Table of Contents
Scope and Themes
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- What you need to know
- Definition
- Data sources
- Sales data
- Consumer survey data
- Advertising creative
- Abbreviations and terms
- Abbreviations
- Terms
Executive Summary
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- The market
- Weathering the economic uncertainty with positive outlook
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- Figure 1: Fan chart forecast of MULO sales of groceries, at current prices, 2009-17
- Supermarkets capture the lion’s share of the grocery retail sales
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- Figure 2: MULO sales, by retail channel, at current prices, 2012
- Market factors
- The impact of aging Boomers and engaged Millennials
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- Figure 3: U.S. population, by generation, 2012
- Role of grocery retailers in health and wellness
- Coupons move into a new era
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- Figure 4: Use of cents-off coupons, by type of retailer, selected years 2006-12
- Supermarkets sustain competitive advantage in the crowded grocery retailing market
- The consumer
- Six in 10 shoppers claim take sole responsibility for household grocery shopping
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- Figure 5: Grocery shopping responsibility, November 2012
- Supermarkets achieve “most often” patronage for food and drink
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- Figure 6: Retailers and channels shopped for food/drink, November 2012
- Mass merchandisers and club stores most-often channel to shop for nonfood items
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- Figure 7: Retailers and channels shopped for nonfood/drink groceries, November 2012
- Increased spending at big-box/club stores and supermarkets
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- Figure 8: Spending more than last year on groceries at selected channels, November 2012
- Coupons are popular tool to save grocery expenditures
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- Figure 9: Saving strategies when grocery shopping, November 2012
- Lower prices remain king in grocery shopping, but not alone
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- Figure 10: Attitudes and behaviors toward grocery shopping, November 2012
- Grocery shoppers would welcome coupon and promotion customizations
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- Figure 11: Innovations and improvements sought in the grocery shopping experience, November 2012
- What we think
Issues in the Market
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- What are the potential implications of divergent generational shopping behaviors on grocery retailing?
- How can grocery retailers close the generational gap?
- How can supermarkets stay competitive against deep-discounted channels?
- In what innovative ways can grocery channels improve their relevance to shoppers?
Insights and Opportunities
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- Demographic shift translates into different ways to succeed
- Primary grocery shoppers demand more local food
- Capital investment focused on technology could leverage brand loyalty
- Obesity prevalence presents abundant market opportunities
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- Figure 12: Adult and childhood obesity rates, 2011
- Attention to a healthy lifestyle can encourage grocery shopping
Trend Applications
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- Trend: The Nouveau Poor
- Trend: Without a Care
- Inspire 2015 trends
- Access Anything Anywhere
Market Size and Forecast
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- Key points
- Stronger outlook for groceries
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- Figure 13: MULO sales and forecast of groceries, at current prices, 2009-17
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- Figure 14: MULO sales and forecast of groceries, at inflation-adjusted prices, 2009-17
- Fan chart forecast
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- Figure 15: Fan chart forecast of MULO sales of groceries, at current prices, 2009-17
Market Drivers
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- Key points
- Creating oases in food deserts has the potential to spur growth
- Coupons more accessible and usable via better targeting and mobile apps
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- Figure 16: Use of cents-off coupons, by retailer type, selected years 2006-12
- Leveraging private labels/store brands to boost sales and brand loyalty
- Increasing consumer confidence influences more spending on groceries
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- Figure 17: University of Michigan’s index of consumer sentiment, November 1978-2012
- The direction of grocery retailing influenced by shifting generational demographics
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- Figure 18: U.S. population, by generation, 2012
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- Figure 19: U.S. population, by age, 2008-18
- Figure 20: Share of population by generation, by race/Hispanic origin, 2012
Segment Performance
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- Overview
- Key points
- Supermarkets dominate sales, but show weakest growth
