Consumers are relying more on new media tools and less on traditional ones to make their CPG brand decisions, according to survey data from IRI. But even so, traditional marketing tools such as newspaper circulars are likely to influence far more consumers than newer technology-enabled tools such as smartphone applications, per the study, which asked consumers about a range of influences on their brand choices.
The study’s results indicate that the top decision influencer is item price, with 81% of respondents to the Q4 2013 study saying it would influence their brand decisions this year. Previous trust/usage of the brand followed, at 78% of respondents. While the influence exerted by coupons from home (57%, down from 65% in Q4 2011) and newspaper circulars (51%, down from 58%) appears to have shrunk somewhat over the past couple of years, a majority of respondents still rely on them for their brand decisions.
While more consumers are being swayed by online advertising (11%, from 9%), smartphone apps (10%, from 5%) and mobile advertising (6%, from 4%), these tools have far less reach for the time being.
The study finds considerable belt-tightening behavior among consumers heading into this year, with 9 in 10 consumers professing to be cutting back on non-essential items. When it comes to grocery shopping, some 93% will consider price more heavily than convenience when making brand selections, 91% will buy more private labels than before, and an equal 91% will try new cheaper brands to save money.
Those findings paint a picture of a more cash-strapped consumer than recent research has shown. For example, an Experian study found that shoppers – even the most deal-hungry ones – are less concerned with price than context and convenience. The IRI survey certainly seems to have caught shoppers in a more pessimistic frame of mind: IRI’s Shopper Sentiment Index, which is a measure of the economy’s impact on consumers and how they approach grocery shopping, dropped almost 7 points from 109 in Q3 to 102.2 in Q4. That includes a 10-point drop among Millennials to an index of just 90.
According to IRI, “a Shopper Sentiment Index score of more than 100 reflects consumers who are less price driven, more loyal to favorite brands and better equipped to maintain their desired lifestyle without changes.”