the inside the in-store experience powered by The Integer Group ® and M/A/R/C ® Research 1.10 issue in focus: 2009 Holiday Shopping This month we asked shoppers about their holiday shopping plans this season. Do they expect to spend more, less, or the same compared to last year? Which retail channels will be most aected? • Frugal shopping behaviors may be easing—slightly • ‘Tis the season to be practical • Use of coupons continues to increase • Are private-label brands the new reality? • Shoppers become more sophisticated to find best value • Shoppers favor contests they think they can win • Shoppers love deals—any deals. In focus: Name Brands Tightening budgets, lowered consumer sentiment, and an unsure economic future—to remain competitive in this challenging shopping environment, name brands have an arsenal of tactics at their disposal • Properly communicate value • Prepare to win back your shopper when the economy imporoves—starting now • Continue to actively issue coupons, awareness messages, and rebates in store • Offer a breadth of product varieties and special editions • Concentrate on at-shelf messaging and in-store promotions, since more decisions are being made at shelf • Be aware that contests with a higher chance of winning appeal to a larger number of shoppers— even if the prizes are smaller • Be ready to make a deal IN THIS ISSUE
The first Checkout of 2010 picks up where 2009 left off, and shows that private-label brands are continuing to gain strength over name brands. Is this a temporary reaction to recent economic pressures -- or the new reality? What factors are shoppers considering when choosing between name brands or store brands that ultimately lead to their decision?
This issue's In Focus: Name Brands, tightening budgets, lowered consumer sentiment, and an unsure economic future -- to remain competitive in this challenging shopping environment, we discuss a number of tactics name brands can use to remain relevant.
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
the
inside the in-store experience
powered by The Integer Group® and M/A/R/C® Research1.10issue
in focus: 2009 Holiday ShoppingThis month we asked shoppers about their holiday shopping plans this season. Do they expect to spend more, less, or the same compared to last year? Which retail channels will be most a!ected?
• Frugal shopping behaviors may be easing—slightly• ‘Tis the season to be practical• Use of coupons continues to increase• Are private-label brands the new reality?• Shoppers become more sophisticated to find best value• Shoppers favor contests they think they can win• Shoppers love deals—any deals.
In focus: Name BrandsTightening budgets, lowered consumer sentiment, and an unsure economic future—to remaincompetitive in this challenging shopping environment, name brands have an arsenal of tacticsat their disposal
• Properly communicate value• Prepare to win back your shopper when the economy imporoves—starting now• Continue to actively issue coupons, awareness messages, and rebates in store• Offer a breadth of product varieties and special editions• Concentrate on at-shelf messaging and in-store promotions, since more decisions are being made at shelf• Be aware that contests with a higher chance of winning appeal to a larger number of shoppers— even if the prizes are smaller• Be ready to make a deal
IN THIS ISSUE
powered by The Integer Group® and M/A/R/C® Research1.10issue
2page
powered by The Integer Group® and M/A/R/C® Research1.10issue
In the past three months, how has your shopping behavior changed?
Shopping Behavior Compared to Three Months Ago
? =
Shopping behavior, while continuing to skew toward reduced spending, appears to be #attening out—with a slightly larger number of shoppers moving away from buying few/cheaper items in October. While spending among both males and females is loosening some,men appear to have been much more resilient going into the holiday season.
(%)
powered by The Integer Group® and M/A/R/C® Research1.10issue
3page
2
When thinking about your everyday shopping needs (food, cleaning products, etc.), what would you say is the primary goal you are trying to meet from each trip you take?