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- Figure 21: MULO sales and forecast of groceries, by retail channel, at current prices, 2009-17
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- Figure 22: MULO sales and forecast of groceries, by retail channel, at current prices, 2009-17
- Food and drink dominate retail grocery sales
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- Figure 23: MULO sales of groceries, by product segment, at current prices, 2009-12
- Supermarkets
- Key points
- Supermarkets’ retail sales receipt will post a moderate growth
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- Figure 24: MULO sales and forecast of groceries sold at supermarkets, at current prices, 2009-17
- Product segmentation at supermarkets
- Supermarkets’ competitive advantage lies in food and drink
- Household supplies and general merchandise the weakest sales generation
- HBC small representation posted the highest growth
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- Figure 25: MULO sales of groceries sold at supermarkets, by product segment, at current prices, 2009-12
- Drug stores
- Key points
- Drug stores show the highest outlook for growth through 2017
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- Figure 26: MULO sales and forecast of groceries sold at drugstores, at current prices, 2009-17
- Product segmentation at drug stores
- Food and drink showed strong sales growth
- Household supplies/general merchandise
- Naturally, HBC dominates
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- Figure 27: MULO sales of groceries sold at drugstores, by product segment, at current prices, 2009-12
- Other MULO channels
- Key points
- Other MULO prospered during the post-recession era
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- Figure 28: MULO sales and forecast of groceries sold at other MULO, at current prices, 2009-17
- Product segmentation through other MULO channels
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- Figure 29: MULO sales of groceries sold at other MULO, by product segment, at current prices, 2009-12
Retailer Profiles
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- Traditional supermarkets
- Ahold USA
- Delhaize America
- Giant Eagle
- Kroger
- Publix Super Markets
- Safeway
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- Figure 30: Safeway’s private label brands and positioning, January 2013
- Supervalu
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- Figure 31: Supervalu’s store banners, number of stores, and key markets, January 2013
- Wegmans
- Whole Foods Market
- Trader Joe’s
- Market threats and opportunities for traditional supermarkets
- Mass merchandisers and supercenters
- Target
- Walmart
- Meijer
- Market threats and opportunities for mass merchandisers
- Warehouse clubs
- Costco
- Sam’s Club
- BJ’s Wholesale Club
- Market threats and opportunities for warehouse clubs
- Drug stores
- Walgreens
- Duane Reade
- CVS
- Rite Aid
- Market threats and opportunities for drug stores
- Dollar stores and discount food stores
- ALDI
- Bottom Dollar
- Food 4 Less
- Save-A-Lot
- Dollar General
- Dollar Tree
- Family Dollar
- Market threats and opportunities for dollar stores and discount food stores
- Online retailers
- Amazon.com
- Peapod.com
- FreshDirect.com
- Market threats and opportunities for online retailers
- Other notable grocery retailers
- Farmers markets
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- Figure 32: Number of operating farmers markets in the U.S., 2002-12
Innovations and Innovators
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- Shopmuting I: Peapod’s virtual store
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- Figure 33: Peapod’s virtual stores, October 2012
- Shopmuting II: Walmart’s ‘Food Truck’
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- Figure 34: Walmart’s “food truck” in New York City, June 2012
- Direct order: ‘farm to table’
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- Figure 35: Relay Foods’ shopping and ordering, 2013
- Digital coupons management: Passbook
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- Figure 36: Passbook App: Walgreens’ Balance Reward and Target Mobile Coupons, September 2012
- Gourmet food-sample subscription service: Walmart’s Goodies
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- Figure 37: Walmart—Goodies Co., November 2012
- Robotic kiosks 24/7 access
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- Figure 38: Kroger’s Shop 24 Robotic Store, February 2012
- Revamping search engine: Polaris by Walmart
Social Media—Grocery Retailing
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- Key points
- Social media metrics
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- Figure 39: Key performance indicators, January 2013
- Market overview
- Brand usage and awareness
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- Figure 40: Brand usage and awareness of grocery retailing brands, November 2012
- Interaction with grocery retailing brands
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- Figure 41: Interaction with grocery retailing brands, November 2012
- Online conversations
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- Figure 42: Select grocery retailing brands’ share of conversations, Dec. 28, 2012-Jan. 27, 2013
- Figure 43: Conversations by brand by day, Dec. 28, 2012-Jan. 27, 2013
- Where are people talking about grocery retailing brands?
