Inside This Issue - News
Still in budget mode
July 23rd, 2012
JACKSONVILLE, Fla. – The sluggish economy has consumers continuing to hunt for discounts regardless of their incomes, according to Acosta Sales & Marketing’s latest “The Why? Behind The Buy” biannual report.
Shoppers with annual incomes of less than $45,000 and those with incomes over $100,000 are making purchasing decisions based on similar factors, including price, the spring 2012 report found.
More than half (55%) of consumers bought more items on sale than last year, it notes, and almost three-quarters (71%) plan their shopping trips before heading out to the store.
Nearly nine in 10 shoppers (88%) have taken advantage of buy one, get one free offers, and half cut coupons.
"Today’s purchasing and marketing trends are reflective of a continued challenging economic climate," said Acosta president and chief executive Robert Hill. "Shoppers are still budget conscious, leading marketers to use discounts to spark demand."
The report, compiled by AMG Strategic Advisors, Acosta’s growth strategy consulting unit, found that the average monthly grocery budget has increased 11% to $309, reflecting higher unit prices. As a result, shoppers are spending three times more on groceries than on eating out.
Shoppers are creatures of habit, with 84% buying what they have bought before. Only three out of 10 say they will continue to purchase stores brands when their budgets increase.
Today’s consumer is a multichannel shopper, moving across trade classes to find the best deals and products.
The influence of digital marketing continues to grow as shoppers strive to increase productivity, with 36% logging online and 20% visiting brand and retailer websites to find coupons and deals.
"With shoppers in ‘maintenance mode’ and CPG suppliers and retailers faced with rising commodity costs and narrower margins, demand creation is the challenge," the report concludes.
It advises companies to think “high/low” by exploring opportunities to create premium and extreme value products to address the growing divide between income groups.
Companies should also understand which trade classes produce results when and why, and develop customized marketing strategies accordingly.
They should get creative with promotions — seeking ways to provide more flexible and customizable offerings for shoppers. Collaborations with strategic brand partners to create co-branded shopper marketing promotions are encouraged.
And such traditional marketing programs as store circulars, shelf tags and point-of-sale displays should be infused with digital marketing elements.