Black Consumers and Shopping for Groceries - US - November 2015

OVERVIEW
What you need to know
Definition
EXECUTIVE SUMMARY
In 2015, it’s estimated that Blacks will spend $61 billion on groceries
Figure 1: Expenditures of Black households on groceries* and fan chart forecast of market, at current prices, 2010-20
The issues
Kids weigh in on what goes into the cart, but parents have the final say
Figure 2: The role kids and family members play in grocery decisions, September 2015
Blacks are loyal to certain brands and stores; so what will it take to get others on their list?
Figure 3: Brand trust among Blacks – Net three for each statement, September 2015
Walmart is the top store Blacks shop, but it’s still not strongly associated with food
Figure 4: Correspondence analysis – Grocery shopping location and product category, September 2015
Blacks enjoy grocery shopping; they shop a variety of stores and often
Figure 5: Frequency of shopping grocery retailers – Once a month or more versus once a week or more, September 2015
The opportunities
Opportunity for smaller pop-up stores, fresh expansions
Engage Blacks; give them something to remember you by
Figure 6: Brand loyalty drivers, September 2015
Word of mouth is one thing; gifting favorite brands is another
Figure 7: Brand advocacy among Blacks, September 2015
Smart shopping tools, experiential displays and departments set retailers apart
Figure 8: Impact of in-store sampling on Blacks when shopping for groceries, September 2015
Figure 9: Impact of sales and buying in bulk for savings among Blacks when shopping for groceries, September 2015
What it means
THE MARKET – WHAT YOU NEED TO KNOW
Blacks spend $61 billion on groceries; food and drink make up the bulk
Coupons, expansions, and sampling . . . Oh my!
Things are looking up for Black consumers, retailers expected to benefit
MARKET SIZE AND FORECAST
Blacks spend $61 billion on groceries
Figure 10: Expenditures by Black households on groceries* and fan chart forecast of market, at current prices, 2010-20
Recession recovery and category changes made sales soar in 2011-12
Figure 11: Expenditures and forecast by Black households on groceries*, at current prices, 2010-20
MARKET BREAKDOWN
Food and drink segment represents 69% of sales in the category
Figure 12: Expenditures by Black households on groceries*, by segment, at current prices, 2013 and 2015
Food and drink segment has grown by 20% in the last five years
Figure 13: Expenditures by Black households on food and drink* and fan chart forecast of segment, at current prices, 2010-20
Tempered growth forecast for general merchandise, household supplies
Figure 14: Expenditures by Black households on general merchandise* and fan chart forecast of segment, at current prices, 2010-20
Health and beauty care products
Figure 15: Expenditures by Black households on health and beauty* and fan chart forecast of segment, at current prices, 2010-20
MARKET PERSPECTIVE
Coupon usage is up, digital credited
Mass merchandisers gaining momentum, but at what sacrifice?
Store brands can stake a claim, experiences are key
MARKET FACTORS
Greater number of Black households means more grocery carts
Figure 16: Number of households in US, by race/Hispanic origin of householder, January 2015
Consumer confidence at lowest point in a year, Blacks remain optimistic
Figure 17: Consumer confidence among the total US population, January 2007-September 2015
Frequent shopping promotes impulse purchases
Unemployment rates for Blacks near prerecession levels
Figure 18: Labor force participation and unemployment rates among the Black population (seasonally adjusted), January 2007-June 2015
KEY PLAYERS – WHAT YOU NEED TO KNOW
Brand extensions, expansions and packaging design are appealing
Online shopping, natural grocery stores, private label struggling
The future is sensorial, entertaining, and smarter
WHAT’S WORKING?
Brand extensions
Figure 19: Examples of brand extensions, 2015
Packaging
Figure 20: Examples of flexible and pouch packaging, 2015
Store expansion
Figure 21: Distribution of expenditures for food for off-premise consumption among the total population – Food and drink retailing only, 2015 (est)
Figure 22: Distribution of expenditures for food for off-premise consumption among the total population – Food and drink retailing only, 2005-15
WHAT’S STRUGGLING?
