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19 May 2008
Mumbai, India
Indian shoppers are going all out to embrace Modern Trade, according to the latest Nielsen ShopperTrends India report. While Modern Trade has grown 90 percent across India’s eight key metros, Nielsen has found that in the past year (Nov 2006-Nov 2007 period) the number of customers who have shopped at a supermarket or a hypermarket store in the span of four weeks has also nearly doubled over the same period. Spending at supermarkets has also seen a growth of 50 percent, according to Nielsen.
While the local grocer may be losing out on their share of customers’ wallets, supermarket shoppers continue to visit the local grocer - in fact more often than they did a year ago. The findings of the Nielsen survey indicate that shoppers generally use the Modern format for their weekly and monthly shopping needs and use traditional stores for “top-up” shopping.
“While the proximity of the local grocer gives it an advantage for top-up trips, retailers need to explore ways to encourage the supermarket/hypermarket channel for top-up/stand-alone trips to increase their bottom-line”, said Arti Verma, Associate Director, Client Solutions, The Nielsen Company, India.
Supermarket Shopping Basket
Shoppers exhibit differences in their spend allocation across product categories as well as their share of Modern Trade to Traditional Trade.
For Cooking Mediums, Detergents, Shampoos, Noodles, and Feminine Hygiene products, shoppers mostly prefer the Modern Trade to the traditional grocer. While the local vegetable market is still the primary destination of choice for fresh food, shoppers are increasingly shopping at supermarkets for fresh fruits and vegetables, with a substantial six times increase in shopping frequency for fresh food at supermarkets.
Store Loyalty
Increasing choice within the Modern format has resulted in shoppers flirting across store banners. The store repertoire – the number of supermarkets visited in past four weeks - has gone up from an average of 1.61 to 2.03. In addition, fewer shoppers say ‘they continue to shop at the same store they always shop at’.
“Expansion within and across cities is critical to maintain brand visibility. The Modern Trade is still new to Indian shoppers and hence they are going through a process of trial and error. While salience and presence helps stores build stronger equity in the market, shoppers in their quest for experimentation are keen to explore new stores. Certainly, the retailers who have expanded within and across cities have managed to garner greater footfall,” continued Verma.
Shopper Profile
As modern retail formats expand, they are no longer catering only to the upper socio-economic groups. The SEC A demographic now comprises less than half of the customer base, with both SEC B and more so SEC C seeing an increase in proportion. The young male, when he shops, prefers the supermarket to the neighbourhood store.
“The time has come for retailers to broaden their offering to cater to the needs of both their primary and secondary customers,” said Verma.
About the Survey
Nielsen ShopperTrends is conducted in the top eight metros in India (Mumbai, Delhi, Chennai, Kolkata, Bangalore, Hyderabad , Ahmedabad & Pune) and three 20lac+ cities - Nagpur, Jaipur, Indore (included in this read). The target respondents include both main grocery buyers and influencers; males/females aged 15-65 years in SEC ABC households in the above cities. A sample size of 3316 was used.
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
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