SymphonyIRI: Shoppers Remain Frugal With Prolonged Downturn

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November 29, 2011

The ongoing economic downturn has spawned a new breed of consumer, dubbed “downturn shoppers” by SymphonyIRI, whose frugal practices continue to effect how and what they buy.

A new SymphonyIRI Times & Trends Special Report, “The Downturn Shopper: Buckled in for a Wild and Crazy Ride,” highlights these behaviors and reveals the impact the economy is having on personal finance, lifestyle and shopping behaviors and saving strategies. The message for the private label industry is that it’s not enough to have low-cost value options.

While a good deal of research goes into the development of store brands and the good-better-best tiered approach to providing consumers with choices spanning a quality range, economic concerns are changing the decision making process before shoppers get to the store.

Online research, deal seeking and coupon clipping are all on the rise, something retailers need to keep in mind when developing promotional materials for store brands.

“Many of the rituals consumers are embracing as they seek to manage their budgets involve packaged goods solutions,” said Susan Viamari, editor of Times & Trends. “But shoppers are selecting and using these solutions in a very cost-conscious manner. Marketers must understand and deliver against the conservative mindset behind this approach to daily living in order to fully capitalize on opportunities spawned from consumers’ ongoing budgetary concerns.”

The Times & Trends Special Report is based on results from SymphonyIRI’s third quarter MarketPuls survey which revealed that a majority of shoppers remain pessimistic about their personal finances and that, as this pessimism continues, they are increasingly expanding money-saving practices such as eating at home, extending the life of personal care products, utilizing a cleaning product for multiple tasks, clipping and downloading coupons, and using the Internet to find the best deals.

Shoppers are also approaching grocery shopping in a very measured manner, as they feel the need to budget and spend prudently. To that end, many shoppers are making purchase decisions at home, before they head into stores:

• More than two-thirds of shoppers enter the stores with ready-made lists;
• A substantial and growing number of shoppers are combing circulars and coupons to find the best deals;
• When in store, two-thirds have cut back on “non-essential” grocery purchases; 
• 26 percent of consumers research products on websites, an increase of two points from the previous quarter;
• 39 percent of shoppers download recipes off websites and other online sources, versus 36 percent in the second quarter;
• 37 percent of consumers download coupons from manufacturer websites, compared to 35 percent in the previous quarter

“Retailers and manufacturers seeking to succeed and remain profitable in today’s challenging retail environment must consider implementing aggressive product and shopper marketing initiatives,” said John McIndoe, senior vice president of marketing for SymphonyIRI. “Most importantly, these initiatives must demonstrate value, not necessarily just based on price and convenience, but also on delivering relevance. To do so, CPG marketers must begin with a holistic shopper analysis, founded on an integrated analysis of frequent purchase data plus demographics, life stages, needs, usage and more.”

Read These Related Articles:

• NPD: Consumers Clutch Thrift When Planning Meals
• Nielsen: Secret to Successful New Product Innovation is to Keep the Boss Out
• Retailers: Focus on Packaging and In-Store Marketing to Drive Shopper Growth
• Store Brands Buying Decisions Made at the Shelf, Not in the Home
• Loyalty to Nationally Advertised Brands Declines

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