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SymphonyIRI: Due to economy, 1-in-5 consumers choose a product tied to loyalty card discount

BY Michael Johnsen

CHICAGO — One-in-5 consumers between the ages of 35 years and 54 years are choosing products due to a loyalty card discount, SymphonyIRI Group reported Wednesday as part of its fourth quarter 2012 MarketPulse survey. And almost one-third are forsaking their preferred brands due to a sale price. The survey found that shopper sentiment dropped to its lowest point since Q3 2011. While consumers across all age groups feel the strain of ongoing economic strife, those ages 35 to 54 convey particularly gloomy attitudes, with 43% stating that their financial situation deteriorated in 2012. 

“Through quarterly analysis of two full years of MarketPulse data, we have consistently seen a solid representation of shoppers with a gray outlook on their financial health,” stated Susan Viamari, editor of Times & Trends, SymphonyIRI. “This sentiment remains very prevalent, especially for those aged 35 to 54, who are really influencing trends because they are in their prime earning and family-raising years. On top of today’s economic concerns, this age group also is thinking about college expenses and retirement. All of these pressures are converging to heighten their concern about their futures and leading the way on many conservative shopping strategies and money-saving behaviors, so marketers need to pay close attention to them.”

Launched in Q2 2012, SymphonyIRI’s Shopper Sentiment Index provides deep insight into how the economy is impacting consumers and changing how they approach grocery shopping. The Shopper Sentiment Index provides perspective in terms of price sensitivity, brand loyalty and changes in spending required to maintain desired lifestyles. 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 index illustrates that shopper sentiment took a noteworthy uptick in early 2012, with a sizable segment of the population beginning to anticipate sunnier skies ahead. But when brighter days failed to materialize, consumers’ concerns for their future financial health began to waver, and sentiment slid once again. Latest findings from the Shopper Sentiment Index reveal that overall sentiment dropped to 94 in Q4 2012 versus 99 in Q3. This is the lowest point since Q3 2011, and the decline was driven largely by the 35 to 54 age segment.

With 27% of 35 to 54 year olds, and 22% of consumers on the whole having difficulty affording regular groceries, it is no surprise that consumers across the board are maintaining their cautious approach to shopping. According to the survey:

  • 29% of consumers between the ages of 35 and 54 buy brands other than preferred because they are on sale;
  • 26% select products to create more meals at lower cost;
  • 22% choose products due to loyalty card discount;
  • 15% steer clear of certain aisles to avoid unplanned purchases; and
  • 37% use coupons to make lists.

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Nielsen: Retail opportunities for 2013 in big data, omnichannel and fresh

BY Michael Johnsen

CHICAGO — Growth in 2013 will be slow-going in the first half of 2013 but will pick up at the end, suggested James Russo, SVP global consumer insights for Nielsen, during a webinar Wednesday afternoon. "The consumer remains in maintenance mode," he said. "Consumers are being pragmatic in their spending. Uncertainty dominates."

Nielsen advised participants of its "What’s In Store 2013" webinar that the biggest bang for retailers and consumer packaged goods manufacturers will come out of thinking small. And to be really successful, companies will need to think at a granular level utilizing big data analytics.

Thanks to a still-anemic economy, the average size of an American household has dropped to 2.58 in 2011 from 2.62 in 2000, and the average number of annual shopping trips has dropped to 151 in the 2010-2011 time frame as compared with 176 average annual trips per shopper in the 2002-2007 time frame, or prior to the recession.

And as many as 74% of consumers claim the American economy isn’t recovering at all but still in a recession. 

To capture a greater share of dollar out of smaller households and fewer shopping trips, retailers and their partners will need to make the shopping experience more personal, Russo suggested, through insights derived from social media outlets and shopping data — big data.

Another area of opportunity for 2013 will be fresh, Russo said. In an outlet where fresh makes up 13% of the selling space, it can drive as much as 30% of the growth. Basketsizes in stores with fresh are between 1.5 and 2.1 times larger versus similar stores without fresh, and there has been a 5% increase in consumer interest around health and natural foods. "This is a global dynamic as well," Russo noted. 

Retailers also will need to reach their shopper where she’s actually shopping. "Last year there was a significant increase in virtual stores," he said, citing Peapod as an example. Peapod is an online grocer that presents virtual planograms — on the walls of a subway, for example — where commuters waiting for their train can scan a product with their smartphone and have it delivered to their home.

Consumers aren’t just shopping during their commute, however. "About half of consumers who are using their tablets and watching TV are shopping. So when you think of the connection between traditional media and new media, it’s [very] important." 

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Report: Shoppers want more buy-America options and Walmart aims to give it to them

BY Michael Johnsen

TYSONS CORNER, Va. — More than 80% of Americans are willing to pay more for Made in the USA products, according to a USA Today report published online late Monday night. 

Out of those shoppers actively seeking to buy all things American, 93% reported that they wanted to keep jobs in the U.S. as their primary reason for doing so, the report noted, citing a survey released in November by Boston Consulting Group.

The movement has even captured the hearts and minds of retailers. In conjunction with the National Retail Federation, Walmart U.S. president and CEO Bill Simon recently identified a three-prong strategy to help grow America’s economy — employ Americans, employ American soldiers especially and buy from American producers. Right now, 2-out-of-3 products sourced by Walmart come from domestic suppliers. Simon pledged that Walmart would spend $50 billion on U.S. products over the next 10 years .

 

 

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