nielsen store choice value report dec07

5/14/2018 Nielsen Store Choice Value Report Dec07 - slidepdf.com

http://slidepdf.com/reader/full/nielsen-store-choice-value-report-dec07 1/10

January 2008

Grocery StoreChoice & Valuefor Money

A Global NielsenConsumer Report



1

2

The new rules or retailing success – Perception, Selection,Location

The rules o the retailing game seem to be changing dramatically

as consumers re-evaluate their criteria or choosing the stores

they spend their money in. According to a recent surveyconducted by The Nielsen Company, the ‘Location, Location,

Location’ mantra used by retailers as the critical success actor

may need to be revised. Globally, consumers have revealed

that Good Value or Money is now the most important actor

in determining where they buy their groceries.

Nielsen ound an overwhelming eighty-ve percent o theworld’s consumers ranked Good Value or Money the most

important consideration when choosing a grocery store, with

the most avid value-seekers hailing rom the Philippines,

Singapore, Portugal, Germany, India and Austria.

Conducted twice-a-year among 26,486 internet users in 47

markets rom Europe, Asia Pacic, the Americas and the Middle

East, Nielsen most recently surveyed consumers on the actorsthat infuenced their choice o grocery store. In addition to

Good Value or Money , the Nielsen survey asked consumers

to rank the relative importance o a number o other eatures,

including: Better Selection o High Quality Brands and Products;

the Closest Location; the Most Convenient/Easy Parking; and the

use o Recyclable Bags and Packaging.

Global consumers vote “good value for money”

#1 infuencer o grocery store choiceFive in six shoppers claim good value more important than range, location,

convenience & environmental friendliness

4.32

3.783.53

3.2

2.71

Good value

for money

Better selection

of high qualitybrands and products

The one

closest

The most

convenient/easyparking

Uses recyclable

bags andpackaging

Base: All respondents

On a scale o 1 (low) to 5 (high), how important are theollowing actors when you are deciding where to do yourgrocery shopping? - Global average (point score)

4.57 4.564.54

4.52 4.524.5 4.5 4.49 4.49 4.48

P hi li pp in es S in ga po re P or tu ga l G er ma ny I nd ia A us tr ia S ou thAfrica

M al ay si a T ur ke y I ta ly


On a scale o 1 (low) to 5 (high), how important are theollowing actors when you are deciding where to do your grocery shopping? - Top 10 Good value or money(point score)



2

3

Location is still important

Where you retail is still o critical importance but only rom a

market selection perspective; the ndings clearly suggest thatthe rules o the retailing game changed depending on where you

retailed. For instance, the Nielsen survey ound that Malaysian

shoppers preer supermarkets with the most convenient/easy

parking, South Koreans, Indonesians and Germans like the

supermarket closest to them, Russians and Indians seek out

supermarkets oering a better selection o high quality brands

and products, while Filipinos and Singaporean top global

rankings or placing most importance on getting good value or

money.

This unique global snapshot o shopping habits and the changing

motivations behind grocery shopping behaviour adds greaterdimension to what shoppers demand rom grocery retailers

today. These important dierences in shopper preerences

across regions and countries are likely to have a signicant role

in determining retailer success with the increasing consolidation

and globalization o the retail industry.

The second most important attribute or the world’s shoppers

was a retail outlet that oered a Better Selection o High Quality

Brands and Products. These results chart the evolution o the

grocery shopper as well. Today’s shopper appears to be what

retailing pundits aptly reer to as “The schizophrenic shopper”

- shoppers that expect the best o both worlds rom retailerstoday. On the one hand, shoppers are inclined to be bargain

hunters and demand good value or their grocery dollar, and on

the other, they also expect retailers to stock a wide selection o

high quality brands. This ‘dual demand’ indicates that the same

consumers want the ‘cheapest o the cheap’ in some categories

and the ‘best o the best’ in others.

Ranking highest or choosing a supermarket that oers a ‘Better

Selection o High Quality Brands and Products’ were consumers

in the world’s booming economies o Russia (93%), India (79%)

and China (78%) as well as the emerging Baltic countries o

Latvia (78%) and Lithuania (77%) – sending a clear message to

retailers operating in or entering those markets.

