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Where Are You Buying Your Groceries?

Where do you shop and why?
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Before you answer, pause and ask yourself if you are shopping for foods differently than you did just a few years ago. You may have changed your purchasing habits because you want more local or fresh foods, or healthier foods or perhaps you are just trying to save money. But there is another influencer at work -- the food stores themselves are changing.

You might have noticed that supermarkets are shrinking in size. Some notable food retailers including Walmart (which was reported in this Ad Age column) Tesco's Fresh & Easy and Schnuck's are rolling out smaller stores. There is no doubt that the smaller stores require less labor and costs to operate, but they also offer shoppers benefits. Some stores like Trader Joe's offer a wow! and much more personal shopping experience, while others like their sister company, Aldi's, offers a bare bones, quick in-and-out approach. Other stores like the iconic IGAs (nearly 5,000 stores) that are mostly independent, family-owned and found in smaller towns in 46 states offer the ultimate neighborhood grocery experience.

The retail food landscape is changing even further, and very quickly. If you haven't started buying your foods in dollar stores or drug chains -- it is time to check them out.

The top four dollar chains in the United States (Dollar General, Family Dollar, Dollar Tree and 99¢ Only) already have over 21,500 stores. And they want your food dollars -- for groceries, frozen and perishables! While shopping at a dollar store might not have been on your "to-do" list five years ago, it is clear based on surveys we conduct with our SupermarketGuru Consumer Panel, that today people are shopping wherever they can to save money. We all seem to love a deal regardless of how much money we have.

And then there are those drug chains: Walgreen's, CVS and Rite Aid who now have over 19,000 stores total. Walgreen's has committed to filling food deserts in urban Chicago areas. But it is the chain's new flagship store in Chicago's Loop that stands out with a sushi and sashimi bar, self-serve yogurt, a juice bar featuring fresh fruits, vegetables and made-to-order smoothies, craft beers, spirits, gourmet chocolates, a cigar humidor and more than 400 varieties of wine priced as high as a $450. They also have an Upmarket Café with a barista and fresh-baked goods; and hundreds of fresh-food items, including wraps, sandwiches and salads for on-the-go consumption.

All three of the chains have openly committed to challenge the traditional supermarket on the food front -- offering competitive prices on staples such as milk to healthier fresh and frozen food offerings as well.

One benefit for the drug chains imminent successes is their locations -- usually more urban than suburban. A huge opportunity as we see more Baby Boomers and Millenials moving back to these areas, preferring to be near work and friends, avoiding commuting and looking for a bit more excitement than suburbia may offer.

These days, I divide my own food dollars between Trader Joe's, Whole Foods, One Life (an independently owned health food store), Santa Monica's Farmer Market every Sunday and Albertsons.

Where do you shop and why?