Shoppers take it easy
Whether it’s cutting back on meal prep or reducing the time spent shopping in the first place, convenience continues to shape Australia’s grocery habits.
By Retail World Features Editor Hailey Settineri.
The desire for convenience has shaped the grocery sector perhaps more than any other trend. From the ability to get all your goods in the one spot, to not even having to be there in person to do so, supermarkets have adapted their range and services over the years to appeal to the time poor.
CommBank iQ’s ‘Cost of Living Insights’ report released in November and comparing the period July-September 2024 with the corresponding period in 2023 reveals Australian shoppers continue to prioritise convenience, as well as value. A five per cent increase in spending on the ‘general retail’ category over the previous year was driven by convenience and cheaper alternatives, highlighted by increased spending on online marketplaces (up 20 per cent). Spending also increased on food delivery (six per cent) and streaming services (13 per cent) as consumers increasingly sought such conveniences.
“The fact that spending has increased on food delivery and streaming services suggests consumers are foregoing meals out to treat themselves at home,” said Wade Tubman, CommBank iQ Head of Innovation and Analytics.
Ordering in is not the only easy meal solution on the rise. According to Innova Market Insights’ ‘Category Growth Drivers in Australia’ report, one in four surveyed consumers are buying more meal preparation solutions, including bouillons, stocks, seasonings, table sauces, condiments, and ready meals. Notably, two in four surveyed consumers are turning to ready meals for convenience, over-indexing the global average.
“Consumers prioritise taste and flavour across all meal preparation categories, and they also seek product safety and premium claims,” reports Innova, which notes that ‘made with real ingredients’ or ‘natural’ claims are more important in meal preparations to Australian consumers compared with the global average.
Insights platform Statista estimates revenue in the Australian convenience food market will amount to US$4.15 billion in 2025, with the market expected to grow annually at a CAGR of 4.56 per cent from 2025 to 2029 (‘Convenience Food – Australia’). The average volume of convenience food consumed per person is expected to amount to 15.5kg this year.
Statista analysts say the market’s moderate growth is due to factors such as busy lifestyles, increasing consumer demand for convenience, and the availability of a wide range of ready-to-eat meals and soups. While concerns about the nutritional value of convenience foods has impacted the market growth, it has also led to the shift towards options perceived as offering health benefits.
“As consumer lifestyles become increasingly busy and time poor, the convenience food market in Australia is experiencing a rise in demand for healthy, ready-to-eat options,” Statista said. “This trend is fuelled by a growing health consciousness among consumers, who are looking for convenient and nutritious meals that fit into their fast-paced lifestyles.
“Additionally, with an ageing population and a rise in single-person households, there’s growing demand for single-serve and portion-controlled convenience food options. As a result, manufacturers are focusing on developing healthier and more diverse convenience food options to cater to this shifting consumer preference.”
Statista analysts forecast that demand for organic and other options for healthy eating will continue to surge with ongoing demand from millennials and Gen Z
Retailers Respond
Early last year, Woolworths began trialling a range of “convenient and affordable” meal options for the family. Ranging from pastas through to a full 1.6kg roast dinner, all the 35 options are made to cook within 35 minutes and are air-fryer friendly to cater to the increasing popularity of the kitchen gadget among many in Australia.
The launch followed Woolworths customer research showing that 40 per cent of surveyed customers are cutting back on eating out, or not eating out at all, to help save money.
“Convenience meals are not new,” said Matt Harbich, Merchandise Manager for Chilled Meals at Woolworths. “However, we’ve come very far from the bland microwave dinners of the past.
“Pre-made meals are getting tastier and better, and we have the benefit of our Woolworths Food Company team and supplier partners being able to create a range of tasty and hearty options for us to bring to market to test and learn based on current food trends. This allows us to continue to evolve the range based on what our customers want.”
For independents such as FoodWorks, expanded ready-to-eat hot food and pre-prepared heat-and-serve food options are creating a point of difference and meeting customer needs.