4.23.97

3.81 3.733.53

3.78

EEMEA Latam Asia Pacific North America Europe Global Average


On a scale o 1 (low) to 5 (high), how important are theollowing actors when you are deciding where to do yourgrocery shopping? - Better selection o high quality brandsand products (point score)

4.62

4.23 4.2 4.15 4.15 4.13 4.1 4.05 4.04 4.02

R ussia Ind ia China Latvia L ithuania U AE Phi lipp ines V ietnam S outhAfrica

Chile


On a scale o 1 (low) to 5 (high), how important are theollowing actors when you are deciding where to do yourgrocery shopping? - Top 10 Better selection o high qualitybrands and products (point score)



1

4

Evidence that refects dierences in shopper preerence

across countries is mounting. For instance, oreign retailers

looking to enter the emerging Baltic markets would be well

advised to consider the act that local consumers don’t react

to promotions and price discounts as much as other countries.

Instead, brand reputation, quality and buying habits are more

important. Earlier this year, Nielsen’s ShopperTrends survey or

the Baltics revealed that consumers are only inclined to buy

promotional items when they already like and trust a brand

– price promotions and discounts are simply not enough to

attract shoppers to a specic retailer in a highly competitive

and concentrated retailer environment.

As large numbers o consumers in ast-growing, emerging

markets, see their disposable incomes rise and attain newly

acquired, discerning tastes, they seek premium international

grocery products in their shopping baskets and head to

supermarkets with a better oering o high quality, branded

products. Typically, this orms the underlying basis or the

high degree o correlation between an increase in per capita

Gross Domestic Product and an increase in the share o market

that goes through the Modern Trade, i.e. Supermarkets and

Hypermarkets.

Access and Ease - still important but no longer the only

dierentiatorsIn a world where all retailers choose locations that are

accessible and convenient to travel to in terms o parking and

related amenities, location ceases to be the only dierentiator

and is now less important than ‘value or money’ and ‘selection

o high quality products and brands’.

Choosing a supermarket because it’s close to where they live

(Location) - and Convenient/Easy Parking ranked third and

ourth in importance on the Nielsen list. The Closest store was

most important to EEMEA and Asia Pacic consumers, and o

least importance to Europeans.

What ‘Good Value’ means to consumers - The Price,Promotion and Perception triple play

With consumers becoming more dicult to read, the way

in which they dene notions such as ‘Good Value’ becomes

critically important or retailers to understand. For those

consumers who claimed Good Value as their most important

consideration, Nielsen went on to ask how they dened it.

Their answers revealed that creating the image o ‘Good Value’

or a retailer would entail employing the triple play strategy

o Price, Promotions and Perceptions to attract consumer avor

over other retailers.

Price and Promotion - The importance o giving shoppers a

good ‘deal’

O those consumers who rated “good value or money” as very

or quite important when deciding where to do their grocery

shopping, three in our said it was important that a supermarket

ran a lot o promotions and regular price discounts, and seventy

percent said it was important the store had a reputation or

being cheaper than competitors - even i, in reality, this was

not the case. In third place was prices published in the store’s

own leafets, ollowed by I research and compare prices acrossretailers, price reductions oered through loyalty/store cards and

stores that promised to have every day low prices.

3.72 3.62 3.58 3.48 3.45 3.53

EEMEA Asia Pacific Latam North America Europe Global Average


On a scale o 1 (low) to 5 (high), how important are theollowing actors when you are deciding where to do yourgrocery shopping? - The one closest (point score)



2

5

Again, regional and country dierences prevailed. European

shoppers rated stores that run a lot o promotions and regular

price discounts and that have a reputation or being cheaper as

the two best indicators o Good Value.

Asia Pacic shoppers who rated “good value or money” as

very or quite important when deciding where to go grocery

shopping dened prices published in the store’s own promotional

material and the stores’ promise to have every day low prices as

their most important Good Value indicator. Asian shoppers

were also most likely to research and compare prices acrossretailers (although over three quarters o Turkish, Brazilians,

Polish and Portuguese consumers say they also research and

compare prices). Asians are also most likely to listen to word-

o-mouth and riends who tell them where to get the best value.

Shoppers in EEMEA and Europe were most likely to believe that

price reductions through store/loyalty cards are Good Value.