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- Figure 44: Selected grocery retailing brands’ share of brand conversations, by page type, Dec. 28, 2012-Jan. 27, 2013
- What are people talking about?
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- Figure 45: Types of conversations concerning selected grocery retailing brands, Dec. 28, 2012-Jan. 27, 2013
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- Figure 46: Types of conversation regarding selected grocery retailing brands, by day, Dec. 28, 2012-Jan. 27, 2013
- Figure 47: Types of conversation regarding selected grocery retailing brands, by type of website, Dec. 28, 2012-Jan. 27, 2013
- Analysis by brand
- Whole Foods Market
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- Figure 48: Whole Foods—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
- Kroger
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- Figure 49: Kroger—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
- Safeway
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- Figure 50: Safeway—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
- Walmart
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- Figure 51: Walmart—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
- Target
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- Figure 52: Target—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
- Costco
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- Figure 53: Costco—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
- Albertsons Market
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- Figure 54: Albertsons market—key social media indicators, Jan. 28, 2013
- Key online campaigns
- What we think
Marketing Strategies
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- Innovative ways to improve the shopping experience
- Strategy: Stimulating grocery shopping with fuel loyalty programs
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- Figure 55: VG’s Grocery, “Savings Report,” July 2012
- Strategy: Promoting online delivery ‘sampling’
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- Figure 56: Peapod, “$20 Off Your First Delivery Order,” January 2013
- Strategy: Offering ways to eat healthier food choices and recipe ideas
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- Figure 57: Whole Foods, “sales flyer: the whole deal,” January 2013
- Promoting grocery shopping saving strategies
- Strategy: Buying fresh, wholesome produce without hurting the budget
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- Figure 58: Aldi, “Don't Pay More,” October 2012
- Strategy: Comparing price with the competition to stimulate sales
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- Figure 59: Walmart, “Heavy Savings,” August 2012
- Strategy: Encouraging saving behaviors with sales flyers
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- Figure 60: Dollar General Market, “Dollar General’s Sales Flyer,” January 2013
- Strategy: Appealing to the budget-conscious grocery shoppers
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- Figure 61: Save-A-Lot, “Importance of Dollar,” July 2012
- Strategy: Increasing foot traffic for grand opening through mail coupons
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- Figure 62: Aldi, “Aldi truth #12: we don’t match other stores’ prices because that would mean raising ours,” January 2013
- Positioning brands by aligning with consumers’ attitudes/behaviors toward grocery shopping
- Strategy: Supporting local organizations—show shoppers that you care
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- Figure 63: Whole Foods, “Whole Foods Market Chicago: bright pink,” January 2013
- Strategy: Exuding style in grocery shopping
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- Figure 11: Target, “The Everyday Collection. By Target: Dominate that PTA Bake Sale,” January 2013
- Strategy: Giving shoppers the convenience of ‘one-stop’ shopping
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- Figure 64: Fred Meyer, “Thanksgiving,” November 2012
Grocery Shopping Decision Makers
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- Key points
- Baby Boomers and Gen Xers most likely be the sole grocery shoppers
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- Figure 65: Grocery shopping responsibility, by generation, November 2012
- Don’t forget the men—half share responsibility for grocery shopping
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- Figure 66: Grocery shopping responsibility, by gender, November 2012
- Figure 67: Grocery shopping responsibility, by gender and age, November 2012
- Sharing shopping responsibilities increases with income
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- Figure 68: Grocery shopping responsibility, by household income, November 2012
Retailers and Channels Shopped for Food/Drink
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- Key points
- Primary shoppers most often shop at supermarkets for food/drink
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- Figure 69: Retailers and channels shopped for food/drink, November 2012
- Older generations remain loyal to supermarkets
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- Figure 70: Retailers and channels shopped for food/drink, by generation, November 2012
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- Figure 71: Retailers and channels most often shopped for food/drink, by generation, November 2012
- For food/drink shopping, little variance in store-type patronage by gender
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- Figure 72: Retailers and channels shopped for food/drink, by gender, November 2012
