Are SNAP recipients good customers?

A new study sheds light on the shopping habits of consumers participating in the Supplemental Nutrition Assistance Program (SNAP).

According to analysis from Numerator, overall, SNAP (federal benefits once known as “food stamps”) consumers account for nearly one-quarter (24%) of total CPG spend, and are more likely to have children, live in urban areas, and be in the bottom 30th percentile in purchasing power compared to non-SNAP consumers. 

In one good piece of news for grocery and CPG retailers accepting SNAP payments, Numerator data reveals that when SNAP consumers utilize their benefits during a shopping trip, basket size is $15 more, spend per trip on groceries is almost $18 more, and units per trip double (from 5.2 to 10.4).

In addition, during the latest quarter ending Dec. 31, 2022 compared to the same period a year earlier, SNAP consumers are paying 13% more per unit, compared to 11% more for non-SNAP consumers. Numerator says this disparity is driven by increased inflation on baby and health & beauty products that SNAP consumers over-index on, as well as in the dollar channel.

However, Numerator data indicates that units purchased per household by SNAP recipients are down significantly in snack categories such as popcorn (-23.6% year-over-year), meat snacks (-18% year-over-year)), and snack seeds, nuts & trail mixes (-15.9% year-over-year). And 26% of SNAP recipients say they are unable to buy enough food to feed their family. 

Other interesting findings include:

• 61% of SNAP recipients are in the bottom 30th percentile in terms of purchasing power, 45% have children (compared to 28% of non-SNAP households), 29% have five or more members in their household, and 37% are Gen Z or millennial. Compared to non-SNAP households, SNAP households are twice as likely to be Black/African-American or Hispanic/Latino. 
• 79% of SNAP recipients say their financial situation is the same or better compared to the prior year, but one in five say they are overwhelmed with financial burdens and 56% are concerned about job stability (compared to 31% of non-SNAP recipients). 
• SNAP consumers are 56% more likely to spend their CPG dollars at dollar stores, 24% more likely at convenience stores, and 12% more likely at mass retailers (compared to non-SNAP consumers). 
• 20% of SNAP recipients say they wish that grocery delivery services made it easier to utilize their program benefits. Currently, 12.9% of SNAP consumers use Walmart+, followed by DoorDash DashPass (5%), and Albertsons Freshpass (4.3%). 

[Read more: Walmart expands online SNAP pilot, accepts payment at pickup]

Data was sourced from Numerator Insights panel data and a sentiment survey fielded to 1,250 SNAP consumers in February 2023.