Supermarkets not doing enough to help us, say cash-strapped shoppers

This article is brought to you by Retail Technology Review: Supermarkets not doing enough to help us, say cash-strapped shoppers.

Aldata Solution, provider of retail and distribution improvement software, has reveals growing public discontent with UK grocery retailers. According to the research, almost two thirds (64%) of shoppers do not believe that retailers have done enough to reduce the cost of their weekly shop. According to Aldata's annual survey of 1,000 consumers, the older population (55+) felt most strongly about this, with 70% perceiving retailer support as disappointing; a surprising finding amongst a portion of the population usually most brand-loyal, compared to only 55% of the 18-34 age group.

 
"Retailers need to find more ways to support their shoppers," says Mark Croxton, Head of Global Customer Support, Aldata. "This doesn't necessarily mean slashing prices, but with the cost of living rising by 4.8% since 2010 and over 40% of food and drink manufacturers expecting to raise prices further in 2012, retailers which are perceived as unhelpful will suffer as purse strings tighten. Indeed, 28% of British shoppers admit to buying less because of rising prices, so the threat of lower profits for retailers is very real."
 
"In present economic hard times, food shoppers have developed an 'eagle eye' when it comes to what their local supermarkets are offering; they are weary of supermarket hype and are more alert and on their guard," said Donna Dawson, behavioural psychologist. "Older shoppers in particular, who prefer to shop in the same store for convenience, are more able to track what that store is doing - and so it is no coincidence that they are the most disappointed consumer group. Today's customers are not only looking for value-for-money, they are also seeking the freedom to purchase as they see fit, and not be railroaded by various supermarket schemes. In general, customers are now more willing to change their habitual approach to their weekly food-shop; a fact that supermarkets ignore at their peril. And they are willing to protest what they see as a lack of support by buying less, buying differently, or buying elsewhere."
 
The survey revealed changing shopping patterns in the UK today, with 42% of younger shoppers more likely to turn to value ranges, showing little loyalty to well-known brands. Over a third of shoppers admit that they will go to several stores to get the best prices for their goods although older shoppers are still focused on convenience over cost, with 22% of over 55s (compared to 14% of 18-34s) stating that they will keep going to one supermarket to get all their shopping in one place.
 
"Unless supermarkets and smaller food retailers have real insight into the pressures which affect shoppers and offer tailored assortments and solutions that they perceive as valuable, customer loyalty will be affected and sales could drop significantly during 2012," continues Croxton. "Many retailers have already taken solid steps, but consumer perception is that they haven't gone far enough. Constantly re-evaluating these promotions and responding quickly to trends will be crucial to success this year."
 
These findings were replicated in France and Germany, with 33% of shoppers in both countries visiting several stores to find the best prices. 44% of Germans admit to switching to value ranges when cash is tight and a third of shoppers in France (33%) also taking advantage of loyalty cards and promotions to save money. In the US, approximately half (48%) admitted to having turned to generic or 'own brand' labels to cut spending during 2011.

"Current economics mean cash is critical," concludes Croxton. "Promotions have led to a more cynical and cautious shopper. What is interesting is that shoppers are now equating loyalty schemes with ways to reduce the cost of their regular shop. The reality for the retailer is that tracking customer change is key; understanding the demographic of the store and how you serve that shopper community and adjust that offer to serve your customer better. Using insight to drive your whole supply chain and assortment planning at the store level has never been more vital."
 
Other Key Findings
The survey also revealed other findings for daily and weekly shopping in the UK, including:

• Promotion Confusion: 37% spent time working out if retail promotions ultimately benefit them, to calculate the best arrangement of goods for them
• Bundle Avoidance: Shoppers dislike 'bundled' offers: 44% wished that they could purchase products at a low price, rather than being forced into BOGOF and similar offers; a sentiment which was higher in the male population.
• Smart and Loyal: 42% of the survey expressed appreciation for tailored promotions and deals to cut their weekly costs