The internet is quickly becoming the virtual grocery store for many U.S. consumers with 52 million currently grocery shopping online, finds a new study from The NPD Group, a global information company.
According to the NPD report, 20 million consumers who are current, lapsed or new to online grocery shopping plan to increase their virtual shopping for foods and beverages over the next six months.
Although online grocery shopping lags other e-commerce industries in terms of development, the fundamental shift in the country’s demographics is one of the reasons there is now greater adoption of shopping for foods and beverages online, finds the NPD report, “The Virtual Grocery Store.”
Among the key groups favoring online grocery shopping are the younger generations, particularly Millennials and Gen Zs, who were born into the tech era. It’s second nature for these young adults to use the internet for all types of purchases. Online grocery shopping is especially appealing to Millennials who appreciate global cuisines and can find what they need online and see food shopping, prep and eating as an experience rather than just sustenance.
Those who shop online for groceries do so with a good deal of satisfaction, reports NPD. Over 60% are completely satisfied by the experience, a mere 6% are neutral or dissatisfied, and the others are somewhat satisfied.
Not surprisingly convenience is the top driver of satisfaction but online grocery shoppers also like the delivery options and shipping deals, like Amazon Prime, the infinite assortment and tax advantages.
“Food and beverage manufacturers should monitor the quickly changing landscape with respect to grocery delivery services and online retailers to ensure their products are part of the assortment where it matters,” said Darren Seifer, NPD food and beverage industry analyst. “Brick and mortar retailers also need to adjust to ensure they’re not losing out with younger tech savvy consumers. Now is the time to start developing e-commerce programs or to expand your current services. Whether a manufacturer or retailer, now is the time to act while shoppers are experimenting and there is significant growth on the horizon.”
Experian has released the findings of its Cross-Channel Marketing’s Q3 2016 Email Benchmark Report.
Among the highlights, the report examined year-over-year and quarter-over-quarter email marketing trends. The analysis found that total click rates have declined year-over-year for the past four quarters, while the percentage of clicks generated on mobile phones has increased during the same time period.
“As mobile usage continues to grow, brands need to prepare for the potential of declining overall click rates for the foreseeable future,” said Spencer Kollas, vice president of global deliverability for Experian’s Cross-Channel Marketing, which helps brands leverage customer data to empower insight-driven marketing. “With this in mind, marketers can better position themselves for success on the mobile platform by ensuring their call-to-action buttons are clearly visible and easy to use.”
- Fifty-six percent of total email opens occurred on mobile phones or tablets in Q3 2016, a 4% increase from a year ago.
- While email volume increased 19.8% year-over-year in Q3 2016, transaction rates, revenue per email and average order value all remained relatively steady during the same time period.
- Seventy-three percent of consumer products and services and 76% of multichannel retail brands had year-over-year gains in email volume in Q3 2016.
For a complimentary download of the full report, click here.
Major retail container ports are seeing a spike in business this month, as retailers are stocking up for the approaching holiday season.
The National Retail Federation’s monthly Global Port Tracker report has revealed that October is expected to be the second busiest month of this year for the nation’s major retail container ports. This major increase in port activity is the result of merchants working to stock up for the holiday shopping season.
“The holidays are nearly here, and from warehouses to store shelves, retailers are making sure they have the merchandise on hand to meet consumers’ demands,” NRF vice president for supply chain and customs policy Jonathan Gold said. “November and December are the busiest time for holiday shopping, but this is the month for the behind-the-scenes supply chain work that ensures shoppers will find what they want, where they want it, when they want it.”
Ports covered by Global Port Tracker handled 1.71 million 20-Foot Equivalent Units in August, the latest month for which after-the-fact numbers are available. That was up 5% from July and up 1.7% from August 2015, and has been the busiest month of the year so far. One TEU is one 20-foot-long cargo container or its equivalent.
Volume dipped in September to an estimated 1.64 million TEU but was still up 0.9% from last year. October is forecast at 1.65 million TEU, up 6% from last year; November at 1.54 million TEU, up 3.9%, and December at 1.48 million TEU, up 3.4%.
The numbers come as NRF is forecasting $655.8 billion in holiday sales, a 3.6% increase over last year. Cargo volume does not correlate directly to sales because only the number of containers is counted, not the value of the cargo inside. But it nonetheless serves as a barometer of retailers’ expectations.
Cargo volume for 2016 is expected to total 18.6 million TEU, up 2.1% from last year. Total volume for 2015 was 18.2 million TEU, up 5.4% from 2014. The first half of 2016 totaled 9 million TEU, up 1.6% from the same period in 2015.
January 2017 is forecast at 1.53 million TEU, up 2.7% from January 2016, and February is forecast at 1.47 million TEU, down 4.4% from last year.
