IRI: Government shutdown could have lasting impact on shopper behavior
CHICAGO — According to IRI’s Q3 2013 MarketPulse survey results released Tuesday, 85% of American consumers were aware of the looming debt ceiling crisis and of the government shutdown, which is clearly impacting their views of their personal finances, including their approach to grocery shopping.
“Consumers have been locked in a prolonged game of economic dodgeball, with one challenge after another coming right at them,” stated Susan Viamari, editor, IRI Times & Trends. “The government shutdown and debt ceiling crisis are just more hurdles, and the growing uncertainty really has consumers worried and hunkering down.”
The impact on finances and day-to-day living is expected to be significant, with some consumer segments bracing for particularly challenging conditions. Lowest-earning households (those earning less than $35,000 annually) will be hit the hardest, with families and millennials faring only slightly better. Consumers called out the following specific concerns about how they expect the fiscal crisis to impact their personal finances and shopping behaviors:
- 46% of all consumers anticipate increased financial strain, versus 63% of lowest-earning households, 56% of households with kids and 54% of millennials;
- 45% of all consumers plan to increase focus on grocery prices, versus 62% of lowest-earning households, 54% of households with kids and 48% of millennials;
- 35% of all consumers expect to have less money, versus 55% of lowest-earning households, 44% of households with kids and 42% of millennials;
- 33% of all consumers expect increased difficulty in meeting monthly expenses, versus 55% of lowest-earning households, 45% of households with kids and 41% of millennials; and
- 31% of all consumers will eliminate/reduce trips to some favorite stores, versus 45% of lowest-earning households, 39% of households with kids and 35% of millennials.
Consumers across the board have not notched up their already conservative behaviors in Q3 2013, but this could quickly change if the fiscal crisis continues to drag on. In the meantime, the following range of shopping behaviors remains pervasive among households with kids in particular. Since this is one of the largest CPG purchasing segments, marketers need to keep a watchful eye on this group’s attitudes and behaviors, IRI suggested:
- 64% are cutting back spending on non-essential items;
- 54% are trying new brands priced below regular brands;
- 52% are looking for products that treat multiple symptoms when buying over-the-counter medications to eliminate need to purchase multiple medications;
- 45% are shopping multiple stores to find the lowest prices; and
- 40% are using online resources to find coupons.
Meanwhile, IRI’s Shopper Sentiment Index provides insight into how the economy is impacting consumers and changing how they approach grocery shopping. With a benchmark score of 100 based on Q1 2011 information, a Shopper Sentiment Index score of more than 100 reflects consumers who are less price driven, more loyal to favorite brands and better equipped to maintain their desired lifestyle without changes.
The latest index for Q3 2013 is 109, which is an increase from 106 in Q2 2013. Overall, millennials and those ages 55 years and older are leading the way with their sunny outlooks. Millennials indexed at 100 in Q3 2013 versus 94 in Q2, and those agea 55 years and older indexed at 117 in Q3 2013 versus 112 in Q2. Unfortunately, those ages 35 years to 54 years took on a slightly dimmer view in Q3 2013 and indexed at 105 versus 109 in Q2.
“These overall positive results of the Shopper Sentiment Index are certainly an interesting juxtaposition to consumers’ concerns about the financial crisis,” Viamari said. “Economists are definitely trying to figure out if the current anxiety will turn into a big economic downturn or if these fears will be just a blip in consumer sentiment that will go away when the government reopens," she said. “There are so many balls in the fiscal air that consumer sentiment could easily be tracked not only daily but hourly. And, if the debt ceiling is extended for six weeks, we could be in for yet another crisis during the crucial holiday shopping season. The bottom line is that consumers have weathered many crises during the past months and years, so it will be very telling to see the results of IRI’s Q4 2013 MarketPulse survey and Shopper Sentiment Index to truly uncover how consumers handled the latest wave of events.”
The survey was fielded to consumers between Sept. 27-Oct. 3 and covers the days leading up to the government shutdown and after the shutdown began.
Majestic Drug executive graduates from National Hispana Leadership Institute’s Executive Leadership Program
SOUTH FALLSBURG, N.Y. — Majestic Drug on Tuesday announced the recent graduation of Nilda Oyola, VP sales, from the National Hispana Leadership Institute’s Executive Leadership Program.
The National Hispana Leadership Institute has helped hundreds of Latina leaders through its Executive Leadership Program that targets mid-career professional Latina women. The program addresses skill development and provides training and support through both a female and a Hispanic cultural lens.
“I am honored that the NHLI selected me to participate in this outstanding leadership program," Oyola said. "I left it energized and inspired. I cannot wait to apply what I have learned to both my position at Majestic as well as my Hispanic community."
"We are pleased to have provided Nilda with the opportunity for success,” commented Majestic president Larry Fishman. “Having worked with Nilda over the past 26 years, I can say that the best is yet to come."
Former Unilever, Revlon exec takes helm at direct sales company Jafra Cosmetics
LOS ANGELES — Beauty company Jafra Cosmetics International, which has 550,000 worldwide independent consultants, has named seasoned Brazilian global executive Mauro Schnaidman as president and CEO.
His experience has spanned various industries and has extended across several continents. From his early executive days at Pepsi and Unilever, to his management roles within Revlon and AOL, to his most recent position as president of Sara Lee Coffee and Tea Southern Europe, Schnaidman has contributed to expansion and growth within leading companies in Latin America, the United States and Europe.
Schnaidman, who is now based in Jafra’s U.S. headquarters, will work to help strengthen Jafra’s commitment to offering beauty products and an opportunity for women to become entrepreneurs in 18 countries worldwide, the company stated.
In 2004, the privately held Jafra joined the Vorwerk Group, a German-based international direct sales company. Jafra has a worldwide product portfolio that encompasses skin and body care as well as spa products, color cosmetics and fragrances.