Promotions and regular price discounts appealed most to

bargain-hunters. Nearly ninety percent o Portuguese and

Taiwanese shoppers said they shopped in stores which oered

promotions and price discounts. Over eighty-ve percent o

Malaysian, Singaporean and Brazilian shoppers agreed with

them.70%

62%

60%

57%

57%

54%

50%

75%The store runs a lot of promotions and regular price discounts

The store has a reputation for being cheaper than theircompetitors

The prices published in the store's own leaflets, flyers, etc

I research and compare prices across retailers

Price reductions the retailers offer their Store card holders

The store promises to have every day low prices

The store carries a lot of Private Label products that arecheaper

Friends tell me where to get the best value

Base: Those rated “good value for money” as very or quite important when deciding where to do grocery shopping

In deciding what stores oer good value or money,how important are the ollowing - Global average (Veryimportant/Somewhat important)

82% 80%74%

71%67%

75%

Europe Asia Pacific EEMEA North America Latam Global Average


In deciding what stores oer good value or money, howimportant are the ollowing - The store runs a lot o

promotions and regular price discounts (Very important/Somewhat important)

89% 89% 87% 87% 86%82% 82% 81% 81% 80%


P o r t u

g a l

T a i w

a n

M a l a y

s i a

S i n g a p o

r e B r

a z i l

H o n g

K o n g

P h i l i p

p i n e s

G r e e c e

N e t h

e r l a n d s

P o l a n

d

In deciding what stores oer good value or money, howimportant are the ollowing - Top 10 The store runs a lot opromotions and regular price discounts (Very important/Somewhat important)



1

6

Interestingly, there are some consumers who are not attracted

to promotions and regular price discounts. One in our (22%)

Finnish shoppers said price promotions and discounts were not

important and the emerging European economies o Russia,

Hungary and Estonia shared the view.

The reasons or this can sometimes relate to a market’s maturity

and the evolution o its media. In Russia’s urban centers or

instance, retail and media trade are both highly ragmented and

it’s dicult or consumers to receive and access inormation

on price discounts and promotions. This creates a situation

where Russian shoppers aren’t interested in promotions and

regular price discounts due to a lack o awareness simply

because advertising and promotional channels are still under-

developed.

Reputation - ‘Good value’ is a matter o the mind

A store’s reputation or being cheaper than their competitors was

the second most infuential actor in what constitutes Good

Value in consumers’ minds. The power o perception is very

important – especially among South East Asian shoppers. Ninety

percent o Filipinos and over eighty percent o Singaporeans,

Indonesians, Malaysians and Taiwanese are infuenced by price

perception, along with eighty-two percent o Greeks and three

out o our Irish and Spanish shoppers.Interestingly, least concerned about a store’s price perception

as being cheaper were the Danish, Finnish and German

consumers.

Other elements o Value – In-store activity, price

comparison, loyalty cards and Everyday Low Prices (EDLP)

Adding urther insight into global shopping habits, sixty-two

percent o consumers said they were infuenced by prices

published by supermarkets in their own in-store promotional

material.

90%85% 84% 82% 81% 81% 79% 78% 78% 77%

Philippines Singapore Indonesia Greece Malaysia Taiwan Mexico India UAE Chile


In deciding what stores oer good value or money, howimportant are the ollowing - Top 10 The store has areputation or being cheaper than their competitors (Veryimportant/Somewhat important)

71%67%

61% 59%

48%

62%

Asia Pacific Europe EEMEA North America Latam Global Average


In deciding what stores oer good value or money, howimportant are the ollowing - The prices published in thestore’s own leafets, fyers, etc (Very important/Somewhatimportant)



2

7

Four in ten global consumers take matters into their own hands

and ensured they got good value by researching and comparing

prices across retailers. This was an important task or the Turks

(84%), Filipinos (79%), Brazilians and Poles (78%) and the

Portuguese and Thais (77%).

Over seventy percent o shoppers in Taiwan, Hong Kong andPhilippines recognize value or money through price reductions

oered through store/loyalty cards and they are also considered

an important “good value” item or the Portuguese (71%), Turks

and Lithuanians (68%).

Seventy percent o US shoppers who rated “good value or

money” as very or quite important when deciding where to go

grocery shopping rank a store that promises to have everyday

low prices as an indicator o Good Value.

This is supported by other Nielsen research in the USA that

shows the importance o good value and low prices resonates

much more with lower income households. More afuent

households, on the other hand, regard quality o resh produce,

meat and seaood and selection above good value. Despite

this, the success o warehouse club retailers also points to the

importance afuent consumers place on Value as well.

