IRI's Times & Trends highlights new developments and critical events across all major CPG categories and key channels, providing powerful benchmarking data to help guide your strategic decisions.

This month’s Times & Trends Executive Summary highlights the impact of the U.S. recession on consumer non-food shopping patterns across retail shopping channels, drawing on a household panel of over 70,000 US households who scan all of their bar-coded purchases at home from every conceivable retail outlet where a CPG product is sold. Next month’s issue will provide an in-depth review of consumer shopper’s “wellness” spending patterns. We hope you enjoy this issue and look forward to hearing your feedback.

This free summary is also accessible via the GMA Web site  at http://www.gmabrands.com/publications/gmairi.cfm

We hope you enjoy this issue and look forward to hearing your feedback.

Shoppers Shift Non-Food Spending to Discount Channels.
The soft economy, which is driving shoppers’ search for greater value, has encouraged a significant shift of non-food CPG shopping and purchasing from mass merchandiser and food channels over to deep-discount supercenter, club and dollar store channels. These newer outlets combined accounted for 23% of shopper dollars spent on non-food CPG categories in 2002, up from 20% in the year ending April 29, 2001. Drugstores held steady. The largest channel, food stores – at 34% of total shopper spending on non-foods – was down nearly 2 points and spending at traditional mass merchandisers was off 8.5%, dropping share nearly a point.

Shopper Non-Food Spending by Channels – in Terms of % Share, Share Change and Growth in Shoppers' Spending on Non-Food CPG (YR 2002 versus YR 4.29.01*):

*Calendar 2002 spending was compared to a 52-week period between May 2000 and the end of April 2001 to avoid the extremely erratic shopping behavior connected to Y2K at the beginning of the century and the 9/11 terrorist attacks at the end of 2001.

Multi-channel shoppers are heavier non-food spenders.
One-third of shoppers’ non-food spending was in two channels and an additional third in three or more channels. Three-plus channel shoppers account for a proportionately larger share of total spending across all non-food categories. In the twenty largest non-food categories, three-plus channel buyers ranged from 12% to 34% of total category buyers, but 27% to 57% of total category spending. The most active cross-channel shoppers are comparing prices and looking for the best deals in a softer economic period.

Shoppers favor supercenters for house care, self care and pet care needs.
The bulk of non-food categories show relatively good shopping growth, spurred by increased spending at the discount channels with supercenters reaping the largest gains in share of shopper dollars. Shopper spending at supercenters for house care products increased 21.2%, for self-care products up 17.7% and for pet care products a lofty 26.9%.

House care's +4.1% growth led by tissue products.
When the price is right, house care products like facial and toilet tissue lend themselves to stocking-up. Seventy percent of spending on tissue products comes from 2-channel and 3+channel category shoppers. The two categories account for 35% of the growth in house care spending across all channels from a combination of 42 categories.

Personal hygiene's +6.7% leads self-care spending growth.
Recent dental care news/innovations and increased interest in “brighter smiles and fresher breath” have fueled shoppers' spending shifts to discount channels. Spending at club or warehouse stores growing 29.4%, at dollar stores up 26.4% and supercenters climbing 24.2%. Toothpaste, toothbrushes and other dental accessories – including the new teeth whiteners and new oral care strips – accounted for 55% of all incremental shopper spending in the personal hygiene consumption arena. 

Pet care shoppers devoted to multi-channel shopping to find best price.
Because of higher unit prices, shoppers of diapers, cigarettes and pet foods are dedicated to finding the best deals. Three or more channel shoppers for dog or cat food dominate spending, accounting for over half of all dollars spent on the two categories. Pet care shoppers shifted 2.7 share points of their total spending over to supercenters, growing to a 15% share of shopper dollars.

Given consumers' multi-channel shopping tendency, it is easy to understand the shopper shift or migration to the newer discount formats.
Because of the economic crunch, there’s heightened interest in savings. The discount store format is more and more available. And even with time constraints, shoppers are persistent to find the best deals. With non-foods – you see a better price, you grab it.