growth channels & the impact on checkout categories
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Growth Channels & The Impact On Checkout Categories. November 2012. [email protected] Twitter: BryanRoberts72 www.kantarretailiq.eu. Shoppers Driving Discounter & Online Growth. Discounters and online to drive growth. €1,951. €1,548. €1,357. - PowerPoint PPT PresentationTRANSCRIPT
Growth Channels & The Impact On Checkout Categories
November 2012
Twitter: BryanRoberts72
www.kantarretailiq.eu
© Copyright 2012 Kantar Retail
Shoppers Driving Discounter & Online GrowthDiscounters and online to drive growth
Source: KantarRetailIQ.eu
€1,951
€1,548
€1,357
*Chains: Data represents the over 500 European retail chains that Kantar Retail tracks and forecasts, generally these are chains with annual turnover exceeding EUR 1 billion
2
© Copyright 2012 Kantar Retail
The Impact of ‘Where’
3
Within global grocery, smaller stores are winning
2,700
2,720
2,740
2,760
2,780
2,800
2,820
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Average Store Size
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Big Boxes Not a Great Deal of Fun in Mature Markets
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Source: Carrefour
© Copyright 2012 Kantar Retail
Reasons for the Big Box Decline
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Non-food lines available through price-competitive online channels
Better service-led offer from specialist retailers
Some categories (music, DVD, gaming) are transitioning to non-physical delivery/consumption
Economic pressures are impacting discretionary spending/non-food demand
Shoppers are less willing to devote time travelling to out-of-town stores or navigating a 10,000 square metre store
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Reasons for the Big Box Decline
6
Rising numbers of grocery trips are transitioning to online/Drive
Aging populations less amenable to big box experience
Petrol prices making out-of-town travel more expensive
Decline in meal planning/large basket trips
Reluctance from shoppers to invest in household inventory
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This Trend is Bad News for the Hotzone
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8
Other Checkout Trends are Equally Dispiriting 64% of self-checkout grocery
shoppers said retailers who offer self-checkout options provide better customer service
78% of self-checkout users prefer them because they are faster
Certain impulse items can be found in 5% of baskets processed through regular checkouts, but in only 2% of self-checkout baskets
Source: NCR; Kantar Retail
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The Lure of Proximity – the Shopper
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Urbanization Longer working hours – little & often trips Rising petrol prices Growth in out-of-home food & drink Decline in home meal planning Decline in pantry/trolley shopping
-e.g. average of nine grocery shopping trips per household per week in the UK
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This Trend is Also Bad News for the Hotzone
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Rapid Discount Growth Creates Issues
Fewer checkouts than supers & hypermarkets
Skew towards PL at checkout
Historically poor at impulse / checkout shopper marketing
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– Aldi has installed branded confectionery / gum
Some Signs of Progress …
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Explosive Growth of Online is a Worry
Shopper marketing less advanced online Lack of impulse / adjacency Compete: 32% of shoppers prefer online, as it
removes temptation Few retailers successfully recommend linked items Trip disruption!
- Example: Ocado theoretically removes six million shopping trips per year from the UK market
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Some Positives Though Non-food click & collect will drive
traffic Smaller stores increasingly part of
the multichannel solution Pick-up points often at impulse-
heavy check-outs 70% of pick-up shoppers make in-
store purchase
Increasing use of pick-up lockers by the likes of Amazon
Likely to drive footfall into impulse-rich c-stores, CTNs & drugstores
© Copyright 2012 Kantar Retail
Now What?
Acknowledge that hypermarket traffic will be stagnant or declining in many markets: perhaps consider devoting more shopper marketing resource to other channels
Develop counter-top merchandising solutions for smaller stores
Improve abilities to develop FSDUs for use in proximity stores
Clip-strips—when executed correctly—are excellent for creating impulse in the small store environment
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Create merchandising solutions for queuing areas for both regular and self-checkouts
Implement an impulse strategy for the discount channel—FSDUs and checkout displays are options here
Collaborate with retailers to create impulse/adjacency in the online environment
Development of merchandising solutions for Click & Collect pick-up points?
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Now What?
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Monitor the implementation of Amazon Lockers – will there be greater impulse opportunities at Amazon’s retailer partners?
Consider on-screen impulse merchandising for self-checkouts
Work with retailers and/or self-checkout vendors to develop merchandising solutions for self-checkout units
Create smartphone marketing strategies to anticipate the adoption of smartphone self-scanning by more retailers/shoppers
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Now What?