84%79% 78% 78% 77% 77%

74% 74%71% 71%

Turkey Phi lippi ne s Brazi l Pola nd Por tugal Thail and Greece Hong K ong Indonesi a Russi a


In deciding what stores oer good value or money,how important are the ollowing - Top 10 I research andcompare prices across retailers (Very important/Somewhatimportant)

75% 73% 73% 71%68% 68% 67% 65% 65% 65%

Taiwan Hong Kong Phil ippines Portuga l Turkey Lithuania Finland France M alaysia Russi a


In deciding what stores oer good value or money, howimportant are the ollowing - Top 10 Price reductions theretailers oer their Store card holders (Very important/

Somewhat important)

71% 70% 69% 69% 68%65% 65% 65% 64% 63%

Philippines US UK Egypt Singapore Ireland SouthKorea Malaysia NewZealand Australia


In deciding what stores oer good value or money, howimportant are the ollowing - Top 10 The store promisesto have every day low prices (Very important/Somewhatimportant)



1

8

Private Label – preerred by the public

While one in two global consumers (54%) say that “Good

Value” means a supermarket would oer a wide range o

cheaper priced Private Label products, Europe clearly remains

the leading global region or this ast growing and popular

sector. Greeks (82%), Germans (78%), Portuguese (77%)

Italians and Spanish (72%) consumers say it’s important or

them that a store carries a lot o Private Label products that

are cheaper.

In the global Nielsen survey, nine out o the top ten countries

who place the highest importance on a Private Label range hail

rom Western Europe where the well established private label

category is worth over twenty-percent o FMCG sales. It isworth noting, however, that in countries where a small number

o retailers have a high market share, the critical mass exists to

develop Private Label urther.

65%

52%49% 48% 46%

54%

Asia Pacific Europe EEMEA North America Latam Global Average


In deciding what stores oer good value or money, howimportant are the ollowing - The store carries a lot oPrivate Label products that are cheaper (Very important/Somewhat important)

82%78% 77%

72% 72% 71% 70% 69% 67%

59%


G r e e c e

G e r m

a n y

P o r t u

g a l

I t a l y

S p a i n

A u s t r i a

N e t h e r l a n

d s

F r a n c e

P h i l i p

p i n e s

S w i t z e r l a n

d

In deciding what stores oer good value or money, howimportant are the ollowing - Top 10 The store carries a loto Private Label products that are cheaper (Very important/Somewhat important)



2

9

About The Nielsen Company

The Nielsen Company is a global inormation and media

company with leading market positions in marketing

inormation (ACNielsen), media inormation (Nielsen Media

Research), online intelligence (NetRatings and BuzzMetrics),

mobile measurement, trade shows and business publications

(Billboard, The Hollywood Reporter, Adweek ). The privately

held company is active in more than 100 countries, with

headquarters in Haarlem, the Netherlands, and New York, USA.

For more inormation, please visit, www.nielsen.com.

About ShopperTrends

ShopperTrends, a service o The Nielsen Company oers in-

depth and complete analysis o the changing behaviour o

shoppers in over 50 markets globally. It provides inormation

on where, when and how oten people visit dierent outlet

types, how they perceive the key retailers, and provides insights

into key aspects o shopping behaviour.

About the Global Online Consumer Survey

The Nielsen Global Online Consumer Survey is conducted twice

a year to gauge consumer attitudes and opinions to a variety o

topics and current aairs. The April 2007 survey was conducted

in 47 Markets: Argentina, Australia, Austria, Belgium, Brazil,

Canada, Chile, China, Czech Republic, Denmark, Egypt, Estonia,

Finland, France, Germany, Greece, Hong Kong, Hungary,

India, Indonesia, Ireland, Italy, Japan, Korea, Latvia, Lithuania,

Malaysia, Mexico, Netherlands, New Zealand, Norway,

Philippines, Poland, Portugal, Russia, Thailand, Singapore, South

Arica, Spain, Sweden, Switzerland, Taiwan, Turkey, UAE, United

Kingdom, US and Vietnam. The margin o error o the survey is+/- 4% or n=500 and +/- 3% or n=1000.

nielsen store choice value report dec07

Documents