Get everything in asingle trip, saving
need for more trips
Spend aslittle as possible
Comprehensiverestocking of theitems I have used
Satisfy theneeds of all myfamily members
Quick fill-in tripsto replace the
things I use as I go
Find thefreshest and
best-quality items
Spend as littletime in the store
as possible
Be entertainedand have a fun time
Predominantly men
29 29
2625
28
23
2624
12 12 1213
8
11 1112
810
11
13
78
76 6
76
4
1 2 23
Predominantly women
Everyday Shopping-Need Goals
? =
Shoppers are still torn between convenience and saving money as primary shopping goals. Tightening budgets, lowered consumer sentiment, and an unsure economic future has resulted in a shift in shoppingbehaviors from performance (quality and shopping experience) to conservation of resources (time and money) accompanied by changing expectations. Retailers (dollar stores, discount mass) and brands (private-label and value players) that focus on lower prices will be better positioned to face this challenging selling environment. But strongly entrenched name brands can still compete by properly communicating value to their shoppers.
This newfound practicality is further exempli"ed by the steady increase in quick "ll-in trips during the course of the year, suggesting that shoppers are taking a spend-only-when-necessary position. This attitude toward spending as little money as possible is most prevalent among female shoppers, while their male counterparts place a higher value on spending as little time as possible.
However, practicality has not yet taken hold of our younger shoppers (18-24) who are in store more often and have a higher tendency to make "ll-in trips and seek entertainment compared to their older counterparts.
‘Tis the season to be practical
Arrow indicates signi"cant di!erence fromprevious quarter at 95% con"dence level
1Q’09
Q2’09
Q3’09
Oct’09
(%)
powered by The Integer Group® and M/A/R/C® Research1.10issue
4page
directional signs above the aisle
coupons from a manufacturer
shopper-card discount
self-checkout
coupons from the store
newspaper circular
circular from inside the store
floor ads in store aisles
message on the shelf
a poster hanging from the ceiling
in -store associate
leaflet
touch-screen device
electronic kiosk
in-store PA announcement
in-store TV
Thinking about your most recent shopping trip for groceries, which of the following did you use in the store to help you shop?
Coupons, always one of the more popular shopping aids, have become even more important in the second half of 2009, indicating the economic e!ect of the recession on shopping behavior. Use of mobile phones, while still relatively limited, has nonetheless increased over the course of the year potentially due the growing usage of smart- phone shopping and information-seeking applications. This is especially true with younger shoppers (18-24), 15% of whom report using mobile phones as shopping aids versus 5% for those aged 35 and over.
powered by The Integer Group® and M/A/R/C® Research1.10issue
5page
seek out lowest possible price
save money by shopping around
save today,buy tomorrow
stick with familiar brands or items
buy individual-sized items
seek out American-made
spend more but save time
buy now on credit
switch brands or try new brands
more often
buy in bulk
Q1’09
Q2’09
Q3’09
Q1’09
Q2’09
Q3’09
Q1’09
Q2’09
Q3’09
Q1’09
Q2’09
Q3’09
Q1’09
Q2’09
Q3’09
Q3’09
describes more
41
37
39
35
31
30
35 41 19 6
32 44 19 6
33 42 18 6
22 44 26 8
22 47 25 6
22 47 25 6
14 34 37 15
14 36 38 13
13 37 37 13
43 21 5
45 19 5
Oct 29 45 22 4
42 19 5
40 16 5
41 17 5
Oct 37 41 17 5
39 15 6
buy private-label/store brands buy national/
name brands
15 46 32 7
Oct 16 47 30 7
Oct 14 35 40 11
Oct 22 47 26 5
Oct 32 44 20 4
Consumer behavior continues to skew toward lower spending, with males more apt to make credit purchases and seek out American-made products. Single shoppers are more willing to spend money to save time. Higher-income households ($100K+) are more likely to purchase name brands, while 28% of younger shoppers (18-24) report that they are more loyal to their usual brands and less apt to switch.
Indicates significant difference from previous month at 95% confidence level.
Currently, where do you believe you fall between the following?? =Shopping Preferences
Consumers are still in the mindset of saving money
(%)
powered by The Integer Group® and M/A/R/C® Research1.10issue
6page
october
7
8
10
20
54
july
7
8
10
19
56
Buying more store brands, and will probably buy even more
Buying fewer store brands than last year
Buying more store brands, but probably will switch back to name brands
Buying more store brands, and will probably stock with them
Buying store brands about the same amount as last year
Store-Brand Descriptors
Which statement about store brands best describes you?? =
(%)
Have store brands become the new reality?
