Rising prices ‘greatest factor in grocery purchase decisions’

30/08/2012

Rising food prices are having the greatest impact on global consumer’s choice of grocery purchases, with more than half (52%) stating higher prices are a major influence, according to new research. The Nielsen global online survey found that 85% of respondents attributed rising food prices as the main factor influencing their buying behaviour.

But price is not the only consideration that weighs heavily on the minds of consumers when shopping for groceries. Health factors, product availability and in-store services are also important considerations.

New findings from a Nielsen online survey of respondents from 56 countries around the world provide insights into how 16 various factors have impacted grocery purchases in the last year.

Manufacturers and retailers armed with this knowledge can fine-tune strategies to better align with what matters most to consumers—and what does not.

The rising price of food is the number one consideration among 16 factors measured by Nielsen that influence consumer’s choice of grocery purchases.

The consistency of findings across the regions underscores the ongoing struggle consumers worldwide are grappling with in this volatile economic environment.

The increasing cost of food is affecting 88 percent of respondents in Asia-Pacific, 86 percent in Latin America, 83 percent in North America, 82 percent in the Middle East/Africa region and 81 percent in Europe, with more than half of respondents in these regions indicating that rising food prices is having a major impact on choice of grocery purchases.

Soaring fuel prices, which lead to increased transportation costs, are also affecting consumer choice.

More than one-third (35%) of global respondents consider the cost of traveling to buy groceries a major obstacle, ranking it among the top four key implications that affect grocery shopping choice across all regions.

Forty-two percent regard transportation costs as a minor issue.

While many transportation-based factors, such as store proximity, cost of fuel and economic conditions can affect grocery shopping habits, retailers can alleviate some of the burden by integrating fuel benefits into their own loyalty scheme.

Fuel points programs on-site or in close proximity to stores are proving to be a winning competitive strategy. Providing meal deals and recipe ideas for more at-home eating options and promoting convenient store locations are other ideas being explored.

Retailers would also be wise to build in contingency plans that account for swings in gas prices during peak months when prices typically rise.

Other notable findings include:

• The influence of health factors on shopping choice is most significant in Asia-Pacific

• De-listing a favorite product is a major concern for 3-in-10 global respondents

• Retailer loyalty programs significantly impact shopping choice for 1-in-4 consumers worldwide

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Download the full report here (registration required)

Source: www.nielsen.com

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