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M A R C H 7 , 2 0 11

FOOD SHOPPING SHIFTS Here are the trends in food retail that will define the future of the category. These trends will challenge “classic” channels and manufacturers; and embolden others to seize the opportunity.

© A L L R I G H T S R E S E R V E D 2 0 11


FOOD AVAILABLE EVERYWHERE IMPACTS SHOPPERS

SANDWICHES @ DUANE READE

FRESH FOOD @ TARGET

Compared to a few years ago, 3/4 are noticing food being sold in more different stores and 1/2 say they are actually buying food in more places -- especially 18-34 year olds and Hispanic Shoppers. (SEE APPENDIX TABLES 1A) TOTAL January 2011 1504

18-34

35-54

55+

Caucasian

Hispanic

441

584

479

1006

200

African American 198

% Notice food being sold in more places

77

75

76

80

75

80

82 E

% Buy food in more places

49

59 CD

49 D

41

45

60 E

54 E

Base: Total Respondents

A %

AGE

B %

C %

ETHNICITY

D %

E %

F %

Q: Have you noticed that food products are sold in more different types of stores today compared to a few years ago? Q: Are you buying food in more stores compared to a few years ago? FOOD SHOPPING SHIFTS | MARCH, 2011

2

Š ALL RIGHTS RESERVED 2011

G %


SHOPPERS ACT ON THEIR PRIORITIES What shoppers notice (or look for) partially reflects their priorities, but a solid 2/3 like what they see in the food stores they shop. (SEE APPENDIX TABLES 2A,3A)

»! Noticed most heavily by 70%-73% of shoppers was expanded selection of store brands and organic/natural food. »! 73% notice, and almost all like, the increased visibility of nutritional information. »! Over half (56%) noticed more specialty food stores opening and 1/3 notice smaller supermarket formats – 2/3 like both. »! New store services (i.e. reporting the origin of fresh foods and health-ratings) are noticed early by nearly half of shoppers, and ! already find them appealing. »! Fewer notice improvements in customer service (40%), but everyone (89%) wants a pleasant experience.

3 © ALL RIGHTS RESERVED 2011

FOOD RETAILING TRENDS

“I’VE NOTICED THIS”

“I LIKE THIS”

%

%

Expanded store brand selection in food

73

78

More visible nutritional information

71

86

70

62

64

74

56

63

49

82

42

74

41

80

40

89

More small supermarkets opening

34

69

Registered dietitians in aisles to answer questions

15

63

Base: Total Respondents (n=1504)/ Varies by trend noticed

Expanded selection of organic and natural foods Healthier options added by convenience and fast food chains (i.e. fruit, salad) More specialty food stores opening (i.e. Whole Foods) Stores letting you know where fresh food was grown Stores rating foods based on how healthy they are More food retailers supporting charitable or community causes Customer service in food stores is improving

Q: Which of the following have you noticed/liked about food stores? FOOD SHOPPING SHIFTS | MARCH, 2011


DEMO PREFERENCES SHAPE FOOD RETAIL FUTURES Young, Hispanic and African American Shoppers have unique attitudes and behaviors that will help shape the future of food retail:

(SEE APPENDIX TABLE 2A)

»! More 18-34 year olds already buy food in more places and notice and like smaller supermarket formats. »! More Hispanic and African American Shoppers already buy food in more places and notice and like dieticians in the aisles – satisfying their hunger for information to make healthier choices. »! Overall, more Hispanic and African American Shoppers noticed many of the features/services (SEE APPENDIX TABLE 2A) that support healthier eating.

4 © ALL RIGHTS RESERVED 2011

KEY DIFFERENCES BY AGE TOTAL

18-34

35-54

55+

A %

B %

C %

D %

% Buying food in more places (n=1504)

49

59 CD

49 D

41

% Noticing smaller supermarkets (n=1504)

34

47 CD

28

28

% Liking expansion of smaller supermarkets (n=511)

69

73 D

69

63

KEY DIFFERENCES BY ETHNICITY TOTAL

CAUCASIAN

HISPANIC

AFRICAN AMERICAN

A %

B %

C %

D %

% Buying food in more places (n=1504)

49

45

60 B

54 B

% Noticing dietitians in aisles to answer questions (n=1504)

15

11

23 B

24 B

% Liking dietitians in aisles to answer questions (n=226)

63

51

72 B

69 B

FOOD SHOPPING SHIFTS | MARCH, 2011


INSIGHTS TO ACTIVATE Here are the trends in food retail that will define the future of the category. These trends will challenge “classic” channels and manufacturers, and embolden others to seize the opportunity.