The number of shoppers switching to store brands seems to have reached a plateau with no signi"cant changes after steadily increasing until the second quarter 2009. The question is: will those people who have been prompted to switch to store brands due to the recessionswitch back when the economy improves?
powered by The Integer Group® and M/A/R/C® Research1.10issue
7page
There were signi"cant drops in shoppers reporting that they always consider trust in their name brand, sale prices, and coupons as reasons they do not buy store brands, potentially alluding to the growing strength of private-label products. The overall ranking for the top "ve reasons shoppers gave for not buying store-brand alternatives remained relatively the same, with brand often being on sale, trust in the brand, and satisfaction with the regular price making up the top three. However, this month saw two major changes at number four—shoppers are less doubtful of the quality of store brands, but they are less likely to switch from their name brands due to the di!erent varieties of product available. As the sophistication of store brands catch-up, name brands will have to justify their higher prices with continuing innovation and engaging product o!erings.
Shoppers increasingly consider variety as areason not to switch to private label brands
If you've seen a store-brand option for some of your groceries orhousehold goods but decided to stay with a name brand, what arethe reasons for not buying the store-brand option?
314
Indicates significant difference from previous month at 95%
confidence level
sometimes a reason
always a reason
never a reason
(%)
35
53
12
65
20
15
52
20
28
70
13
17
67
19
52
40
8
32
64
4
48
49
3
315
31
59
10
63
16
21
59
20
21
70
14
16
62
23
56
34
10
28
69
3
51
46
3
JUL
OCT
9
68
23
11
62
27
It’s (name brand) just a brand I trust
My brand is often on sale
My brand has special
versions or varieties that I can’t get in store brands
I can get coupons for
my brand
The regular price of my brand is fine
Doubts about quality
of store brand
product
I use the product so
little that it’s not worth switching
I don’t like the store
brand packaging
Other
? =
Reasons Not Buy Store Brands
powered by The Integer Group® and M/A/R/C® Research1.10issue
8page
Arrow indicates significant difference
from previous month at 95% confidence level
Strongly Agree
Agree
Private label brands continue to gainstrength with shoppers and their families
Compared to store brands, how much do you agree with the following statements about name-brand groceries or household goods?
37%
Name brands aremore expensive
Name brands offer more newproducts, varieties, and innovations
Packaging of name brandis more attractive
Name brandsare more reliable
Name brands arebetter-quality products
Name brandspackaging works better
Name brands are whatmy family expects to get
Name brands better reflectmy values and attitudes
? =
Name-Brand Statement Agreement
While most consumers continue to perceive name brands as more expensive (80%) while o!ering greater variety and innovation (57%) than store brand alternatives, this number has signi"cantly decreased since last quarter. Shoppers also perceive less di!erence in product quality and their families are becoming more used to having store brands in the shopping basket. High income shoppers ($75,000+) and younger (18 – 24 year old) shoppers have a greater a$nity for name brands and are more apt to feel that they are more reliable, o!er greater breadth of products, and have packaging that is more attractive or that works better.
(%)
22 62 22 58
7 50
8 41
3 34
4 31
2 21
2 15
1 14
9 55
9 43
4 33
4 35
3 19
3 18
2 12
84
64 57
49
37
35
23
17
15
52
37
39
22
21
14
80
JUL OCT
powered by The Integer Group® and M/A/R/C® Research1.10issue
9page
Arrow indicates significant difference
from previous month at 95% confidence level
Shoppers appear to be growing in sophistication andbecoming more involved in the decision making process
Thinking about your most recent shopping trip for groceries, which of the following did you use in the store to help you shop?
