SOLON, Ohio – After peaking in December, featured grocery prices dropped a little in January, according to ECRM's monthly report on promoted prices gathered from the weekly circulars of more than 200 retailers. Promoted prices for a typical shopping basket of 33 frequently-purchased products fell 0.8 percent vs. December, but rose 5.0 percent when compared with January 2011.
Promoted pricing for meat, poultry and seafood headed up the declines from December’s high tallies. However, January’s protein prices are still higher than one year ago.
Promoted grocery prices tend to decrease in January before elevating again in February, which happened in 2011. ECRM said this is driven partially by retailers offering their most aggressive prices at the start of the year.
Regarding most products, promoted prices show a strong correlation with the US Consumer Price Index (CPI). ECRM's pricing report includes forecasts for January CPI pricing across several products.
In comparing select December 2011 CPI forecasts based on promoted retail prices against the January 2012 ECRM forecast, 100 percent beef ground chuck was $3.27 vs. $3.20 per lb. while sliced bacon was $4.55 vs. $4.48 per lb., respectively. CPI prices for January 2012 will be released later in February by the US Bureau of Labor Statistics.
By measuring promoted pricing, researchers can get a better understanding of what promoted prices are for frequently-purchased products. "We are processing over 5 million retail feature ad blocks every week,” said ECRM's Scott Whalley. “This gives us great insight into actual prices consumers are paying across the country."
Promoted prices, unlike other pricing metrics, are reported by ECRM on the same day retailers post their weekly features.
For January, the report indicates smaller grocers tend to have the most competitive pricing, and thus beating the larger, national chains.
Many of the biggest supermarket chains featured price points higher than the national average in January, but several exceptions include Kroger, Meijer and Giant Eagle where aggressive feature prices in January indexed lower than many of the larger chains.