1.! Who owns food shopping? Many can. If ever you doubted that shoppers will buy anything

everywhere, this Food category report proves it. Half of all shoppers feel they are buying food in more places now than they were a year ago. This comes two weeks after the PULSE we published on Gift Cards, which showed the same results – as gift cards are sold in more places, more people buy them.

2.! Transparency will define trust for food retail. Transparency about where the produce is grown and the fish farmed is as important to shoppers today as good service.

3.! Nutrition guidance is a big win, especially with African American and Hispanic Shoppers. Over ! of all shoppers welcome nutrition counseling and guidance in food stores, but it becomes an even bigger opportunity with minority shoppers, who are the majority in many communities.

4.! Small store formats make modest gains. Small formats have been expanding, and 1/3 of shoppers have noticed. Many say they like them, but the size of the store is not as important as the transparency around food and nutrition.

5.! Store brands are popular. In the top 5 things shoppers have noticed, and like, is the expansion of retailers’ brands.

TO THE SMART EXAMPLES 5 © ALL RIGHTS RESERVED 2011

FOOD SHOPPING SHIFTS | MARCH, 2011


SMART EXAMPLES: KROGER & GIANT EAGLE »! Kroger’s private label produce, Fresh Selections, comes packaged with a 16-digit code so shoppers can trace the product’s origin, learn how it was grown, and where. These details can be accessed in-store with the HarvestMark mobile app, or on harvestmark.com.

»! Giant Eagle’s Market District format offers an instore nutritionist to help guide purchase decisions. It further supports healthy nutrition by offering a variety of free educational events such as “Tour of the Store” where shoppers can learn how to read food labels, shop for soy or Gluten free products.

T O T H E A P P E N D I X TA B L E S 6 © ALL RIGHTS RESERVED 2011

HOW AMERICA SHOPS® SMART MOVES & GOTTA SEE | 1Q 2011


APPENDIX TABLES TABLE 1

REACTIONS TO FOOD AVAILABLE EVERYWHERE

»! A: By Demographics »! B: By Retailer Shoppers

TABLE 2

FOOD RETAILING TRENDS (NOTICED)

»! A: By Demographics »! B: By Retailer Shoppers

TABLE 3

FOOD RETAILING TRENDS (LIKED)

»! A: By Demographics Only

7 © ALL RIGHTS RESERVED 2011

FOOD SHOPPING SHIFTS | MARCH, 2011


TABLE 1A: REACTIONS TO FOOD AVAILABLE EVERYWHERE TOTAL January 2011 1504

Men

Women

18-34

35-54

55+

<$50K

739

765

441

584

479

722

% Notice food being sold in more places

77

73

81B

75

76

80

78

% Buy food in more places compared to a few years ago

49

46

53 B

59 EF

49F

41

49

Base: Total Respondents

A %

GENDER

B %

C %

AGE

D %

E %

F %

G %

INCOME $50k$99K 566

ETHNICITY 216

1006

200

African American 198

75

77

75

80

82 J

49

52

45

60 J

54 J

H %

$100K+ Caucasian I %

J %

Q: Have you noticed that food products are sold in more different types of stores today compared to a few years ago?

8

© ALL RIGHTS RESERVED 2011

How America Shops® The PULSE of Shopping Life is based on national survey conducted in January 2011

Hispanic K %

L %


TABLE 1B: REACTIONS TO FOOD AVAILABLE EVERYWHERE TOTAL

IN THE PAST WEEK

IN THE PAST 3 MONTHS

MASS MERCH.

