Changes to eligibility for the Supplemental Nutrition Assistance Program (SNAP) and new restrictions on what participants can buy with their benefits are reshaping grocery spending patterns and how retailers attract and retain shoppers, according to Circana data.
“Three big things happened in the first half of 2026,” Sally Lyons Wyatt, chief advisor for CPG and foodservice insights at Circana, said during a recent webinar on SNAP program impacts.
The first: Multiple states rolled out USDA-approved pilot programs restricting SNAP purchases of products deemed unhealthy, including soda, candy and energy drinks. USDA approved 23 states for food-choice waivers.
Second, a federal court blocked waivers in five states last month: Colorado, Iowa, Nebraska, Tennessee and West Virginia. The court ruled that USDA exceeded its authority in granting state waivers that allowed various SNAP purchase bans. Halting the soda and candy restrictions cast “uncertainty” over the other states, Lyons Wyatt said.
And third, changes in federal funding and enrollment requirements imposed stricter work requirements, including raising the upper age limit for certain work requirements from 54 to 64, while also eliminating SNAP’s nutrition education arm, SNAP-Ed.
‘The SNAP footprint is contracting’
A significant impact of these policy changes in 2026 has been the loss of roughly 2 million SNAP households and a decline in EBT spending of about $10 billion compared to 2025, Lyons Wyatt said.
EBT, or electronic benefits transfer, act like a debit card which contains SNAP funds deposited by USDA.
“The SNAP footprint is contracting,” she added.
With declining household participation and lower EBT spending comes a shift in shopper behavior as consumers carefully consider how to maximize value.
What are SNAP shoppers prioritizing?
Fresh foods and meal-building basics are being prioritized over prepared and convenience-focused options, according to Daniel Joyner, complete consumer consultant at Circana.
“SNAP shoppers appear to be shifting away from more discretionary items and toward foods that provide greater meal utility,” he said.
Foods such as fresh produce, meat and protein, dairy and frozen fruits and vegetables are being purchased more often than deli-prepared foods, soda, candy and energy drinks, particularly in waiver states, according to Circana.
“Their motivation skews toward value and satiety, foods that actually can keep them full longer,” although “sometimes at the expense of health and enjoyment,” Lyons Wyatt added.
The impact of SNAP waivers
SNAP and EBT trips that included carbonated soft drinks fell by eight percentage points year over year and by nine percentage points in waiver states, highlighting the impact that restrictions have on spending, according to Circana.
SNAP candy purchases declined by six percentage points in waiver states, while overall spending fell about one percentage point in the same time period, according to Circana.
Energy drinks’ underlying demand kept spending positive despite the waivers, with purchase incidence declining by roughly five percentage points, per Circana. However, the waivers are “clearly suppressing what would otherwise have been a much stronger growth,” Lyons Wyatt noted.
Joyners added that “these restrictions have an impact, and consumers are adjusting their SNAP-supported purchases in direct response to these policy changes,” Joyner said.
Retailers adapt to a more value-conscious SNAP shopper
SNAP households’ represent an important consumer base for retailers of all sizes, making enrollment and spending declines particularly impactful.
USDA data showed that in 2022, SNAP households spent roughly $544 more on food at home than non-SNAP households in the lowest income quartile. The National Council on Aging estimates SNAP accounts for approximately 8% of household food purchases.
Although the number of SNAP shoppers has declined and purchasing habits increasingly prioritize value, retailers recognize they must move beyond accepting EBT and develop programs that focus on affordability, convenience and nutrition, Lyons Wyatt said.
For example, Kroger’s Verified Savings Program targets SNAP, WIC and Medicaid recipients. The program offers 20% off fresh produce, 50% off of Boost memberships and automatic discounts once eligibility is verified.
“SNAP households are responding to solutions that can make grocery shopping easier, more predictable and more accessible,” Joyner said.
Expanding SNAP and EBT payment options for e-commerce has also shaped retailers’ strategies to attract and retain shoppers.
“The industry is shifting beyond simply SNAP acceptance, but towards affordability, convenience and digital support,” Lyons Wyatt said.
Target’s dedicated SNAP/EBT online payment system allows for an easier e-commerce shopping experience for SNAP recipients.
Amazon has expanded its EBT acceptance online and offers discounted grocery delivery options for eligible households. The e-commerce giant also introduced produce rewards and incentives for SNAP shoppers.
“By lowering both access and affordability barriers, Amazon is pulling SNAP households into the broader grocery ecosystem,” Lyons Wyatt noted.
