By Tom Ryan
According to a new survey by The Nielsen Company, frequent promotions and discounts was the most important factor to U.S. consumers when deciding which grocers offer the most value for their money.
Eighty percent of U.S. shoppers consider it "very important or somewhat important" for supermarkets to feature frequent promotions and price discounts, while 72 percent believe a store's reputation for delivering low prices is very to somewhat important. Ranking third are prices published in the stores' leaflets (71 percent) and everyday low prices (70 percent.) Slightly less important to U.S. consumers are discounts for store cardholders (63 percent), price comparison across retailers (59 percent), private label offerings (53 percent) and friends' recommendations (43 percent.)
"Our research shows that the importance of good value and low prices resonates much more with lower income households in the U.S." said Todd Hale, senior vice president of Consumer & Shopping Insights, Nielsen Consumer Panel Services, in a statement. "More affluent households regard quality of fresh produce, meat and seafood and selection above good value. That said, the success of warehouse club retailers speaks loudly to the importance affluent American consumers place on value."
Source: Nielsen
Overall, Nielsen found good value (cited by 60 percent) was by far the most important factor U.S. consumers look for in deciding where to grocery shop. That was followed by better selection of high quality brands and products, 28 percent; the closest store, 23 percent; most convenient/easiest parking, 14 percent; and uses recycle bags and packaging, nine percent.
With the exception of few regions, particularly the emerging European economies of Russia, Hungary and Estonia; Nielsen found similar shopper behavior patterns worldwide.
"What shoppers demand from grocery retailers varies significantly across regions and countries, and with increasing consolidation and globalization of the retail industry, it's crucial for retailers to understand how shopper preferences differ across markets," said Mr. Hale.
Discussion Questions: Are frequent promotions becoming a more or less important driver of the "value equation" for grocers? How is the overall value equation changing?