CONSUMERS SHOPPING MORE, VARYING VENUES
Byline: Vicki M. Young
NEW YORK — Consumers are shopping at more outlets a week, but their definition of “outlet” is less likely to include department stores and more likely to include destinations not even considered stores.
That’s one of the conclusions of the 1999/2000 WSL Strategic Retail survey on How America Shops, released last month. According to the survey’s findings, the emerging credo of the American consumer is, “I shop, therefore I am.” But where they shop and what they buy in these locations are increasingly subject to change.
Consumers have integrated shopping into every aspect of their lives, buying a sandwich and book at a bookstore, T-shirts for kids at a ball game, browsing online instead of watching television and reading catalogs in bed. Since 1996, the survey found, consumers have doubled the number of places they shop during their weekly shopping trips. They bought from 2.9 outlets a week in 2000, up from 2.4 in 1998 and 1.4 in 1996. Consumers, however, aren’t making more trips each week — which held steady at 3.5 both in 2000 and 1998 — they’re just making more stops on each trip.
Drugstores are the new convenient retail outlet of choice, while department stores have lost their core categories — with the exception of apparel — to mass merchandisers and specialty stores. The percentage of shoppers who bought at department stores hit a low of 72 percent in 2000, down from a high of 85 percent in 1996.
Overall, American women still do most of their shopping at the supermarket/food-drug store combo, but the percentage dropped to 76 from 82 in 1998. More than half, or 55 percent, now shop at a mass merchandise discounter once a week, up from 39 percent in 1998. And more than one in five, or 22 percent, made weekly visits to the drug store, compared with 11 percent in 1996.
Consumers are shopping more at Wal-Mart, Kmart and Target, mostly because consumers are demanding both price and convenience at the same time. Consumers want the most bang for the buck, but no longer go out of their way to get it. The presence of mass merchandisers also has an impact on other shopping venues. The percentage of consumers shopping at the malls dropped to 57 percent in 2000 from 76 percent in 1998. Even warehouse clubs declined to 35 percent from 47 percent two years ago. And discount clothing stores also dropped to 29 percent form 39 percent in the same period, according to the survey.
When shopping for clothes, department stores fared better because they are still viewed as the apparel outlet of choice. However, these days that’s not necessarily a title worth having. That’s because there’s a demographic divide in the apparel buying habits of at least two generations of consumers.
Although shoppers aged 55 and 70 do buy what they wear from department stores, they’re actually buying fewer clothes and shopping less at that channel overall. Older consumers shop more selectively and spend their discretionary funds on items other than apparel and beauty products. Their younger counterparts, shoppers aged 18 and 34, don’t consider department stores as the purveyors of fine fashion, even though they’re shopping more across all distribution channels.
To be sure, department stores may be their own worst enemy. The survey concluded that they’re contributing to their problems by focusing their attention on attracting the youth market, while leaving older consumers out in the cold. But with mature consumers controlling 50 percent of the disposable income in the U.S., according to the report, the older, disenfranchised consumer reacts by not shopping.
Retailers are challenged by how to create multiple reasons for consumers to think of their stores as the destination place to shop. When done right, the survey noted, the creation of multiple layers of value makes it harder for a competing outlet to entice the customers away. A store that satisfies a consumer’s emotional needs by providing experience and community, such as Barnes & Noble, has a better chance of converting the shopper to a repeat customer.
Mass merchants found their original discount stores were limited because the huge store formats were inconvenient if all a customer needed was to quickly buy a few things. However, the concept of brand names at “everyday low prices” in many formats — Wal-Mart Supercenters, Wal-Mart Neighborhood Market, Wal-Mart.com and Sam’s — held appeal because of the ability to attract and keep a broader pool of customers. Gap had Gap, Old Navy, Banana Republic and Gap.com.
Besides providing an improved shopping environment, retailers can also grab the attention of customers by creating a brand image that more effectively mirrors the attitudes of their customer base, the study said.