SCHAUMBURG, Ill. -- Shopping at dollar stores is becoming an increasing part of American life, according to ACNielsen U.S., an operating unit of ACNielsen Corporation. An ACNielsen Homescan¿ consumer panel analysis found that 52% of U.S households shopped at dollar stores such as Family Dollar, Dollar General and Dollar Tree in 1999 -- up from 47% in 1998.
"Dollar stores have carved out a successful niche for themselves," according to Todd Hale, senior vice president, ACNielsen consumer analytics. "In many cases, they have been able to buy or lease low-cost stores in poorer areas. Their strategy in offering low prices, a wide selection of basic staple items and a simple pricing structure is proving effective in appealing to the lower-income populations they serve."
An analysis of the top ten product groups sold in dollar stores shows that the channel continues to take share away from other channels. Such Center Store categories as candy, detergents, laundry supplies, household cleaners, soap, paper products and snacks stand to feel an impact from this new alternative format.
"While moving from a 2.7% to 3.1% share within the detergent product group, for example, may not seem dramatic, annual detergent product group sales total nearly $8 billion," Hale said. "Capturing an additional four tenths of a percentage point of share shifts nearly $32 million to the dollar store channel. This channel is more than nibbling away at some of the other channels; it's taking a significant bite out of portions of their business."
This information comes from the ACNielsen Homescan suite of syndicated products, which includes Consumer*Facts, Channel*Facts, and Account Shopper Profiler. Homescan tracks 55,000 households in 21 local markets. Homescan households scan the UPC-coded products they purchase with a patented hand-held home scanner and then download the information via telephone to ACNielsen. Random weight (non UPC-coded) product purchases are also captured from 15,000 households in eight local markets.