- Figure 73: Retailers and channels most often shopped for food/drink, by gender and age, November 2012
- Income impacts sources of food/drink groceries
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- Figure 74: Retailers and channels shopped for food/drink, by household income, November 2012
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- Figure 75: Retailers and channels most often shopped for food/drink, by household income, November 2012
Retailers and Channels Shopped for Nonfood/Drink
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- Key points
- Big-box stores are “most shopped at” for home essentials and HBC
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- Figure 76: Retailers and channels shopped for nonfood/drink groceries, November 2012
- Mass merchandisers and club stores win over Millennials and Gen Xers
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- Figure 77: Retailers and channels shopped for nonfood/drink groceries, by generation, November 2012
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- Figure 78: Retailers and channels most often shopped for nonfood/drink groceries, by generation, November 2012
- Men and women buy household essentials/HBC at multiple channels, but most use Walmart
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- Figure 79: Retailers and channels shopped for nonfood/drink groceries, by gender, November 2012
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- Figure 80: Retailers and channels most often shopped for nonfood/drink groceries, by gender and age, November 2012
- Higher income groups continue to buy household items at supercenters/club stores
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- Figure 81: Retailers and channels shopped for nonfood/drink groceries, by household income, November 2012
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- Figure 82: Retailers and channels most often shopped for nonfood/drink groceries, by household income, November 2012
Change in Groceries Spending at Selected Retail Channels
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- Key points
- Increased spending at big-box/club stores and supermarkets
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- Figure 83: Change in spending this year vs. last at selected retailers/channels, November 2012
- Millennials, Gen Xers spend more on groceries through almost all channels
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- Figure 84: Spending more than last year at selected retailers/channels, by generation, November 2012
- Female primary grocery shoppers spend more on grocery spending
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- Figure 85: Spending more than last year at selected retailers/channels, by gender, November 2012
- Regardless of income, primary shoppers increase spending at discount stores
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- Figure 86: Spending more than last year at selected retailers/channels, by household income, November 2012
- Changes in grocery expenditures associated with presence of children
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- Figure 87: Spending more than last year at selected retailers/channels, by parents with children and age of children, November 2012
Grocery Shopping Saving Strategies
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- Key points
- Primary shoppers mostly use coupons to save grocery expenditures
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- Figure 88: Saving strategies when grocery shopping, November 2012
- Variances in saving strategies across generations
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- Figure 89: Saving strategies when grocery shopping, by generation, November 2012
- Female grocery shoppers adhere to saving strategies
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- Figure 90: Saving strategies when grocery shopping, by gender, November 2012
- Finding ways to save is on everyone's mind, even the richest
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- Figure 91: Saving strategies when grocery shopping, by household income, November 2012
- Money-saving strategies exercised at all channels, regardless of product type
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- Figure 92: Retailers and channels shopped for food/drink, by saving strategies when grocery shopping, November 2012
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- Figure 93: Retailers and channels shopped for nonfood/drink groceries, by saving strategies when grocery shopping, November 2012
Attitudes and Behaviors Toward Grocery Shopping
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- Key points
- Price and convenience are essential to encourage shopping
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- Figure 94: Attitudes and behaviors toward grocery shopping, by generation, November 2012
- Women drawn to convenience, price, and store experience
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- Figure 95: Attitudes and behaviors toward grocery shopping, by gender, November 2012
- Income correlates with consumers’ attitudes to grocery shopping
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- Figure 96: Attitudes and behaviors toward grocery shopping, by household income, November 2012
Innovations and Improvements Sought in the Grocery Shopping Experience
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- Key points
- Coupon and promotion customizations are most sought after
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- Figure 97: Innovations and improvements sought in the grocery shopping experience, November 2012
- Variations in demand for innovations by generations leads to opportunities
