CONSUMER SURVEY: LOYALTY IS FLEETING

More than three out of four grocery shoppers would desert their current favorite supermarket for another one offering good selection and competitive prices, according to a national survey commissioned by Supermarket News.

n to conventional operators in the battle for customers.

The study polled more than 1,000 grocery shoppers across the United States by telephone.

The absence of consumer allegiance to supermarkets was a prime finding of the report. A total of 77.8% of respondents said that if a new store opened in their area offering good selection and competitive prices, they would pick the new supermarket over their existing store.

"This finding represents an amazing lack of loyalty to supermarkets," said Britt Beemer, chairman of America's Research Group, a survey research firm covering the U.S. retail, manufacturing and service industries.

"It clearly shows that customers are susceptible to being lured away, and a new store with an aggressive predatory marketing strategy could steal three out of four customers away from current stores in the market."

The lack of shopper devotion to a single store is also reflected in the fact that one in three primary grocery buyers shop at two different supermarkets during a normal week, and 15% of shoppers visit three or more stores in a typical week. The average number of different supermarkets consumers shop weekly is 1.7.

When quizzed about why they varied their shopping patterns, 47.1% cited sales on certain items, while one in four said they "liked certain stores for particular items." Thirteen percent responded that their favorite store didn't carry everything they wanted.

This national survey of supermarket consumers was conducted during the week of March 7, 1994.

The study also found that nearly half of all American consumers do at least a portion of their grocery shopping at discount stores.

When asked if they had purchased any food or grocery items at discount stores in the past year, 49.4% of those surveyed reported that they had. "Clearly Americans see discount stores as significant alternatives to supermarkets for their food and grocery needs," Beemer said.

In addition to showing that discount stores attract a big share of grocery dollars, the study found that phenomenon is occurring at a faster rate. Asked if they were buying more or fewer food and grocery items at discount stores than a year ago, 46.5% of shoppers reported they were buying more.

Convenience stores scored second highest as supermarket alternatives, according to the report.

Nearly four in 10 shoppers answered that they had purchased food or grocery items at convenience stores over the past year. But 42.8% said they were shopping less often at convenience stores than a year ago.

Following convenience stores in popularity were membership warehouse clubs, fresh meat markets, fruit and vegetable stores and drug stores. Slightly more than one in three shoppers said they had bought from membership warehouse clubs, and 51.1% said they were shopping at those stores more than a year ago.

The statistics for fresh meat markets and fruit and vegetable stores were almost identical, with 34% reporting that they shopped each kind of store, and just over one in two saying they were shopping those types of stores more than before.

Drug stores were viewed as the least popular alternative for food and grocery items. Only 29.1% said they had bought food at drug stores, and close to half said they spent less on food and groceries in those stores than the year before.

When consumers were asked what they shop for most at supermarkets, they ranked the following as their five most popular purchases, in order of importance:

1. Fresh meats.

2. Milk.

3. Bread.

4. Fresh vegetables.

5. Canned goods.

Shoppers were also asked about the most important services or amenities a supermarket can offer. Here are their responses, in order of priority:

1. Overall cleanliness.

2. Fast checkout lanes.

3. Wide aisles.

4. Having a meat cutter in the fresh beef/pork area to answer questions.

5. (tie) Offering special deals through aisle displays.

5. (tie) Having a produce person in the fresh fruit and vegetables area to answer questions.

Other services, like home delivery, taking credit cards, having automated teller machines on site and operating in-store restaurants were not perceived as of major importance.

The study also pointed to consumer food safety concerns. When it comes to the issues of quality and safety, consumers feel most comfortable about the canned goods they buy: 64.8% of consumers said they felt confident about these items and 30% felt very confident.

Following canned goods were categories including frozen foods, dairy products, deli meats and fresh fruits and vegetables.

The level of confidence in the safety and quality of fresh fish or seafood was ranked lowest. Only 18.7% said they were very confident, and 55.8% expressed confidence.

America's Research Group's clients operate in 46 states and throughout Canada, and include discount and grocery operators. Retail clients generate $60 billion in annual sales.

Here are other factors impacting shoppers' habits, according to the survey:

BRAND NAMES won a vote of confidence. Despite the increase in generic and private-label products, most consumers still prefer to shop brand names. Five in nine say they normally purchase name-brand products when they shop. Nearly 40% report they do shop for private-label brands, and 5% purchase both.

COUPONS play a major role in driving store traffic. Three out of four shoppers claim they or someone in their immediate family use discount coupons, and more than half of those who use them shop stores offering double discounts.

CONVENIENCE is another big factor in supermarket selection. Nearly 77% of shoppers drive 10 minutes or less to reach their favorite store, with 8.6 minutes being the average time spent traveling from home to supermarket.

EVERYDAY LOW PRICE is listed as a primary driving force for consumers to shop supermarkets. Large selection, fast checkout, convenient location and weekly specials are four other critical secondary forces bringing consumers into stores.

CUSTOMER SERVICE levels win praise from shoppers. Slightly more that 94% rank their favorite store's customer service as good or very good. Fewer than 6% of respondents offered a fair or poor ranking. And more than half feel that the customer service they receive is better than a decade ago, while one in five feel customer service has declined in the last 10 years.

PRICE COMPETITIVENESS by supermarkets scores well. The majority of shoppers feel the prices they pay at the stores they shop most often are just as low as other stores. Slightly more than one in five feel they pay the lowest prices available in their area.

PREPARED FOODS like cooked or barbecued chicken and potato salad have a substantial following. Nearly 60% report that they have bought those items in the past year, and more than 43% say they are buying more prepared food than they were a year ago.

If a new supermarket offering a good selection and competitive prices opened in your area, would you shop at this new supermarket or at an existing supermarket?

NEW 77.8% EXISTING 21.5%

In the last year, have you purchased any food or grocery items from a discount store?

YES 49.4% NO 50.6%

If yes, are you buying more or less than a year ago?

MORE 46.5% LESS 20.4% SAME 33.1%

How would you rate the prices at the supermarket you shop most often?

The lowest 22.4%

Just as low as the others 62.4%

Slightly higher 11.5%

Higher prices than most 3.1%

Don't know 0.7%

How would you describe the overall customer service level you receive at the supermarket you shop most often?

Excellent 15.4%

Very good 44.3%

Good 34.4%

Fair 5.7%

Poor 0.2%

Do you feel the service today is better or worse than 10 years ago?

Better 57.4%

Same 23.1%

Worse 19.3%

When you shop at a supermarket for groceries, do you normally purchase national brand products or do you purchase the store's private label brand?

National brand 56.1%

Store brand 38.6%

Both 4.9%

How many different supermarkets do you shop during a normal week?

One 49.6%

Two 34.3%

Three 13.1%

Four or more 3.0%

When thinking about an ideal supermarket, what do you feel is most important to you as a customer?

PERCENTAGE OF RESPONDENTS

Everyday low prices 24.2%

Convenient location 21.2%

Service 15.5%

Fast checkout 14.3%

Large selection 11.6%

Weekly specials 8.4%

Store reputation 4.0%