By George Anderson
Dollar stores are ringing up the dollars according to a new consumer report from Information Resources, Inc. (IRI), IRI Insights on Dollar Stores.
IRI estimates that the channel is generating annual sales of $12.5 billion as consumers increasingly turn to dollar stores for items once purchased in other formats.
Key findings of IRI's research include:
- Dollar stores captured three million new shoppers in the past year.
- More than 50 percent of the heaviest shoppers in other channels (food, drug, mass, etc.) also shop in dollar stores.
- Consumers are attracted to dollar stores for a combination of price and convenience factors.
- Dollar store shoppers are heavily influenced by deals and less brand loyal.
- HBC and food items are the fastest growing product categories in dollar stores.
|
Top 15 Category Growth Based on Spending Per Dollar Store Shopper |
||
|
Dollars Per Buyer |
% Change/Yr Ago |
|
|
Cold/Allergy/Sinus Tabs |
$7.97 |
157% |
|
External Analgesic Rubs |
$2.63 |
107% |
|
Internal Analgesics |
$6.43 |
100% |
|
Cold/Allergy/Sinus Liquid |
$4.68 |
76% |
|
Rug/Fabric Treatment |
$4.16 |
64% |
|
Denture Products |
$5.32 |
62% |
|
First Aid Treatments |
$1.94 |
56% |
|
Canned Meat |
$4.54 |
55% |
|
Salad Dressings |
$2.84 |
54% |
|
Gastrointestinal – Liquid |
$4.90 |
53% |
|
Frozen Meat |
$7.24 |
48% |
|
Cough Syrup |
$2.97 |
47% |
|
Mouthwash |
$4.94 |
40% |
|
Skin Care |
$8.05 |
39% |
|
Vitamins |
$12.23 |
38% |
|
SOURCE:
IRI Household Panel, 52 weeks ending June 30, 2002, |
||
Moderator's Comment: Are dollar stores drawing from a larger cross-section of consumers than is generally assumed? What are the growth prospects for the channel?
IRI's research seems to support this notion. Our view is simple. Consumers like to find deals regardless of their income bracket. Dollar stores, once found only in less affluent areas are now popping up in the same shopping centers as upscale grocers such as Kings and the drugstore giant Walgreen's. [George Anderson - Moderator]