Consumers Shop Less, Spend Less per Store Trip

April 1, 2010

A downward trend of US consumers shopping less hit a new low in February 2010, according to data from The Nielsen Company.

Monthly Shopping Trips Decline 4%
Monthly all-outlet shopping trips among US consumers declined 4% on a year-over-year basis in February 2010. And while per trip shopping basket rings began to pick up during and after the holidays, February 2010 remained static with a 1% increase compared to February 2009. Retailers’ focus on store brands and price cuts helped keep spending levels in check, driving more value for shoppers.

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Shopping Trends Flatline in Major Channels
A closer look at monthly shopping trips shows that trends have virtually flatlined in total and across all major retail channels. In total, consumers have fairly consistently averaged about 11.5 trips per month since February 2009, with a small peak in late 2009/early 2010 that exceeded 12 trips in January 2010, most likely due to aggressive post-holiday markdowns.

Grocery Fares Better than Other Channels
Breaking down results by major channel, grocery stores have been shopped far more often than other competitive retail channels. Consumers have consistently averaged around five grocery shopping trips per month since February 2009. The number of monthly shopping trips in the grocery channel hit a slight peak in November 2009 and has moderately declined since.

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The second-most shopped channel, supercenter, has averaged about 3.75 monthly consumer shopping trips in that same time period. Other competitive retail channels, such as dollar, drug, mass merchandise, and club, have all averaged between 1.75 and two monthly consumer shopping trips since February 2009. Monthly shopping trips for club and mass merchandise retailers appear to be on a downward trend, while other major non-grocery retail channels are flatlining.

Steps to Improve Shopping Trip Frequency and Spending
Nielsen trends show that consumers are not shopping more stores looking for deals, as consumers consistently shopped fewer retailers each period in 2009 than they did in 2008. Thus Nielsen advises retailers to follow three strategies that keep shoppers satisfied and spending while they are in the store:

1. Satisfy loyal shoppers with savings linked to shopping frequency and spending levels.
2. Entice new shoppers with promotional offers such as a free reusable shopping bag or product.
3. Offer value and low prices, but more important, stake a claim to at least one or two points of differentiation to maintain a competitive advantage.

Job Stability Leads to Spending
In a possible sign that shopping trip and spend averages may increase this year, seven in 10 Americans consider their job situation today “just as stable” or “more stable” than last year, according to the March 2010 American Express Spending & Saving Tracker. The Tracker also indicates this feeling of job stability often leads to higher spending.

Fifty-four percent of Americans consider their current job situation “just as stable” as last year. Another 16% consider it “more stable,” for a combined 70% of Americans who report having some level of job stability. In contrast, 24% consider their current job situation “less stable” than last year.

A majority of consumers who report having higher levels of job stability also report increased spending. Sixty percent of respondents reporting they have more job stability have increased their spending and investments. Popular areas for increased spending include discretionary categories such as dining out (35%) and travel (31%).

About the Data: This year-over-year data is taken from The Nielsen Company Homescan and excludes gas only or Rx trips.

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