I use a variety of reusable shopping bags, but the one that has been perpetually in my backpack for the last two years is the handy (rather unfashionable) black Acme Workhorse. It stuffs into a little ball and it's functional, but it's not exactly pleasing to the eye.
I've just discovered Flip and Tumble shopping bags and I'm in love. Bye bye basic black and hello beautiful bright happy color! They stuff up into a ball, just like the others, but have a new feature, one I haven't seen yet in a reusable shopping bag. These hang on your shoulder. You can still carry them in your hands, but the handle is long enough, and padded, so that you have both options.
You have to go to the Flip & Tumble website and check these out. They are not your average shopping bag. I love the modern design and wide range color palate. The self-stuffing feature works much better than what I'm used to and looks cooler, while bright colors are easier to spot in the bottom of your backpack. The stuff mechanism even makes it's own little pocket inside the bag for loose things and the patch of felt padding on the shoulder helps keep the bag from slipping off.
They're called 24-7 bags and I think that's a perfect name, the idea being that you keep them with you all the time. I think they'd be great while traveling, at the Farmer's Market, the beach non-food related shopping trips, laundry day....any time you need a bag.
I took mine on a test run last night to get some basic groceries and found them to be comfortable and easy to use. Highly recommended!