The Modern Grocery Shopper Still Loves a Local Shop
In this guest post, Emily Sak (pictured below), the head of data & insights, Shopper Media Group, says there’s lots for retailers to learn from Aussies in-store love of grocery shopping…
Though there is much market discussion about the decline of the retail category, the latest Australian Bureau of Statistics (ABS) April 2019 retail trade figures released last week tell a different story, revealing that retail spend overall rose a modest 0.2 per cent. Examining retail expenditure by category reveals, once again, that performance trends differ greatly by category.
While department store, household goods and clothing, footwear and accessories retailing have been stung by market fluctuations, food retailing has continued to outperform the overall retail category Enjoying a steady trajectory of growth over the past three years, food retailing now makes up 42 per cent of the total retail trade spend in the market.
So what is it about food retailing – specifically, supermarket retailing – that insulates it from broader changes in retail market conditions? A major factor is that e-commerce offerings have failed to disrupt the grocery market in the same manner as they have in other categories. While many put this down to the functional short-comings of online grocery shopping in Australia (the fact is, for most shoppers it is still faster and more convenient to duck down to their local grocery store than it is to shop online), this fails to account for the experiential appeal of physical grocery shopping. Many Australian shoppers enjoy the ritual of hand-picking their fresh produce, browsing the aisles for new products, and chatting with staff at their local store.
However, while Australians are still spending as much, if not more at the supermarket than ever, that doesn’t mean it’s all smooth sailing for FMCG brands. In fact, most FMCG marketers will attest that today’s market and consumer landscape is becoming more and more challenging. The value of a shoppers basket might be increasing, but what has shifted dramatically is how we shop – consumers are savvier, less brand loyal and more open to switching both products and retailers.
Findings from Evolution of the Modern Grocery Shopper 2019, a new research study commissioned by Shopper Media Group, revealed that seven in 10 of grocery buyers do not stick to a shopping list, and one in two say they don’t know what brands they’ll buy before the go to the supermarket.
These behaviours highlight the importance of prompting consumers right up until the last moments before purchase. While some argue that point-of-sale advertising would best convert these consumers, the study revealed that two in three grocery shoppers do not go down every aisle, reinforcing the value of retail digital out of home (DOOH) panels that target consumers as they enter the store.
Retail DOOH advertising has proven to be an efficient and effective tool to convert shoppers in those last 40 metres before they reach the supermarket – yet some Australian brands and retailers have been slow to respond.
While there are a lot of influential priming advertising formats within the outdoor space, retail DOOH is unique in that it is both a primer and a converter. Reaching consumers in the retail environment while in a purchasing mindset, retail DOOH gives brands the best chance of conversion from the list into the basket.
DOOH has brought the personalised nature of online shopping to bricks-and-mortar stores with its ability to target specific audiences at specific times in the retail environment. In retail DOOH, highly sophisticated technology including integrated wifi, analytics and location-based service offerings drive engagement with shoppers through personalised, location-based messaging.
Shopper Media Group has invested heavily in technology such as Shopper Ai, a new platform that collates data from multiple providers and real-time shopper analytics into one ecosystem. This provides detailed mapping of the local communities that use our network of shopping centres. We are able to ingest a brand’s data into our data ecosystem so we can identify the best audience-led solutions for their campaign. Essentially, we handpick the shopping centres that will benefit from higher weighting due to the volumes or propensity of audience using those specific centres.
The Evolution of the Modern Grocery Shopper study also reveals that, consumers are increasingly embracing the experiences their local centres provide. While convenience reigns as the number one reason shoppers choose local, the research shows that consumers are also drawn to the intangible benefits that their local centres deliver – a heightened sense of community and belonging. This is a trend that both Woolworths and Coles have recognised and are capitalising on with their small-format store strategy. It’s also seen marketers move towards a more localised approach that drives consumers to their brand within these neighbourhood centres.
In the current market landscape, retail DOOH is driving efficacy that enables more targeted, personalised messaging by brands within local communities and the centres themselves. Brands now have the opportunity to reach consumers with relevant and targeted messaging in the last 40 metres before the most important point of the marketing funnel – purchase.
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