Shopper Traffic and Shopping Frequency Down Across Food, Drug and Mass Channels; Trading Down Benefits Value Formats TNS Retail Forward Reports

Shopper traffic and shopping frequency is down across most food, drug and mass channels

COLUMBUS, Shopper traffic and shopping frequency is down across most food, drug and mass channels—except supercenters, which is being driven by an increase in monthly shoppers at Walmart Supercenter. Tighter household budgets—due to a variety of factors including food price inflation, concerns about job security and declining home values—are altering the shopping behavior of consumers, TNS Retail Forward ShopperScape™ research indicates.

“Shoppers are rethinking how and where they shop for food and are limiting spending to non-discretionary purchases of groceries and other household essentials,” comments Kelly Tackett, Senior Consultant at TNS Retail Forward and author of the recently published Retail Forward Intelligence System™ report, Shopper Update: Food Drug Mass Shopping Frequency. “Others are trading down to value-oriented formats such as dollar stores, extreme-value grocers and Walmart Supercenter,” she adds.

As the perception of value becomes increasingly important and the number of value-conscious shoppers seeking out retailers where they can realize the most cost- and time-savings across their whole shopping list grows, the low-price leader Walmart reaps the greatest benefits. The retailer’s supercenter format and one-stop shopping appeal allows shoppers to consolidate shopping trips, thereby saving time and gasoline.

TNS Retail Forward ShopperScape™ research illustrates how other food, drug mass channels are faring as shoppers shift behavior:

* Convenience stores. More than a third of shoppers now buy most of their gasoline at alternative outlets, such as supermarkets, supercenters or warehouse clubs. “With gasoline prices expected to creep higher once again, shoppers will continue to pursue the best deals, including fuel discount promotions tied to shopper loyalty programs,” observes Tackett. The decline in the monthly gasoline shopper base as well as the pullback on discretionary and impulse purchases by most shoppers do not bode well for c-stores.

* Dollar stores. Despite a monthly shopper base of low-income consumers who are most susceptible to the economic downturn, dollar stores and other small-format value retailers will benefit as shoppers across income brackets turn to the channel for food and other household essentials.

* Warehouse Clubs. Although the leading club players maintained their affluent monthly shopper bases in 2008, further expected cutbacks in discretionary spending, particularly on big-ticket items, won’t help the channel going forward.

About TNS Retail Forward
TNS Retail Forward (www.retailforward.com ») is a global management consulting and market research firm specializing in retail intelligence and strategies. The company’s syndicated research and executive development program, known as the Retail Forward Intelligence System™, provides members with an authoritative perspective on the retail and consumer products industries. Shopper Update: Food Drug Mass Shopping Frequency is published in the Food Drug Mass Program of the Retail Forward Intelligence System™. To learn more about this program or report, contact Katherine Clarke at kclarke@retailforward.com ».

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