"Good Value” Is The Top Influencer of U.S. Grocery Store Choice, Nielsen Reports

Worldwide, Grocery Shoppers Agree: Value Is More Important than Product Selection, Location, Convenience and Environmental Friendliness.

Schaumburg, IL.-Good value is the most important factor in determining where global consumers spend their grocery dollars, according to a study by The Nielsen Company. Sixty percent of U.S. consumers rank “good value for money” as the most important consideration when choosing a grocery store; eighty-five percent of global consumers agree.

Nielsen’s research shows that after “good value,” 28 percent of U.S. consumers choose grocery stores based on the selection of high quality brands and products while 23 percent choose the grocery store that is closest. Fourteen percent of U.S. consumers choose the most convenient store with easy parking and nine percent choose a store based on its use of recyclable bags and packaging.

“Our research offers a unique global snapshot of shopping habits and the motivations behind grocery shopping behavior today,” said Todd Hale, senior vice president of Consumer & Shopping Insights, Nielsen Consumer Panel Services. “What shoppers demand from grocery retailers varies significantly across regions and countries, and with increasing consolidation and globalization of the retail industry, it’s crucial for retailers to understand how shopper preferences differ across markets.”

In contrast to the habits of U.S. shoppers, Nielsen finds that Malaysian shoppers prefer supermarkets which offer the most convenient/easy parking, South Koreans, Indonesians and Germans like to shop at the supermarket closest to them, Russians and Indians seek out supermarkets offering a better selection of high quality brands and products, while Filipinos and Singaporean shoppers top global rankings for placing the most importance on getting good value for money.

Selection, Selection, Selection
The second most important attribute for U.S. shoppers, as well as shoppers around the world, is a supermarket that offers a better selection of high quality brands and products.

“This is a perfect example of today’s conflicted shopper,” said Hale. “Demanding shoppers expect the best of both worlds from retailers today. On one hand, we’re all natural bargain hunters and insist on good value for our grocery dollar, and on the other hand, we expect retailers to stock a wide selection of high quality brands and products so we can indulge in our favorite premium treats. Consumers want the ‘cheapest of the cheap’ in some categories and the ‘best of the best’ in others.”

Highest rankings for choosing a supermarket that offers a better selection of high quality brands and products are consumers in the world’s booming economies of Russia (93 percent), India (79 percent), China (78 percent) as well as the emerging Baltic countries Latvia (78 percent) and Lithuania (77 percent)—sending a clear message to retailers operating in or entering those markets and a sharp contrast with the 28 percent of U.S. shoppers who select stores on that basis.

“In fast-growing, emerging markets, there are large numbers of consumers with growing disposable incomes and newly acquired, discerning tastes,” said Hale. “These consumers want premium international grocery products in their shopping baskets and seek out supermarkets with a better offering of high quality, branded products.”

Defining Good Value
For consumers citing “good value” as their most important consideration, Nielsen finds that price, promotions and perceptions are most influential in helping consumers define value.

Eighty percent of U.S. shoppers consider it very important or somewhat important for supermarkets to feature frequent promotions and price discounts, while 72 percent believe a store’s reputation for delivering low prices—even if, in reality, this is not the case—is very or somewhat important. Ranking third are prices published in the stores’ leaflets (71 percent) and everyday low prices (70 percent.) Slightly less important to U.S. consumers are discounts for store card holders (63 percent), price comparison across retailers (59 percent), private label offerings (53 percent) and friends’ recommendations (43 percent.)

“Our research shows that the importance of good value and low prices resonates much more with lower income households in the U.S.” said Hale. “More affluent households regard quality of fresh produce, meat and seafood and selection above good value. That said, the success of warehouse club retailers speaks loudly to the importance affluent American consumers place on value.”

According to Nielsen’s research, three in four consumers around the world consider it very or somewhat important that supermarkets feature frequent promotions and regular price discounts, and seventy percent vote it very or somewhat important the store have a reputation for being cheaper than competitors. In third place are prices published in the stores’ leaflets (62 percent), followed by research and price comparisons across retailers (60 percent), price reductions offered through loyalty/store cards (57 percent) and stores that promised to have every day low prices (57 percent).

Interestingly, some consumers are not attracted to promotions and regular price discounts. One in four (22 percent) Finnish shoppers do not consider price promotions and discounts to be important and the emerging European economies of Russia, Hungary and Estonia share this view.

“The retail and media trade are both highly fragmented in Russia’s urban centers and it’s difficult for consumers to receive and access information on price discounts and promotions,” said Hale. “The main reason Russian shoppers aren’t interested in promotions and regular price discounts is simply that they don’t know about them because advertising and promotional channels are still under-developed.”

About the Study
Conducted twice a year among 26,486 internet users in 47 markets in Europe, Asia Pacific, the Americas and the Middle East, Nielsen most recently surveyed consumers on the factors that influenced their choice of grocery store.

About The Nielsen Company
The Nielsen Company is a global information and media company with leading market positions in marketing information (ACNielsen), media information (Nielsen Media Research), online intelligence (NetRatings and BuzzMetrics), mobile measurement, trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with headquarters in Haarlem, the Netherlands, and New York, USA. For more information, please visit, www.nielsen.com.

147 Markets Covered: Argentina, Australia, Austria, Belgium, Brazil, Canada, Chile, China, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Germany, Greece, Hong Kong, Hungary, India, Indonesia, Ireland, Italy, Japan, Latvia, Lithuania, Malaysia, Mexico, Netherlands, New Zealand, Norway, Philippines, Poland, Portugal, Russia, Thailand, Singapore, South Africa, South Korea, Spain, Sweden, Switzerland, Taiwan, Turkey, UAE, United Kingdom, US and Vietnam.