India's modern trade environment is getting increasingly complex and competitive, according to the latest Nielsen ShopperTrends India report. Nielsen found that the number of customers frequenting supermarkets and hypermarkets has grown by 11 per cent in India's eight key metros compared to the last round of ShopperTrends conducted in November '07. The report further states that one-fifth of Indian shoppers are now spending most of their grocery rupees at supermarkets/hypermarkets.
However, while the Indian shopper continues to embrace the modern trade format, the rate of adoption has slowed in 2008 compared to 2007. Traditional grocery stores continue to dominate the Indian retail scene and are frequented more often by the Indian shoppers. While 39 per cent of grocery buyers visited a supermarket/hypermarket at least once in four weeks, 97 per cent of them visited a traditional store over the same period.
As far as store loyalty is concerned, expanding modern trade has given consumers more options to experiment, resulting in shoppers flirting across store banners. The repertoire of stores visited has increased amongst supermarket/ hypermarket shoppers, with more than one-fifth of them visiting four or more stores in a month.
Convenience is a strong driver of choice for India's shopper and the location of a store is a priority for them. The survey reveals that ease of accessing a store tops the list of attributes driving store choice among supermarket/ hypermarket shoppers. While more than half the shoppers are accustomed to visiting their regular store, almost an equal proportion of shoppers claim to have shopped at a store because of its sheer proximity.
A wide array of products is another factor driving store selection, addressing a basic need of 'everything I need in one shop'. The Nielsen survey also found it important to avoid stock-out situations and carry an assortment of product categories and brands.
While both value for money and low price are rated as important drivers of store choice, ShopperTrends found that value for money had a slight edge over low prices.
The survey also found that shoppers do not explicitly state promotions as a factor that influences their store choice. However, when their actual behaviour is considered, it is observed that attractive and interesting promotions play a vital role in store selection. Shoppers claiming to have checked the newspaper or flyers for coupons and then having gone to the store with attractive deals increased three-fold compared to last year.
While spending on total grocery has remained the same, the survey found that the proportion spent on fresh food, meats or vegetables have declined. Shampoos, detergents, biscuits, personal toiletries, hair oils and cooking medium were popular categories purchased in the modern trade format, while traditional trade remains the most preferred outlet type for all categories, according to the Nielsen ShopperTrends report.
The middle class consumer is increasingly shopping at the supermarket/hypermarket, according to Nielsen ShopperTrends. The shopper base spreads across socio-economic groups, with more than a quarter of customers today belonging to SEC C category. Supermarkets/hypermarkets are also the preferred destination for the younger males' shopping needs.
"In future, the successful retailers will be those who use this shopper information to target their growth via advertising, merchandising and promotional activities, and offer a product range that offers the best demographic fit with the shoppers who visit their stores," says Asitava Sen, director, retail consulting, The Nielsen Company, India, in an official communiqué.
For the record, Nielsen ShopperTrends India is conducted in the top eight metros in India (Mumbai, Delhi, Chennai, Kolkata, Bengaluru, Hyderabad, Ahmedabad and Pune) and three 20 lakh+ cities (Nagpur, Jaipur, and Indore). The target respondents included both main grocery buyers and influencers; males/females aged 15-65 years in SEC ABC households in the above cities. A sample size of 3,441 was used.