“Australians are looking to reduce how long is being spent shopping and cooking each week, reprioritising recreation and family time,” Australian United Retailers (AUR) National Operations Manager Robert Markezic told Retail World.
“Customers are increasingly focusing on time-saving measures that help them battle busy lifestyles and focus more on doing what they love.”
Meal kits and more
Australian consumers are also seeking convenience outside the supermarket – and not only through grocer-led online shopping. Meal kit delivery services such as HelloFresh and Marley Spoon soared in popularity during the Covid lockdowns and have remained a popular option in the years since, transitioning from an unexplored niche to a mainstream affair for many consumers. IBISWorld estimates industry revenue has grown at a CAGR of 17.2 per cent over the past five years, to reach an estimated $1.1 billion in 2024 (‘Meal Kit Delivery Services in Australia’, IBISWorld).
Consumers have become more comfortable with online ordering, and meal kit companies have capitalised on this trend by offering user-friendly websites and mobile apps for ordering and customisation. It’s also worth noting that many meal kit businesses have expanded their offer to include ready meals, fresh fruit, soft drinks and other items. A customer may choose to add a box of fruit, heat-and-eat lunches, ‘healthy’ snacks, premium chocolate and some alcohol-free beer to their order – timesaving for them, but such purchases also chip into potential supermarket spend.
Aside from the time-saving factor, meal kit deliveries have the potential to save shoppers money – depending on their habits. Consumer watchdog CHOICE compared the price of a HelloFresh box with the equivalent ingredients needed to make the recipes from Coles and Woolworths. It found you don’t actually pay much less at a supermarket, and sometimes you pay more once you factor in delivery costs if you’re ordering online. However, CHOICE also noted that weekly shopping customers are more likely to take advantage of special offers or buy larger packs that offer better value for money (assuming leftover ingredients are used up).
Rising demand for fresh convenience options
As traditional delis continue to disappear from the major supermarket retailers’ stores across the country, many independent supermarket owners are instead taking a fresh approach.
AUR is helping its network of 580 supermarkets, food and convenience stores (including more than 400 FoodWorks stores) respond to the popularity of homestyle ready-to-go food.
“A reimagined store offering can deliver customers what they really want – food that is quick and easy to prepare,” Mr Markezic said.
“AUR supports our store network to align their offer with the demand for convenience foods. This means creating new opportunities by prioritising preprepared, ready-to-eat and heat-and-serve foods.”
He says stores are increasingly implementing ranges of hot food that make lunch and dinner a breeze, with low or no effort required for customers to put a fresh and healthy meal on the table. Fresh lunch offers, including salads and rolls, are also proving popular.
“Right across the AUR network we’re seeing retailers embrace innovation and opportunity in convenience trends,” he said.
“From fresh sushi bars at Mansfield and Bacchus Marsh [in Victoria] to an in-house deli and fresh cooked meals at East Corrimal [Wollongong] in NSW, when the right strategy is paired with a store’s potential customer pool, we’re seeing exceptional results.”
For the stores focusing on this trend in recent years, their success is continuing to build, with customers increasingly turning to their local supermarket for takeaway lunch and dinner options that require little to no preparation.
“At FoodWorks East Corrimal, the store more than doubled its lunchtime trade by transforming its deli offering,” Mr Markezic said.
“As a mid-sized top-up supermarket, after-school was traditionally the busiest time of the day, but now lunchtime trade is just as busy as peak afternoon, and the store has grown steady foot traffic throughout the whole day.”
Mr Markezic says FoodWorks and other AUR stores’ community-focused service offering and the flexibility to tailor their range create opportunities to deliver exactly what locals are seeking.
“Stores can listen to the ideas, feedback and suggestions of their customers and be nimble in their testing and implementation of new service offerings,” he said.
*This article was originally published in Retail World February 2025 magazine on 21 February 2025. For more information, visit Retail World retailworldmagazine.com.au