Continued uncertainty in the global economy is impacting on South African consumers' attitudes towards grocery pricing, with the majority of South African grocery shoppers exhibiting a high awareness of and sensitivity towards grocery prices, according to a report released by Nielsen, the leading global provider of information and insights into what consumers watch and buy.
Nielsen's Shopper Trends Report, which provides insights into the grocery shopping habits of consumers in South Africa, has revealed that more than two thirds of South African grocery shoppers are extremely price conscious when it comes to groceries. More than one quarter of South African grocery shoppers claim to know all of the prices of grocery items they regularly purchase, while 41 percent know the price of most items they buy on a regular basis and always notice price fluctuations.
"In the face of continuing economic uncertainty, South African shoppers are adopting a cautious approach to grocery purchases," observes Harsh Sarda, Executive Director, Customised Research, Nielsen. "An overwhelming majority of shoppers are sensitive to the price of groceries, and these shoppers are becoming savvier when it comes to purchasing items they need at the lowest price."
Nielsen's report highlights strong store loyalty amongst South African grocery shoppers, and most are unlikely to switch stores to chase promotional offers. The majority of grocery shoppers report a preference for actively seeking promotions within their usual grocery store, with price discounting identified as the most popular promotional activity. In terms of determining choice of grocery store, shoppers rank value for money, practical shopping trips and low prices as the most important drivers of store choice.
"Once shoppers identify a selection of stores they are comfortable with, they tend to stick to this repertoire," notes Sarda. "For grocery retailers, this highlights a growing importance to differentiate and offer exceptional customer service alongside competitive pricing."
Continued economic uncertainty and tighter household budgets also appeared to be influencing grocery shoppers' choice of brands. Just under a third of South African grocery shoppers felt the quality of store brands was equal to branded products and one quarter felt store brands offered good value for money.
Grocery shoppers were also unlikely to change their choice of branded products - 57 percent of shoppers occasionally trial new brands or products, but usually stuck to their favourite brands and products while a further 17 percent prefer to stick with familiar products.
As shoppers feel the impact of rising food prices, many have been forced to cut down on luxury items, according to the Nielsen report. More than half of shoppers report to have cut down on luxuries and only buy essential items.
Seventy percent of shoppers polled indicated that they prefer to do their main grocery shopping on a monthly basis, while 30 percent shop at least two to three times per week to top-up on groceries and 23 percent top-up once a week. Spaza shops are the most frequented outlets being visited four to five times per week, followed by supermarkets one to two times per week.
When asked about their attitude towards green products, just over half of South African grocery shoppers (53%) indicated they had not changed their purchasing habits of green products in the past year.
About Nielsen's Shopper Trends Report
The Nielsen Shopper Trends Survey interviewed 2516 modern trade grocery shoppers in South Africa in October 2011 about their general grocery shopping behavior.
The survey was conducted with the main grocery purchasing decision makers, as well as key influencers when it comes to what grocery products are purchased for the household, and is weighted to be representative of grocery decision-makers residing in urban South Africa.
Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and related properties. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA and Diemen, the Netherlands. For more information, visit www.nielsen.com