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- Figure 98: Innovations and improvements sought in the grocery shopping experience, by generation, November 2012
- Women keen for improvement in their shopping experience
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- Figure 99: Innovations and improvements sought in the grocery shopping experience, by gender, November 2012
Impact of Race and Hispanic Origin
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- Key points
- Black grocery shoppers tend to take sole responsibility for groceries
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- Figure 100: Grocery shopping responsibility, by race/Hispanic origin, November 2012
- Regardless of race, shoppers most likely buy food/drinks at supermarkets
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- Figure 101: Retailers and channels shopped for food/drink, by race/Hispanic origin, November 2012
- Figure 102: Retailers and channels most often shopped for food/drink, by race/Hispanic origin, November 2012
- For nonfood/drink products, high patronage at mass merchandisers/club stores
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- Figure 103: Retailers and channels shopped for nonfood/drink groceries, by race/Hispanic origin, November 2012
- Figure 104: Retailers and channels most often shopped for nonfood/drink groceries, by race/Hispanic origin, November 2012
- Black shoppers show highest likelihood of increased spend at Walmart
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- Figure 105: Spending more than last year at selected retailers/channels, by race/Hispanic origin, November 2012
- Black and Hispanic shoppers most likely to switch channels for better deals
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- Figure 106: Saving strategies when grocery shopping, by race/Hispanic origin, November 2012
- Blacks more influenced by price; Hispanics by store experience/convenience
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- Figure 107: Attitudes and behaviors toward grocery shopping, by race/Hispanic origin, November 2012
- Customized coupons are most favored by whites; Hispanic welcome more integration of digital technology in their shopping experience
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- Figure 108: Innovations and improvements sought in the grocery shopping experience, by race/Hispanic origin, November 2012
Appendix – Other Useful Consumer Tables
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- Grocery shopping decision makers
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- Figure 109: Grocery shopping responsibility, by region, November 2012
- Retailers and channels shopped for food/drink
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- Figure 110: Retailers and channels shopped for food/drink, by gender and age, November 2012
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- Figure 111: Retailers and channels shopped for food/drink, by marital/relationship status, November 2012
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- Figure 112: Retailers and channels most often shopped for food/drink, by marital/relationship status, November 2012
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- Figure 113: Retailers and channels shopped for food/drink, by parents with children and age, November 2012
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- Figure 114: Retailers and channels shopped for food/drink, by region, November 2012
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- Figure 115: Retailers and channels most often shopped for food/drink, by region, November 2012
- Retailers and channels shopped for nonfood/drink
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- Figure 116: Retailers and channels shopped for nonfood/drink groceries, by gender and age, November 2012
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- Figure 117: Retailers and channels shopped for nonfood/drink groceries, by marital/relationship status, November 2012
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- Figure 118: Retailers and channels most often shopped for nonfood/drink groceries, by marital/relationship status, November 2012
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- Figure 119: Retailers and channels shopped for nonfood/drink groceries, by parents with children and age of children, November 2012
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- Figure 120: Retailers and channels most often shopped for nonfood/drink groceries, by parents with children and age of children, November 2012
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- Figure 121: Retailers and channels shopped for nonfood/drink groceries, by region, November 2012
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- Figure 122: Retailers and channels most often shopped for nonfood/drink groceries, by region, November 2012
- Change in spend in grocery shopping
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- Figure 123: Spending the same/more than last year at selected retailers/channels, by generation, November 2012
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- Figure 124: Spending the same/more than last year at selected retailers/channels, by gender and age, November 2012
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- Figure 125: Spending more than last year at selected retailers/channels, by gender and age, November 2012
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- Figure 126: Spending the same/more than last year at selected retailers/channels, by household income, November 2012
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- Figure 127: Spending the same/more than last year at selected retailers/channels, by region, November 2012