Shopping online for groceries and internet grocery retailers
Natural grocery stores
Store brands and private label
WHAT’S NEXT?
Seeing is believing; sensorial packaging
More smart grocery tools
Grocery shopping as a social outing
THE CONSUMER – WHAT YOU NEED TO KNOW
Women often make decisions alone, but they aim to please
One-stop shopping is attractive, but old habits die hard
Low prices are fine, but more is needed to attract Blacks
Understanding what’s in their cart gives a glimpse of who they are
GROCERY SHOPPING STAKEHOLDERS
Women more likely than men to make decisions on grocery shopping
Figure 23: Who is responsible for purchasing groceries in Black households, by gender, September 2015
Married couples value their spouse’s opinion on what to buy
Figure 24: Who is responsible for purchasing groceries in Black households, by marital status, September 2015
Special request welcomed in some Black households
Figure 25: Family influence in grocery shopping decisions, September 2015
Kids’ preferences influence what goes into the cart
Figure 26: Children’s influence in grocery shopping decisions, September 2015
GROCERY SHOPPING DESTINATIONS
Mass merchandisers more associated with nonfood items than food
Figure 27: Correspondence analysis – Grocery shopping location, September 2015
Walmart is the leader among mass merchandisers, competing with grocers
Figure 28: Grocery shopping location, by category, September 2015
FREQUENCY OF SHOPPING BY LOCATION
Blacks shop supermarkets more frequently than any other store
Figure 29: Frequency of shopping for groceries at supermarkets, September 2015
Internet grocery retailers struggle among Blacks
Figure 30: Frequency of shopping for groceries at nontraditional or specialty stores, September 2015
Significant differences in where Blacks shop each week by region
Figure 31: Frequency of shopping for groceries – Once a week or more, by location, by region, September 2015
Demographics impact frequency of visits on a monthly basis
Figure 32: Frequency of shopping for groceries – Once a month or more, by select locations, by gender, September 2015
Figure 33: Frequency of shopping for groceries – Once a month or more, by select locations, by age, September 2015
GROCERY CHAIN LEADERS BY REGION
Club stores among the top five stores Blacks shop for groceries
Figure 34: Top five stores Blacks shop at for groceries, by region, April 2014-June 2015
Value-priced stores give Walmart a run for the money, especially among Blacks
Figure 35: Top five stores Blacks shop at for groceries – Index to total, by region, April 2014-June 2015
IMPACT OF PROMOTIONS
Promotions draw Blacks, sampling works for some
Figure 36: Impact of in-store sampling and promotions on Blacks when shopping for groceries, September 2015
Sales influence some, buying in bulk is where the real savings are
Figure 37: Impact of in-store sampling and promotions on Blacks when shopping for groceries, September 2015
Demographic impact perception of marketing influences
Figure 38: Influence of coupons and bulk sizes when shopping for groceries – Net three for each statement, by key demographics, September 2015
Price doesn’t trump brand names, will shop around for best deal
Figure 39: Impact of price on driving Blacks to purchase – Index to total, February 2014-March 2015
GROCERY SHOPPING ENGAGEMENT
Blacks love to grocery shop; they shop often, alone, and at many stores
Figure 40: Grocery shopping patterns and behaviors, September 2015
Blacks take their time and shop as an escape, for inspiration, and to jog memory
Figure 41: Shopping engagement and enjoyment – Index to total, February 2014-March 2015
Blacks go above and beyond to promote brands they love
Figure 42: Brand advocacy among Blacks, September 2015
ATTITUDES TOWARD FOOD AND NUTRITION
Blacks quick to try products, but still struggle with proper diet and nutrition
Figure 43: Black consumers’ attitudes toward diet and nutrition – Index to total population, February 2014-March 2015
Blacks not drawn to natural and organic foods, taste may be barrier
Figure 44: Black consumers’ attitudes toward organic and natural foods – Index to total, February 2014-March 2015