DRUG STORE

WAREHOUSE CLUB

DOLLAR STORE

SUPERMARKET

DEPARTMENT STORE

Total

Total JCP Macy’s Kohl’s

Total

WMT

TGT

Total CVS

WG

Rite Aid

1504

949

766

379

1079

182

272

90

574

166

216

907

142

105

1132

311

164

152

147

940

874

110

101

A

B

C

D

E

F

G

H

I

J

K

L

M

N

O

P

Q

R

S

T

U

V

W

X

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

%

% Notice food being sold in more places

77

79

80

78

79

75

81

76

81

78

83

81 OT

80

82

78

82

83

80

81

77

82 OT

87

78

82

% Buy food in more places compared to a few years ago

49

61 52 G 46

45

51

54

56

49

56 OT

48

49

50

52

65 OP

57

58

51

55 O 52

46

47

Base: Total Respondents

55 O 56

Total Costco Sam’s Total

Dollar Family SafeAlbertTotal Kroger Publix Gen. Dollar way son’s

ONLINE

Q: Have you noticed that food products are sold in more different types of stores today compared to a few years ago?

9

© ALL RIGHTS RESERVED 2011

How America Shops® The PULSE of Shopping Life is based on national survey conducted in January 2011

162


TABLE 2A: FOOD RETAILING TRENDS (NOTICED) TOTAL

GENDER

AGE

INCOME

ETHNICITY

January 2011

Men

Women

18-34

35-54

55+

<$50K

$50k$99K

1504

739

765

441

584

479

722

566

216

1006

200

198

A %

B %

C %

D %

E %

F %

G %

H %

I %

J %

K %

L %

Expanded store brand selection in food

73

70

76 B

66

74 D

78 D

73

74

70

75 K

67

72

More visible nutritional information

71

68

74 B

65

69

78 DE

72

69

73

69

76

75

Expanded selection of organic and natural foods

70

66

74 B

68

69

73

68

71

73

69

70

72

Healthier options added by convenience and fast food chains (i.e. fruit, salad)

64

61

68 B

66

64

64

66I

66I

56

63

64

74 JK

More specialty food stores opening (i.e. Whole Foods)

56

53

58

64 EF

52

52

55

54

62

51

62 J

70 J

Stores letting you know where fresh food was grown

49

48

50

52

46

48

48

49

50

47

52

50

Stores rating foods based on how healthy they are

42

43

40

47 EF

38

41

43

40

42

38

48 J

51 J

More food retailers supporting charitable or community causes

41

39

42

51 EF

37

36

41

40

43

36

54 J

46 J

Customer service in food stores is improving

40

41

39

43 E

36

43 E

43 H

37

39

35

50 J

53 J

More small supermarkets opening

34

36

32

47 EF

28

28

36 H

31

34

27

42 J

53 JK

Registered dietitians in aisles to answer questions

15

18C

13

26 EF

12

10

16

14

18

11

23 J

24 J

Base: Total Respondents

10 Š ALL RIGHTS RESERVED 2011

$100K+ Caucasian Hispanic

Q: Which of the following have you noticed about food stores?

How America ShopsÂŽ The PULSE of Shopping Life is based on national survey conducted in January 2011

African American


TABLE 2B: FOOD RETAILING TRENDS (NOTICED) TOTAL

IN THE PAST WEEK

IN THE PAST 3 MONTHS

MASS MERCH.

Total WMT

DRUG STORE

TGT

Total CVS

WG

1504 A %

949 B %

766 C %

379 D %

1079 E %

182 F %

272 G %

Expanded store brand selection in food

73

78

77

77

75

70

78F

More visible nutritional information

71

73

74

75

73

69

Expanded selection of organic and natural foods

70

74

73

79 C

74

64

69

68

69

68

56

59

Stores letting you know where fresh food was grown

49

Stores rating foods based on how healthy they are

Base: Total Respondents

WAREHOUSE CLUB

Rite Aid

SUPERMARKET

Dollar Family SafeAlbert Total Costco Sam’s Total Total Kroger Publix Gen. Dollar way -son’s