After a long period of high inventory levels, Hackett Associates Founder Ben Hackett noted that the retail industry inventory-to-sales ratio stood at 1.49 in July, the latest number available from the U.S. Census Bureau. That was down from 1.5 in June and a peak of 1.52 in March.
“The inventory-to-sales ratio, one of the best indicators of where the economy is going, is finally declining,” Hackett said. “It’s not down by much, but the key is that the sharp rise seen earlier this year appears to have come to an end.”
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By Bill Scott, President, StoreReport LLC
The winner for the greatest advancement in positions is: Nestle Pure Life
Jumping up 267 positions to a ranking of 37, quite impressive for H2O. No other product even came close. Fuze Berry Punch one Liter rose 67 positons, followed by Kool Box, Powerade Lemon Line 32 ounce, Powerade Grape 32 ounce Powerade Orange and BudLight eight ounce 12 pack,
10 Pound Bag Ice did well climbing to position two. It’s rare to see Hunt Brothers Hunk knocked from the top of the list.
The top selling cigarettes are Marlboro Gold, Marlboro Special Blend and Newport in that order, with Little Debbie Honey Buns one count, hanging in there at position five– no change from the second quarter.
Dropping from the Top 100 List was NOS 16 ounce, Black & Mild Plastic Tip Orginal, Kimbles Corn Flake Chew. Ozarka Water 20 ounce, Little Debbie Mini Powdered Donuts, Red Bull 16.9 ounce, Black & Mild Cigars (070137809326), Fanta Srawberry 20 ounce, Peanuts Boliled 32 ounce and Little Debbie Mini Chocolate Donuts.
While holiday spending is expected to rise, it may not benefit store-based retailers as much as they would hope.
The new 2016 Holiday Outlook report from PwC has revealed that holiday spending is expected to reach its highest point since the Great Recession. According to the report, holiday spending will increase 10% over the 2015 holiday season.
However, the spending increase is not all good news for store-based retailers, as consumers stated they increasingly prefer to receive gifts of travel and entertainment rather than traditional gifts. The silver lining for retailers, though, is digital sales are expected to increase 25%. And consumers are moving towards smaller devices to carry out their online shopping, with mobile shopping up almost 25%. Additionally, Gen Z, who now represent the largest U.S. demographic, are heavy mobile users and they’re looking to buy tangible gifts more than experiences.
“The great news for all retailers is consumers are much more optimistic this holiday season,” said Steven Barr, PwC’s U.S. retail & consumer leader. “They are expected to spend 10% more on gifts, travel and entertainment. But it’s not all good news for store-based retailers because shoppers are expected to increase their digital shopping by 25%. They have also indicated they plan to shop at fewer physical stores as they concentrate their digital shopping to fewer web sites. The clear winners will likely be the major dot com destinations, including select store and leading brand web sites. The challenge for store-based retailers will likely be to leverage their distinctive advantages to stay relevant. Small, independent retailers and local artisans are expected to compete for consumers by offering personal service as well as unique and hand-made gifts. And, the larger format retailers are expected to provide the services and value that matter most to shoppers – including knowledgeable store associates, speedy check-out options, well stocked stores and great prices.”
PwC outlines the big trends that are expected to drive the 2016 holiday shopping season:
- Bigger holiday budgets: Shoppers will likely spend 10% more this holiday season; an average of $1,121 each. And consumers with annual household incomes less than $50,000 will likely increase their percentage spending levels even more than consumers overall.
- Chill for the holidays: Hipsters – upwardly mobile, college-educated Millennials living in enclaves such as Austin, Brooklyn, Oakland and Portland – will likely spend $500 more this season than consumers overall. And they will likely spend a hefty third of their holiday budget on themselves.
- Shopping is social for Gen Z: At 86 million strong, Gen Z’s influence is indisputable in the proliferation of interactive digital content, especially mobile video. These social media whiz kids are tactile; they like stuff – unlike Millennials who prefer experiences. Reviews from actual product users appeal to them while ads don’t.
- Millennial parents think of others first: Millennial parents – often juggling full-time jobs while caring for young children – are almost twice as likely as other consumers to use a mobile device to pay for purchases. Far more optimistic about the economy, they start shopping earlier than consumers overall and enjoy it more (75% versus 61%).
- Holiday time … and the buying is easy: Used to frictionless checkout online, customers want a similar fast and easy checkout experience in-store. They also want Wi-Fi access to check product availability and prices. And knowledgeable sales associates to help find products and explain features.
- Thumbs a-tapping in a mobile wonderland: Anticipating an almost 25% increase in annual digital sales, retailers are boosting their investment in digital channels. Meanwhile, mobile shopping is up almost 25% over last year. From scouting products and monitoring deals to paying for products and tracking packages, shoppers are going mobile.
- I want it … now: Some 60% of retailers indicated they will provide both free shipping and free returns this holiday season – a must-have for consumers. Retailers are offering a variety of online and in-store ordering and delivery (or pick-up) options to provide the optimum mix of convenience, price, speed, and variety.