WHAT’S IN THEIR CART
Blacks more likely than others to eat margarine
Figure 45: Top dairy products Black households eat – Index to total, April 2014-June 2015
Iced tea, juice, and nondiet carbonated beverages are must-haves
Figure 46: Top beverages Black households drink – Index to total, April 2014-June 2015
Blacks love sweets, frozen desserts at top of list
Figure 47: Top snacks and desserts Black households eat/use – Index to total, April 2014-June 2015
Blacks twice as likely to buy turkey parts, a key ingredient in soul food
Figure 48: Top meats Black households eat – Index to total, April 2014-June 2015
Blacks more likely to buy frozen foods, convenience a key driver
Figure 49: Top frozen foods Black households eat – Index to total, April 2014-June 2015
Bagged salad is popular among Blacks, saves prep time
Figure 50: Produce, bagged/packaged salad consumption among Black households, April 2014-June 2015
Blacks more likely to eat hot breakfast cereal; oatmeal and grits likely in cart
Figure 51: Leading cold cereal brands among Blacks – Index to total, April 2014-June 2015
Figure 52: Consumption of bread, seasoning, and dry goods among Black households – Index to total, April 2014-June 2015
Pork and beans a staple on Blacks’ shelves, more so than total population
Figure 53: Top canned good products Black households eat – Index to total, April 2014-June 2015
Blacks over index on gravy and sauces compared to total population
Figure 54: Top sauces and condiments Black households eat – Index to total, April 2014-June 2015
BRAND LOYALTY DRIVERS
Blacks loyal to brand names, longevity in the market gains trust
Figure 55: Brand trust among Blacks – Net three for each statement, September 2015
Blacks have no problem finding brands they love, they shop around to find them
Figure 56: Accessibility to preferred brands, September 2015
Good customer service, integrity, open communication gains repeat store visits
Figure 57: Brand loyalty drivers, September 2015
APPENDIX: DATA SOURCES AND ABBREVIATIONS
Data sources
Expenditure data
Definition
Fan chart forecast
Consumer survey data
Correspondence analysis methodology
Abbreviations and terms
Abbreviations
Terms
APPENDIX: THE MARKET
Figure 58: Expenditures by Black households on groceries*, at inflation-adjusted prices, 2010-20
Figure 59: Expenditures by Black households on groceries*, by segment, at current prices, 2010-20
Figure 60: Expenditures by Black households on food and drink*, at current prices, 2010-20
Figure 61: Expenditures by Black households on food and drink*, at inflation-adjusted prices, 2010-20
Figure 62: Expenditures by Black households on general merchandise/household supplies*, at current prices, 2010-20
Figure 63: Expenditures by Black households on general merchandise/household supplies*, at inflation-adjusted prices, 2010-20
Figure 64: Expenditures by Black households on health and beauty care products*, at current prices, 2010-20
Figure 65: Expenditures by Black households on health and beauty care products*, at inflation-adjusted prices, 2010-20
APPENDIX: CONSUMER
What’s in their cart
Figure 66: Kinds of condiments and seasonings used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 67: Kinds of baking ingredients used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 68: Kinds of dairy products used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 69: Kinds of frozen foods used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 70: Types of canned goods household uses used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 71: Types of bread and pastries used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 72: Dry goods, shelf-stable and oil used – Index to total, by race/Hispanic origin, April 2014-June 2015
Figure 73: Fresh or refrigerated produce used – Index to total, by race/Hispanic origin, April 2014-June 2015
Attitudes toward food
Figure 74: Black consumers’ attitudes toward food – Index to total, April 2014-June 2015
Attitudes toward shopping
Figure 75: Black consumers’ attitudes toward shopping – Index to total, February 2014 -March 2015