Australia: Specialty stores have the edge on supermarkets

Rising patronage of specialty and traditional fresh food outlets (green grocers, fish markets, butchers and bakeries) is threatening to eat away at supermarkets’ ‘share of stomach’ as consumers increasingly shop around in search of the freshest food offer, a report released today by The Nielsen Company reveals.

By combining data from its retail measurement service, Homescan consumer panel and Winning Brands Store Equity Model, the 2006 Nielsen ShopperTrends Report provides unique insight into the current Australian grocery retailing environment and shopper behaviour.

According to the report, supermarkets remain the dominant retail trade channel driven by frequent consumer patronage (98 percent of survey respondents claimed to have visited a supermarket in the past seven days).

However, the supermarket channel could face some competitive pressure as the popularity of fresh food outlets rises.

When respondents were asked what type of specialty food store they had visited in the past seven days, 34 percent said they had visited a fish shop and/or butcher (up 5 percentage points from 2005), half (50 percent) had visited a fruit and vegetable store (up 7 percentage points from 2005), and half had visited a bakery (also up 7 percentage points from 2005).

The vast majority of consumers said that they most frequently visited a supermarket when it came to purchasing categories such as ice cream (76 percent), biscuits (90 percent), shampoo (76 percent), laundry detergent (86 percent), snacks (80 percent), confectionery (77 percent) and cooking oil (93 percent).

However, when it came to purchasing fresh produce, supermarket loyalty was lower with around three in five consumers claiming to most frequently purchase their fresh fruit and vegetables (60 percent) and fresh meat, chicken, fish or seafood (63 percent) from a supermarket.

While around a third of respondents said that they most frequently purchased their fruit and vegetables in a traditional green grocer (35 percent) and their fresh meat, chicken and seafood in a butcher or fish shop (32 percent).

In a separate study conducted on Nielsen’s Online Omnibus, consumers were asked why they chose to most frequently purchase their fresh produce outside of a supermarket, and overwhelmingly it was the perception of quality that was the driving factor — with 80 percent of these respondents citing quality as one of the reasons, followed by price (39 percent), location (39 percent), range/choice (35 percent) and service (12 percent).

"The modern Australian consumer wants a convenient and easy shopping experience, and is willing to shop around for high quality, fresh produce," says Darin Williams, director of Retailer Services.

"Our research shows that irrespective of their absolute dollar spend, consumers are claiming to spend on average around 30 percent of their total monthly grocery bill on fresh produce.

"This clearly underlines to retailers the importance of ensuring that customers are provided with access to a good selection of high quality fresh food in store — regardless of whether it is in a large supermarket chain or a traditional specialty food outlet."

Source: qbr.com.au