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- Figure 128: Spending more than last year at selected retailers/channels, by region, November 2012
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- Figure 129: Spending the same/more than last year at selected retailers/channels, by marital/relationship status, November 2012
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- Figure 130: Spending more than last year at selected retailers/channels, by marital/relationship status, November 2012
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- Figure 131: Spending the same/more than last year at selected retailers/channels, by parents with children and age of children, November 2012
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- Figure 132: Spending the same/more than last year at selected retailers/channels, by race/Hispanic origin, November 2012
- Attitudes and behaviors toward grocery shopping
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- Figure 133: Attitudes and behaviors toward grocery shopping, by household income, November 2012
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- Figure 134: Attitudes and behaviors toward grocery shopping, by marital/relationship status, November 2012
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- Figure 135: Attitudes and behaviors toward grocery shopping, by parents with children and age of children, November 2012
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- Figure 136: Attitudes and behaviors toward grocery shopping, by region, November 2012
- Money-saving strategies in grocery shopping
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- Figure 137: Saving strategies when grocery shopping, by region, November 2012
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- Figure 138: Saving strategies when grocery shopping, by gender and age, November 2012
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- Figure 139: Saving strategies when grocery shopping, by marital/relationship status, November 2012
- Innovations and Improvements Sought in the Grocery Shopping Experience
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- Figure 140: Innovations and improvements sought in the grocery shopping experience, by gender and age, November 2012
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- Figure 141: Innovations and improvements sought in the grocery shopping experience, by marital/relationship status, November 2012
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- Figure 142: Innovations and improvements sought in the grocery shopping experience, by parents with children and age of children, November 2012
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- Figure 143: Innovations and improvements sought in the grocery shopping experience, by household income, November 2012
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- Figure 144: Innovations and improvements sought in the grocery shopping experience, by region, November 2012
Appendix – Social Media – Grocery Retailing
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- Brand usage or awareness
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- Figure 145: Brand usage or awareness, November 2012
- Figure 146: Walmart usage or awareness, by demographics, November 2012
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- Figure 147: Safeway usage or awareness, by demographics, November 2012
- Figure 148: Albertsons usage or awareness, by demographics, November 2012
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- Figure 149: Kroger usage or awareness, by demographics, November 2012
- Figure 150: Target usage or awareness, by demographics, November 2012
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- Figure 151: Costco usage or awareness, by demographics, November 2012
- Figure 152: Whole foods market usage or awareness, by demographics, November 2012
- Interaction with grocery retailing brands
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- Figure 153: Activities done, November 2012
- Figure 154: Walmart—Activities done, by demographics, November 2012
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- Figure 155: Walmart—Activities done, by demographics, November 2012
- Figure 156: Safeway – Activities done, by demographics, November 2012
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- Figure 157: Safeway – Activities done, by demographics, November 2012
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- Figure 158: Albertsons – Activities done, by demographics, November 2012
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- Figure 159: Albertsons – Activities done, by demographics, November 2012
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- Figure 160: Kroger – Activities done, by demographics, November 2012
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- Figure 161: Kroger – Activities done, by demographics, November 2012
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- Figure 162: Target – Activities done, by demographics, November 2012
- Figure 163: Target – Activities done, by demographics, November 2012
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- Figure 164: Costco – Activities done, by demographics, November 2012
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- Figure 165: Costco – Activities done, by demographics, November 2012
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- Figure 166: Whole foods market– Activities done, by demographics, November 2012
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- Figure 167: Whole foods market – Activities done, by demographics, November 2012
Appendix – Trade Associations
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