Bureau of Labor Statistics Consumer Price Index. Prices for food enjoyed at home rose 13% over the 12 months ending September 30, 2022, and the food index overall increased 11%, according to CPI. The aggregate basket average was up 5% from Q1 2022.

Q3 basket average +15% v YAGO Q1 basket average +10% v YAGO
Price increases in the basket were led by Yogurt (+21%), closely followed by Cereal (+20%), Hand & Bath Soaps (+19%), and Soft Drinks & Water (+18%). At the other end of the spectrum, the basket’s average price posted more modest increases in Paper Products (+9) and Soaps & Detergents (+6).

What’s striking is the trajectory of U.S. price increases in some categories when comparing Q1 to Q3. Both Yogurt and Hand & Bath Soaps’ rates of inflation grew 13 percentage points, followed by Frozen Vegetables. Inflation rates slowed in two categories: Paper Products fell from 11% to 9% while Soaps & Detergents dropped from +12% to 6%.

Retailer Inflation Chart 2

French Grocery Shoppers See Mixed Impact of Inflation on Baskets
France’s overall inflation rate lags other members of the EU, largely because it is less reliant on fossil fuel products. For September 2022, INSEE, France’s national statistics bureau, reported that food prices climbed 10% YOY, largely driven by an 11% increase in fresh food prices.

Catalina’s Shopping Basket Index for Q3 2022 shows that categories with the highest rate of inflation in France include Coffee (+11%), Paper Products (+10%), Frozen Vegetables (+9) and Yogurt (+9%), largely on par with INSEE’s average inflation rate for the period. But many categories fell far below that average, including Cereal (+5%), Soft Drinks & Water (+4%), Hand & Bath Soaps and Soaps & Detergents (+3) and Deodorants (+1).

Inflation Has Relatively Modest Impact on Japanese Grocery Shoppers
Japan’s economy shrank in Q3 2022 due to a weak yen and high inflation. For September 2022, Japan’s National Consumer Price Index reported that its composite index (excluding fresh food) rose 3% YOY to a 31-year high. Food Inflation ticked lower to 4% in September, down 0.5% from August.

Only two product categories in Catalina’s Shopping Basket Index are posting higher than the country’s food inflation average, Soaps & Detergents (+8%) and Frozen Vegetables (+6%). Prices for Yogurt (+1%), Cereal (+0%) and Deodorants (-1%) show modest shifts.

Strategies For Marketers in Inflationary Times
“Insights about traditionally price-sensitive and value-seeking shoppers apply to more consumers now. This is an opportunity for brands to fine-tune their omni-channel approach to deliver relevant offers and valuable incentives to help shoppers make the most of their dollars in these inflationary times,” said Murphy, who advises brands to consider strategies that are designed to combat inflation:

  • To drive sales lift and build loyalty, build omni-channel campaigns that include multiple digital channels and in-store point-of-sale.
  • Maximize every dollar by developing targeted shopper cohorts, built from fine-tuned audience segments.
  • Use a real-time feedback loop to measure and continuously adjust campaign performance to stretch your marketing budget farther.

To learn how Catalina’s proprietary shopper intelligence insights can help your brand, reach out to us.

Read associated press release