Report: Consumers focus on fewer stores, lower prices

CHICAGO Shoppers are cutting back on the number of stores they are visiting, concentrating visits on stores known for lower prices and generally visiting stores less frequently and spending less per trip, according to a report SymphonyIRI Group released Thursday titled “The New Path to Purchase: An Escalation of Channel & Consumption Migration.”

“Shoppers are not enjoying the same financial success as corporations this spring and summer, and their continued search for lower-cost retail channels reflects this,” stated John McIndoe, SVP marketing at SymphonyIRI. “In addition to potential pressure on retailer revenues and margins, these trends point to managers having fewer chances to ‘get it right’ with shoppers. If a shopper visits a store and is unhappy with the experience, she will quickly go elsewhere.”

Grocery remained the dominant channel, with 98.4% penetration over the 52 weeks ended June 27. Other leading channels included drug (77% penetration), mass merchandise (71.6%) and supercenters (69.5%).

Supercenters enjoyed the largest penetration increase of 190 basis points, followed by dollar stores with a 50 basis point increase. Mass merchandise penetration fell 230 basis points, while convenience store penetration declined 1.9 points and drug dropped 50 basis points.

The number of shoppers visiting fewer than five stores has increased every quarter since second quarter 2009. In contrast, those shopping at five to nine stores in the same time frame has dropped every quarter but one. The number of people shopping at 10 or more stores has remained approximately the same.

Overall, trip frequency began to decline consistently starting in fourth quarter 2009; in second quarter 2010, it declined nearly 2% versus the same period the prior year, driven by declines in the convenience store and mass merchandise channels, which experienced slides of 9% and 7%, respectively. Across most other channels, average purchase occasions remained fairly steady.

Dollars per purchase occasion, which were growing at approximately 5% in third quarter 2008 versus the same period the prior year, fell flat in third quarter 2009 and now are declining by more than 1%. While grocery, supercenter and club channels have seen average basket size slide over the past year, convenience, dollar and drug stores enjoyed significant increases of 8%, 3.8% and 1.7%, respectively.

A majority of trip missions have seen total trips to retailers decline steadily for nearly all categories since second quarter 2009. The exception is quick trips, or small “need-it-now” shopping excursions, which remained constant for the second half of 2009 and then jumped dramatically in second quarter 2010. Similarly, basket size across trip missions has declined most quarters since second quarter 2009. Once again, quick trips were the exception, consistently demonstrating increased basket size each quarter, beginning in third quarter 2009.

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