- There’s always a deal … somewhere: As global borders shrink and the world’s population becomes more mobile, consumers shop year-round, lured by a flurry of deals and discounts. In fact, 64% of consumers indicated they will begin holiday shopping before the start of Black Friday week. And 29% will have completed most of it by then.
- Brands matter: Brands matter to 80% of the survey respondents – whether established household names, local businesses, independent retailers, or new entrants. Almost 75% of consumers plan to shop locally while 56% will seek independent retailers.
- Season of caring: Shoppers are expected to give an average of $244 to their favorite causes: health and social services, community development, animal welfare, and disaster relief. And 75% of retailers indicated they will make charitable contributions. Consumers said they favor retailers who are committed to corporate social responsibility.
- Pets get a gift, too: Pet owners – almost half of all households nationwide – are expected to buy gifts for their animal companions. They will likely spend an average of $62, although Millennials will likely outspend everyone else at $81 each.
PwC’s 2016 Holiday Outlook analyzes consumer and retailer reported data – and overlays the findings with additional PwC research and analysis. PwC’s national survey was conducted from July to September 2016, which polled 2,100-plus consumers, as well as 200 retailers.
The post A Number of Trends Expected to Drive Holiday Spending appeared first on Convenience Store Decisions.
Nielsen and EthniFacts are helping CPG marketers to market across various cultures.
A new resource has been released by Nielsen and EthniFacts to uncover the key consumer segments that provide a deeper understanding of consumers. The new Nielsen Intercultural Affinity Segmentation has combined Nielsen’s Homescan Panel with EthniFacts’ CulturSort cross-cultural survey to reveal that consumers, regardless of race and ethnicity, can think, act and buy outside of their root culture.
Through integration into Nielsen’s proprietary consumer and shopper marketing tools, including Homescan, Spectra and Total Shopper View, consumer packaged goods (CPG) marketers are able to measure and apply “total market metrics” across various cultures.
With the Nielsen Intercultural Affinity Segmentation, five key segments based on mindset, behavior and opportunity will be used to help marketers gain a deeper understanding of today’s intercultural consumer in the U.S. These five segments are:
- Monoculturals: Consumers who do not experience or participate in diverse lifestyles or tastes other than their root culture.
- Sideliners: Consumers who are aware of but generally uninvolved in diverse tastes and preferences, and often experience more opportunity and less avoidance of diverse experiences.
- Explorers: Consumers who experiment with and have tried diverse tastes and preferences on a limited basis.
- Enthusiasts: Consumers who are exposed and embrace diverse tastes and preferences. They are practicing, but not leading these experiences.
- Ambiculturals: Environment and lifestyle leaders, these consumers are considered influencers with effortless affinity to diverse tastes, preferences and high desire to share experiences with others.
“This groundbreaking approach to cultural segmentation helps marketers to understand the new American landscape, where a majority of the population is either multicultural or highly influenced by multicultural attitudes, products and trends,” said Aret Ratyosyan, product leader of North America Buy at Nielsen. “This tool will empower our clients–CPG manufacturers, marketers and retailers–to stay ahead of future trends by identifying what intercultural consumers are buying today in order to create effective marketing strategies that resonate with consumers who are highly influenced by multiple cultures.”
Beyond tracking the products that are resonating with consumers across various cultural segments, the Intercultural Affinity Segmentation also helps brands move away from traditional demographic-only models. For marketers, this means truly understanding and addressing cultural segmentation across U.S. consumers of all races and ethnicities. With this tool, doors to expanded opportunities are opened, offering CPG a broader view into measuring what resonates for the total multicultural influenced consumer–including non-Hispanic whites. This includes identifying the best distribution channels for those products, tracking marketing results by affinity across ethnic/racial groups uncovering potential cross-promotion opportunities and identifying trends in the highest intercultural affinity segments that may soon spread to all consumers.
“The Intercultural Affinity model is about majority marketing, not minority marketing. With over half of the U.S. population under the age of 50 now living in multicultural or blended households–those that include multiple races and ethnicities–this model provides a truer picture of the American mainstream,” said Mike Lakusta, CEO and founding partner at EthniFacts. “By identifying not only the mindset, but also the behavior and opportunity to buy outside one’s root culture, marketers can effectively activate Ambiculturals and other high intercultural affinity consumers who are most likely to be the influencers with the highest desire to share their diverse tastes and preferences and lead a product to going viral.”
Given the projected rise of multicultural consumers and multicultural influenced consumers in the U.S. in the decades ahead, these groups represent a significant spending power and should be high on brand marketers’ radars as the growth drivers of the future. Understanding and connecting with these audiences is critical for brands seeking to remain relevant in the years ahead.
The Nielsen-EthniFacts Hispanic Segmentation is currently available in the U.S.
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