Weary consumers want a less-challenging low-price hunt, and think less of frequent cardholder programs as they are now run.
The public is tired of holding tight to their household food budgets, even though most continue to do so. They want the quality and items they used to enjoy routinely. They also want to dispatch their shopping in fewer stops (chasing low prices in more stores takes time), and they expect these stops to be pleasant to visit.
The Lempert Report shares these insights, which stem from the dramatic seven-point shift away from ‘low prices’ as a primary determinant of where to shop for groceries, in the National Grocers Association-SupermarketGuru 2011 Annual Consumer Survey Report.
Current figures show just 44% of consumers think price is ‘very important’; this is down from 51% in each of the past two years. Indeed, today’s percentage reverts to the 2008 pre-recession sentiment level. That’s significant because this consumer frame of mind away from low prices is coming in advance of a full recovery.
This is good news for retailers that have refined their store appeals - because now they matter more. Correlating with this shift, nearly five out of ten respondents (49%) who say price is ‘very important’ come from the three lowest income tiers - $25,001-$45,000 (20%), $45,001-$65,000 (17%) and $25,000 or less (12%). A year ago, their collective percentage was 56%.
The household size that drove the ‘very important’ response was two people (38%); that’s about twice the rate of households with four (18%), one (18%) or three (17%), the data show.
Checking back with the 2003 report, food prices were the biggest reason people shopped at a particular store, but just 41% of respondents expressed this (Best everyday prices 30% and Best sale prices 11%). Today’s figures at last are pretty similar again.
More evidence of the low-price-chase fatigue.: While 92% of respondents say that ‘items on sale or money-saving specials’ are ‘very/somewhat important’ factors in where they decide to buy food, the composition of this figure has changed. ‘Very important’ downshifted to 55% from 60% a year ago, and ‘somewhat important’ rose three points to 37% from 34% a year ago.
Also, less than one-fourth of consumers (24%) think a frequent shopper program or savings club is a ‘very important’ differentiator. Perhaps if supermarkets ran more targeted promotions to their cardholders, these programs would be more in demand. As it is, this four-point dip from 28% last year signals that people want their savings and deals in a clear manner, without having to give up personal information or follow many rules.