Store switching looms: NGA-SG consumer study

A new store, sized right and nearby, is a significant competitive threat.

This is the first of five stories on The Lempert Report this week revealing some key findings from the National Grocers Association-SupermarketGuru 2013 Consumer Panel Survey.  The NGA Show is convening in Las Vegas, where our CEO Phil Lempert is presenting study insights to the nation’s independent grocers.

The recession taught more shoppers to shop more channels in search of the quality, value and deals that feel right to them.

Once more stores are on a shopper’s radar, how slippery is the slope to a full-out switch?  Pretty treacherous, it turns out, according to findings of the National Grocers Association-SupermarketGuru 2013 Consumer Panel Survey.  

The adage, ‘you’re only as good as your last performance,’ comes to mind.

We asked consumers across the country, “If a store in your preferred size opened nearby, and price/quality was about the same as where you shop now, would you switch?” More than one-quarter of the shopping public (26.6%) says they’d definitely switch and nearly half (49.0%) would at least try the new operator.   Most striking: the consumers willing to switch are nearly five points higher than the 22.0% who felt this way in 2011, though down a bit from last year’s 27.1%.  Leading the “definite switchers” are: the heaviest grocery spenders of $101 or more per week (28.2%), Millennials age 25-39 (30.9%), and the largest households of 5 or more (32.7%).

For three straight years now, more than half(55.8%) say the optimal store size for most food-buying trips is the 30,001-50,000 square foot format. No other size approaches this popularity. Supercenters with one-stop appeal and deep discounts also rise to 12.3% from last year’s 11.4%, which shows deal chasing is still alive. The compact fresh to go size inches up to 3.9% from 3.7% last year, despite Tesco’s recent decision to pull the plug on its U.S. format.

Nearly 3 out of 4 consumers (73.2%) say their primary supermarket feels “perfect”—practically the same as last year’s 73.8%.

Convenient location is also key:  Consistent with 2011 and 2012 studies, location is “very important” to 36.1% of consumers—though not as high as the 2010 recession level of 41.0% when few wanted to drive further to a store.  Today’s figure suggests any food retailer that is reasonably convenient has a chance to win trips. A supermarket in the heart of a neighborhood has no lock based on its address alone. More competitors are in play, and encroachment from drug, dollar, club, mass and c-stores always looms. The “somewhat important” figure dips to 55.2% in 2013 from 56.9% last year.

An overwhelming 94.5% of consumers call their primary supermarket convenient to where they live or work. This year’s “excellent” rating (58.1%) dips from 59.5% last year, but is still higher than 2011’s 56.0%. 

Other factors affect switch decisions. Chief household shoppers have a checklist that includes:  Do stores offer enough nutritional guidance and better-for-my-family foods? Are stores easy to navigate and convenient? Does the place look, smell...sing...fresh? Is shopping there an upbeat experience of new taste discoveries? Are food values and savings in place and highly visible? Is private label great in its own right, not just less costly? Are enough experts available (butchers, cheese mongers, nutritionists, deli chefs) to help shoppers serve great meals at home that satisfy and support our household wellness? Do shoppers feel welcome and appreciated?

SupermarketGuru.com conducted a national consumer panel online between October and November 2012 for NGA. In all, 2,299 chief household shoppers completed surveys that detailed their experiences, behaviors and sentiments on what does or doesn’t appeal to them about supermarkets, as well as their purchase influences, eating habits and nutritional concerns.