Table of Contents
Executive Summary
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- Top takeaways
- Market overview
- Mass merchandisers’ sales will benefit from value-focused shoppers
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- Figure 1: Total US revenues and forecast of mass merchandisers, at current prices, 2015-25
- Impact of COVID-19 on mass merchandisers
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- Figure 2: Short-, medium- and long-term impact of COVID-19 on mass merchandisers, December 2020
- Opportunities and challenges
- Use partnerships to become a destination beyond the essentials
- Improve online convenience through social commerce and personal services
- Use technology to provide a clean shopping experience
The Market – Key Takeaways
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- High unemployment and low confidence will keep value-conscious consumers shopping at mass retailers
- Partnerships, sustainability and technology will fuel mass retailers’ sales growth
Market Size and Forecast
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- Value-focused shopping will accelerate growth at mass merchandisers
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- Figure 3: Total US revenues and forecast of mass merchandisers, at current prices, 2015-25
- Figure 4: Total US revenues and forecast of mass merchandisers, by segment, at current prices, 2015-25
- Macroeconomic data
- High unemployment and low confidence will push more consumers to mass retailers
- A focus on essentials will continue to drive traffic at mass retailers
- Impact of COVID-19 on mass merchandisers
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- Figure 5: Short-, medium- and long-term impact of COVID-19 on mass merchandisers, December 2020
- Lockdown
- Re-emergence
- Recovery
- COVID-19: US context
- Learnings from the last recession
Market Factors
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- Recession will elicit more value-seeking behavior
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- Figure 6: Consumer confidence and unemployment, 2000-October 2020
- Lifestyle and ethnicity influences where consumers shop
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- Figure 7: Number of households, by race and Hispanic origin of householder, 2013-23
- Figure 8: Living arrangements of adults aged 18 or older, 2008 and 2018
- Tech-driven consumers seek a seamless shopping experience
Market Opportunities
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- Embrace secondhand and sustainable shopping
- Explore external partnerships that combine consumers’ interests
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- Figure 9: Ulta and Target partnership announcement, November 2020
- Evolve online offerings to improve the online experience
- Use technology to provide safer, cleaner shopping
Competitive Strategies
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- Target and Ulta team up to tackle the beauty market
- Walmart’s new loyalty program goes toe-to-toe with Prime
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- Figure 10: Walmart + commercial, September 2020
- Store brands get a facelift
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- Figure 11: Target good & gather groceries, September 2020
- Figure 12: Walmart free assembly apparel, December 2020
- Mass retailers meet holiday shoppers where they are
- Walmart delivers Christmas to shoppers, including trees
- Meijer rewards those who use curbside pickup
- Retailers get social with shoppers
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- Figure 13: Target shopping guide: gifts for the fam, December 2020
- Figure 14: Walmart and Tastemade “struggle meals” holiday video, November 2020
The Consumer – Key Takeaways
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- Majority of consumers are shopping Target and Walmart
- Shoppers come for the prices, stay for the convenience and variety
- The pandemic has shifted shopping habits and preferences
Consumer Trends Drivers and Mass Merchandisers
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- Value
- Technology
- Wellbeing
- Surroundings
Retailers Shopped and Shopping Method
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- Walmart and Target have widespread consumer appeal
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- Figure 15: Retailers shopped, October 2020
- Target is the mass merchant of choice for value-seeking higher-income shoppers
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- Figure 16: Retailers shopped – By HHI, October 2020
- Majority of parents are shopping multiple mass merchandisers
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- Figure 17: Retailers shopped – By parental status, October 2020
- Gen Z still likes to shop in stores
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- Figure 18: Retailers shopped and shopping method – By generation, October 2020
Items Purchased
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- Essentials and beauty are top purchases, regardless of brand
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- Figure 19: Items purchased – Store brands versus name brands, October 2020
- Mass merchandisers are a beauty destination for most women
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- Figure 20: Items purchased – Store brand versus name brand (BPC) – By gender, October 2020
- Parents are shifting grocery purchases to mass retailers
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- Figure 21: Target recipe for parents and kids, October 2020
- Figure 22: Items purchased – Store brand versus name brand (groceries) – By parental status, October 2020
Reasons for Shopping Mass Merchandisers
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- Value is a primary reason for shopping mass
- What’s happening
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- Figure 23: Reasons for shopping mass merchandisers, October 2020
- What it means
- What to do
- Men’s trust motivates them to shop
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- Figure 24: Target Style: how to play dress up, November 2020
- Black consumers shop for the whole family
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- Figure 25: Reasons for shopping mass merchandisers – By gender and ethnicity, October 2020
Perceptions of Mass Merchandisers
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- Target vs Walmart
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- Figure 26: Perceptions of mass merchandisers – Target versus Walmart, October 2020
- Kmart and Walmart need reliability
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- Figure 27: Correspondence analysis – Symmetrical map – Perceptions of mass merchandise, October 2020
- Social consciousness needs improvements
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- Figure 28: Target Black-owned businesses post, September 2020
- Figure 29: Walmart taking action against racism, June 2020
- Majority don’t think it’s easy to shop online at mass merchandisers
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- Figure 30: Select perceptions of mass merchandisers, October 2020
- Young women love Target’s affordable trends
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- Figure 31: Target designer dress collection, June 2020
- Black consumers appreciate Walmart, while Hispanic consumers appreciate Target
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- Figure 32: Perceptions of Walmart – By race, October 2020
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- Figure 33: Perceptions of Target – By Hispanic origin, October 2020
Changes because of COVID-19
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- One third of shoppers are primarily shopping at mass retailers
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- Figure 34: Changes because of COVID-19, October 2020
- Mass merchandisers have gained more male shoppers
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- Figure 35: Changes because of COVID-19 – By gender, October 2020
Desired Improvements
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- Free delivery will have the most impact on shopping
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- Figure 36: Desired improvements, October 2020
- Cleanliness is currency for many shoppers
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- Figure 37: Desired improvements – Clean-shopping – Select demographics, October 2020
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- Figure 38: Walmart touch-free checkout video, April 2020
- Social commerce appeals to tech-driven and convenience-driven shoppers
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- Figure 39: Desired improvements – Shopping through social media – Select demographics, October 2020
- Hispanic shoppers want both clean and alternative shopping options
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- Figure 40: Desired improvements – By Hispanic origin, October 2020
Appendix – Data Sources and Abbreviations
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- Data sources
- Sales data
- Forecast
- Consumer survey data
- Abbreviations and terms
- Abbreviations
Appendix – The Consumer
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- Figure 41: Shopping method – in-store versus online, October 2020
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- Figure 42: Correspondence analysis – Symmetrical map – Perceptions of mass merchandise, October 2020
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