growth channels & the impact on checkout categories november 2012 [email protected]...

Growth Channels & The Impact On Checkout Categories

November 2012

[email protected]

Twitter: BryanRoberts72

www.kantarretailiq.eu

© Copyright 2012 Kantar Retail

Shoppers Driving Discounter & Online GrowthDiscounters and online to drive growth

Source: KantarRetailIQ.eu

€1,951

€1,548

€1,357

*Chains: Data represents the over 500 European retail chains that Kantar Retail tracks and forecasts, generally these are chains with annual turnover exceeding EUR 1 billion

2


The Impact of ‘Where’

3

Within global grocery, smaller stores are winning

2,700

2,720

2,740

2,760

2,780

2,800

2,820

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Average Store Size


Big Boxes Not a Great Deal of Fun in Mature Markets

4

Source: Carrefour


Reasons for the Big Box Decline

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Non-food lines available through price-competitive online channels

Better service-led offer from specialist retailers

Some categories (music, DVD, gaming) are transitioning to non-physical delivery/consumption

Economic pressures are impacting discretionary spending/non-food demand

Shoppers are less willing to devote time travelling to out-of-town stores or navigating a 10,000 square metre store


Reasons for the Big Box Decline

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Rising numbers of grocery trips are transitioning to online/Drive

Aging populations less amenable to big box experience

Petrol prices making out-of-town travel more expensive

Decline in meal planning/large basket trips

Reluctance from shoppers to invest in household inventory


7

This Trend is Bad News for the Hotzone


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Other Checkout Trends are Equally Dispiriting 64% of self-checkout grocery

shoppers said retailers who offer self-checkout options provide better customer service

78% of self-checkout users prefer them because they are faster

Certain impulse items can be found in 5% of baskets processed through regular checkouts, but in only 2% of self-checkout baskets

Source: NCR; Kantar Retail


The Lure of Proximity – the Shopper

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Urbanization Longer working hours – little & often trips Rising petrol prices Growth in out-of-home food & drink Decline in home meal planning Decline in pantry/trolley shopping

-e.g. average of nine grocery shopping trips per household per week in the UK


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This Trend is Also Bad News for the Hotzone


Rapid Discount Growth Creates Issues

Fewer checkouts than supers & hypermarkets

Skew towards PL at checkout

Historically poor at impulse / checkout shopper marketing

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– Aldi has installed branded confectionery / gum

Some Signs of Progress …


Explosive Growth of Online is a Worry

Shopper marketing less advanced online Lack of impulse / adjacency Compete: 32% of shoppers prefer online, as it

removes temptation Few retailers successfully recommend linked items Trip disruption!

- Example: Ocado theoretically removes six million shopping trips per year from the UK market

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Some Positives Though Non-food click & collect will drive

traffic Smaller stores increasingly part of

the multichannel solution Pick-up points often at impulse-

heavy check-outs 70% of pick-up shoppers make in-

store purchase

Increasing use of pick-up lockers by the likes of Amazon

Likely to drive footfall into impulse-rich c-stores, CTNs & drugstores


Now What?

Acknowledge that hypermarket traffic will be stagnant or declining in many markets: perhaps consider devoting more shopper marketing resource to other channels

Develop counter-top merchandising solutions for smaller stores

Improve abilities to develop FSDUs for use in proximity stores

Clip-strips—when executed correctly—are excellent for creating impulse in the small store environment

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Create merchandising solutions for queuing areas for both regular and self-checkouts

Implement an impulse strategy for the discount channel—FSDUs and checkout displays are options here

Collaborate with retailers to create impulse/adjacency in the online environment

Development of merchandising solutions for Click & Collect pick-up points?

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Now What?


Monitor the implementation of Amazon Lockers – will there be greater impulse opportunities at Amazon’s retailer partners?

Consider on-screen impulse merchandising for self-checkouts

Work with retailers and/or self-checkout vendors to develop merchandising solutions for self-checkout units

Create smartphone marketing strategies to anticipate the adoption of smartphone self-scanning by more retailers/shoppers

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Now What?

growth channels & the impact on checkout categories november 2012 [email protected]...

Documents

kantar retailreasons

ncr kantar retail copyright

kantar retailshoppers

kantar retail tracks

kantar retailthe impact

winning copyright

hotzone copyright

chart data range