ONLINE

DEPARTMENT STORE

Total

Total JCP Macy’s Kohl’s

574 I %

166 J %

216 K %

907 L %

142 M %

105 N %

1132 O %

311 P %

164 Q %

152 R %

147 S %

940 T %

874 U %

110 V %

101 W %

162 X %

71

78

76

80

76

77

70

76

78

76

76

75

75

76

80

78

82

73

68

74

68

73

73

65

76

73

77

73

69

76

72

73

72

74

70

71

69

72

76

79

75

73

69

66

74

74

76

79

76

73

76

74

84 X

70

62

67

72

66

65

67

69

65

70

67

68

64

64

60

66

69

76

66

66

58

66 59 H 54 BC

56

47

61

62

56

56

51

58

58

60

63

62

64

56

60

58

69

59

49

50

49

49

43

46

49

52

48

49

50

51

43

50

53

52

53

56

50

53

55

52

52

42

42

42

41

42

38

42

42

44

37

44

44

45

50

41

42

41

42

45

41

41

43

39

43

More food retailers supporting charitable or community causes

41

42

42

46

41

35

43

34

42

36

40

42

40

48

41

43

43

47

44

40

43

37

43

39

Customer service in food stores is improving

40

41

42

41

40

36

38

44

40

36

40

42

44

34

39

43

45

45 48 O

39

41

46

46

39

More small supermarkets opening

34

33

33

38

33

32

31

33

35

31

33

34

36

34

32

37

37

37

39

33

33

33

34

27

Registered dietitians in aisles to answer questions

15

14

15

19 B

14

10

11

10

14

10

13

16

12

17

13

16

19

19

25 OP

14

16

9

Healthier options added by convenience and fast food chains (i.e. fruit, salad) More specialty food stores opening (i.e. Whole Foods)

11 © ALL RIGHTS RESERVED 2011

90 H %

DOLLAR STORE

Q: Which of the following have you noticed about food stores?

How America Shops® The PULSE of Shopping Life is based on national survey conducted in January 2011

15 X 18 X


TABLE 3A: FOOD RETAILING TRENDS (LIKED) TOTAL

GENDER

AGE

INCOME

ETHNICITY

January 2011

Men

Women

18-34

35-54

55+

<$50K

$50k$99K

1504

739

765

441

584

479

722

566

216

1006

200

198

A %

B %

C %

D %

E %

F %

G %

H %

I %

J %

K %

L %

Customer service in food stores is improving (n=602)

89

86

92 B

80

90 D

95 DE

87

91

89

89 K

81

92 K

More visible nutritional information (n=1067)

86

80

90 B

77

86 D

92 DE

82

88 G

90 G

86

83

90

Stores letting you know where fresh food was grown (n=737)

82

79

84

72

82 D

90 DE

81

80

87

81

79

85

More food retailers supporting charitable or community causes (n=617)

80

73

85 B

73

84 D

83 D

78

83

74

78

79

85

Expanded store brand selection in food (private labels) (n=1097)

78

78

79

78

78

78

79

78

76

78

79

85

Convenience stores and fast food chains offering healthy options (i.e. fruit, salad) (n=963)

74

67

80 B

69

73

78 D

74

73

75

71

80J

79 J

Stores rating foods based on how healthy they are (n=631)

74

71

77

64

77 D

81 D

72

75

77

73

74

76

More small supermarkets opening (n=511)

69

68

71

73 F

69

63

66

71

77

66

73

71

More specialty food stores opening (i.e. Whole Foods) (n=842)

63

60

67 B

63

66

61

62

64

68

59

66

73 J

Registered dietitians in aisles to answer questions (n=226)

63

61

67

57

68

72

59

65

74

51

72 J

69 J

Expanded selection of organic and natural foods (n=1053)

62

56

66 B

64

61

61

60

63

64

56

69 J

72 J

Base: Total Respondents

12 Š ALL RIGHTS RESERVED 2011

$100K+ Caucasian Hispanic

Q: Of the trends in food retailing that you noticed, which do you like?

How America ShopsÂŽ The PULSE of Shopping Life is based on national survey conducted in January 2011

African American


3 0 7 S E V E N T H AV E N U E S U I T E 1 7 0 7 NEW YORK NY 10001 P 212.924.7780

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F 212.924.7608

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I N F O @ W S L S T R AT E G I C R E TA I L . C O M

CONTACT PAUL MENICHELLI @ PMENICHELLI@WSLSTRATEGICRETAIL.COM FOR QUESTIONS OR ADDITIONAL INFORMATION ABOUT THIS RESEARCH

© WSL MARKETING INC.

A L L R I G H T S R E S E RV E D 2 0 11

/WSL_HAS_PULSE_Sample  

http://www.wslstrategicretail.com/downloads/WSL_HAS_PULSE_Sample.pdf

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