Times & Trends

CHANNEL MIGRATION: THE BLURRING
OF SHOPPER LOYALTY
EXECUTIVE OVERVIEW

IRI's Times & Trends highlights new developments and critical events across all major CPG categories and channels, providing powerful benchmarking data to help guide your strategic decisions. This issue of Times & Trends provides insights into recession-driven changes in consumer shopping patterns across departments, categories and consumer segments, and serves as a foundation for competitive and distribution strategy development as well as a baseline for ongoing tracking efforts. A free summary is also accessible via the GMA website at www.gmaonline.org.

INTRODUCTION

U.S. consumers have been battling adverse economic conditions for well over 18 months now. The country has faced sky-rocketing gas prices, high levels of unemployment, unprecedented increases in CPG prices and an array of other financial stressors.

To cope, consumers have been forced to make significant changes to everyday behaviors. No doubt, today’s consumers are more self-reliant and more in-tune with how and where money is spent.

In last year’s Channel Migration issue of Times & Trends we highlighted sizable share gains by supercenters across departments and income segments resulting from consumer efforts to stretch their CPG dollars. Supercenters continue to play a major role in providing consumers with affordable CPG solutions.

Over the past year, however, competing retail channels have turned up the heat.

The end result is a more complex battleground. Retailers are embracing specialized and targeted marketing and merchandising strategies in an effort to win shoppers.

This report provides insights into recession-driven changes in consumer shopping patterns across departments, categories and consumer segments, and serves as a foundation for competitive and distribution strategy development as well as a baseline for ongoing tracking efforts.

KEY FINDINGS

»As the recession drags on, consumer shopping habits continue to evolve; shopping across multiple channels has become a hallmark of consumers seeking the best value for everyday CPG needs.

To maintain more consistent CPG budgets, consumers are moving to more frequent shopping excursions with more consistent basket rings; however, a majority of purchase decisions are made before entering the store.

Supercenters are winning share of spending across CPG departments and key demographic segments, albeit at a slower pace versus last year; however, other channels have turned up the heat and are once again making in-roads across select categories, departments and demographic segments.

»Dollar Share Point Change by Department 2009 vs. 2008
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The grocery channel continues to struggle across fresh/perishable, frozen and center store, including high-demand meal ingredient and meal component categories.

Health & beauty and household care categories are increasingly at the center of channel share battles; grocery, supercenter and drug channels are each displaying strength across key health & beauty categories, while household care channel shifts vary by category.