I regularly compare prices betweenname brands and store brands
I’ll look at what’s on sale first andthen compare that to other options
I look for my usual brand on shelf,thenlook around for store-brand alternatives
I’ll look for what i have coupons for first,then compare that to other options
I get information from friends and familyabout store brands before trying them
I go right for the name brands andget what I want
I’ll try whatever’s being featured by thestore (such as display on end of aisle)
I go right for the sotre brands andget what I want
I ask sales associates which brandoffers the best quality for the price
Strongly Agree
Agree? =
While most shoppers still indicate that they are price sensitive, this month saw signi"cant changes in shopping behavior with fewer shoppers going straight to the sales items, to their usual brand, or even store brands – indicating that they are making more of their decisions at shelf. Decision-making between name and store brands encompasses a variety of price considerations – including comparing on-shelf prices and checking sales and coupons before buying. Their shopping sophistication appears to be further increasing as shoppers reported that they are less in#uenced by sales features (such as end-caps), asking associates for product opinions.
(%)
26 54
24 57
9 59
18 45
2 19
4 23
3 20
2 20
2 7
80
81
68
63
27
21
22
9
23
26 52
21 56
9 55
17 46
2 22
3 19
18
2 16
15
78
77
64
63
22
24
18
6
19
JUL OCT
Store-Brand Shopping
powered by The Integer Group® and M/A/R/C® Research1.10issue
10page
More than half (56%) of shoppers "nd a modest prize with a reasonable chance of winning to be more appealing than a larger prize with worse odds or a greater chance of winning a small prize. However, when considering how to structure your promotion and the value of your prize, consider your target shopper—male shoppers have a higher a$nity for contests with modest prizes and reasonable chances, while female shoppers prefer having a higher chance of winning a small prize.
Surprise! Shoppers prefer conteststhat they actually think they can win
When considering promotional contests in a store, which type of offer is most appealing to you?
OCT
Small prize withhigh likelihood
of winning
Large prize,even if chances of
winning are slim
Modest prizewith reasonable
chance of winning
? =
Most Appealing Promotions
33
11
56
(%)
powered by The Integer Group® and M/A/R/C® Research1.10issue
11page
Consumers appear to want to take advantage of any deal they can "nd; however, buy-one-get-one-free o!ers or clearly marked reduced prices are the ones most likely taken advantage of. Women are more likely than men to take advantage of promotional o!ers, whereas older consumers are more willing to invest time in money-saving activities with a larger use of rebates, mail, and newspaper coupons. However, not all shoppers respond with the same fervor to all types of deals—younger shoppers reported that they do not readily change their behavior based on coupon o!ers but were signi"cantly more likely to shop clearance items.
Which money-saving techniques are you most likely to take advantage of in a store?
BOGO free or at reduced price
66
65
57
55
53
44
42
41
68
68
80
Rebate offers
Coupons from magazines
Coupons from internet
Money off if purchase two or more
In-store circulars
Coupons from mail
Coupons from newspaper
On-pack instantly redeemable coupons
Clearance items
Store savings from loyalty/rewards card
? =
Shoppers love deals—any deal
Money-Saving Techniques
OCT (%)
powered by The Integer Group® and M/A/R/C® Research1.10issue
12page
The Integer Group® (www.integer.com) is one of America’s largest promotional and retail marketing agencies and a key member of the TBWA\Marketing Services portfolio. The Integer Group resides At the Intersection of Branding and Selling® and creates strategic marketing solutions for clients in categories that include beverage, packaged goods, telecommunications, fast food, home and shelter, and power sports. Join Integer® in a conversation on shoppingculture and brand strategy at:
M/A/R/C® Research is a brand development firm dedicated to helping clients create, evaluate, and strengthen their brands. Our teams design and execute qualitative and quantitative, traditional and online solutions while adhering to a client-service ethic built on being easy to work with and delivering what is promised.
Our core competency is measuring attitudes and behaviors to accurately explain and predict market share, revenue, and bottom line impact of a client’s actions. We help our clients address consumer, channel, and B2B marketing issues to launch better products and services, attract and retain valuable customers, and build stronger brands. Our proven, marketing-issue focused solutions support clients’ brand building efforts.
The Checkout is based on a nationally representative survey of 1,200 U.S. adults conducted monthly by M/A/R/C Research. Please contact us to learn more about the data we collect or additional analysis.