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Attitudes Toward In-store Promotion at FDM Outlets - US - May 2011

  • How can retailers capitalise on creating a ‘personalised’ shopping experience for consumers?
  • How can the impact of high food prices be counteracted through promotional innovation?
  • How can retailers engage with wealthier consumers through promotions?
  • How is mobile technology set to impact on the in-store experience?

This report is the first of its kind for Mintel. It builds on the analysis presented in Mintel’s Attitudes Toward Traditional Media Advertising and Promotion—U.S., September 2010, as well as the same title in August 2009.

For the purposes of this report, Mintel is covering in-store promotional activity and consumer response for all types of products (food and non-food) sold in FDM: food (e.g., supermarkets, including natural supermarkets and Trader Joe’s), drug stores, and mass merchandisers (e.g., Walmart, Target, and club stores.)

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Table of contents

  1. Scope and Themes

    • What you need to know
      • Definition
        • Data sources
          • Sales data
            • Consumer data
              • Abbreviations and terms
                • Abbreviations
                  • Terms
                  • Executive Summary

                    • High food prices and cautious consumers mean promotions continue to be important
                      • Consumers tired of coupon clipping also looking for improved in-store experience
                        • What some stores are doing
                          • Age and lifestyle affects how often consumers frequent store types
                            • Coupons are still most popular promotion, but digital deals becoming more accepted
                              • Good quality store brands increasingly attractive
                                • Digital displays in stores not yet effective, but will likely become so
                                  • Coupons most likely to affect purchases
                                  • Insights and Opportunities

                                    • Consumers experiencing promotion fatigue, looking for more
                                      • Personalized shopping
                                        • High food prices demand promotional innovation
                                          • Wealthier consumers can be reached through promotions
                                            • Mobile technology and the in-store experience
                                            • Inspire Insights

                                                • Trend: Guiding Choice
                                                • FDMx Sales and Advertising Revenues

                                                  • Key points
                                                    • Growth highest for deli, dairy, and HABA/health products
                                                      • Figure 1: FDMx sales across select departments, 2008-10
                                                    • Advertisers spend $168 billion in 2010
                                                      • Figure 2: U.S. advertising market by media revenue, 2010
                                                  • Market Drivers

                                                    • Key points
                                                      • High gas and food prices bring on new economic fears
                                                        • Over-55s segment grows, shows interest in in-store promotions
                                                          • Figure 3: Population, by age, 2006-16
                                                          • Figure 4: Population, by generation, 2011
                                                        • Hispanic population grows, but they are unlikely to examine in-store promotions
                                                          • Figure 5: Population by race and Hispanic origin, 2006-16
                                                        • Down economy continues to influence buying behavior
                                                          • Figure 6: Real disposable income, 2007-10
                                                      • Competitive Context

                                                        • Key points
                                                          • Buying online
                                                            • New media promotions
                                                              • Figure 19: Conscious impact of new media ads, by age, June–July 2010
                                                            • Promotion fatigue
                                                              • Experience as important as prices and promotions
                                                              • Case Study—Supermarkets

                                                                • Key points
                                                                  • Jewel-Osco
                                                                    • Dominick’s
                                                                      • Trader Joe’s
                                                                      • Case Study—Mass Merchandisers and Club Stores

                                                                        • Key points
                                                                          • Walmart
                                                                            • Target
                                                                              • Costco
                                                                              • Case Study—Drug Stores

                                                                                • Key points
                                                                                  • CVS
                                                                                    • Walgreens
                                                                                    • Innovations and Innovators

                                                                                      • Key points
                                                                                        • Harveys cultivates local relationships
                                                                                          • Target uses QR codes to reach out to consumers
                                                                                            • ShopRite uses food bloggers to promote store brands
                                                                                              • New apps create novel ways of engaging with customers
                                                                                                • The smell of shopping
                                                                                                  • Groceries through Groupon
                                                                                                  • Household Shopping at FDM Outlets

                                                                                                    • Key points
                                                                                                      • Who is the FDM shopper?
                                                                                                        • Figure 7: Shopping role in household, by various demographics, January 2011
                                                                                                      • Supermarkets are most frequented retailer
                                                                                                        • Figure 8: Shopping frequency at FDM outlets, January 2011
                                                                                                      • Older consumers rely on supermarkets, while younger consumers are interested in alternatives
                                                                                                        • Figure 9: Shopping frequency at supermarkets, mass merchandisers, convenience stores, and drug stores, by age, January 2011
                                                                                                      • Primary/shared shoppers report frequenting supermarkets at similar rates
                                                                                                        • Figure 10: Shopping frequency at supermarkets, mass merchandisers, convenience stores, and drug stores, by household income, January 2011
                                                                                                      • Respondents with children likely to frequent convenience stores
                                                                                                        • Figure 11: Shopping frequency at supermarkets, mass merchandisers, convenience stores, and drug stores, by presence and number of children, January 2011
                                                                                                      • Under-35s show interest in natural and gourmet food stores
                                                                                                        • Figure 12: Shopping frequency at dollar, club, natural food, and specialty/gourmet stores, by age, January 2011
                                                                                                      • Shoppers across income brackets frequent dollar stores
                                                                                                        • Figure 13: Shopping frequency at dollar, club, natural food, and specialty/gourmet stores, by household income, January 2011
                                                                                                      • Kids in the household mean more trips to the store
                                                                                                        • Figure 14: Shopping frequency at dollar, club, natural food, and specialty/gourmet stores, by presence and number of children, January 2011
                                                                                                      • Roughly one fourth of primary/shared shoppers have cut back on purchases
                                                                                                        • Figure 15: Shifts in shopping frequency at select FDM outlets, January 2011
                                                                                                      • 25-34s continue similar spending despite down economy
                                                                                                        • Figure 16: Shifts in shopping frequency at supermarkets, mass merchandisers, convenience stores, and drug stores, by age, January 2011
                                                                                                        • Figure 17: Shifts in shopping frequency at dollar, club, natural food, and specialty/gourmet stores, by age, January 2011
                                                                                                    • Ways the FDM Shopper Finds Out About Deals

                                                                                                      • Key points
                                                                                                        • Mail still important way to learn about discounts, but email and websites also effective
                                                                                                          • Figure 18: Ways the FDM shopper finds out about deals, by gender, January 2011
                                                                                                        • Older primary/shared shoppers use email to learn about promotions, younger respondents look at websites
                                                                                                          • Figure 19: Ways the FDM shopper finds out about deals, by age, January 2011
                                                                                                        • Affluent primary/shared shoppers learn about promotions through many mediums
                                                                                                          • Figure 20: Ways the FDM shopper finds out about deals, by household income, January 2011
                                                                                                      • Frequency of Evaluating/Considering In-Store Promotions

                                                                                                        • Key points
                                                                                                          • Primary/shared shoppers are highly likely to evaluate store brands every time they shop
                                                                                                            • Figure 21: Frequency of evaluating/considering in-store promotions, January 2011
                                                                                                          • Private labels popular with 25-34s
                                                                                                            • Figure 22: Frequency of evaluating/considering top five in-store promotions, by age, January 2011
                                                                                                          • Women aged 35-54 highly likely to consider in-store promotions when making purchasing decisions
                                                                                                            • Figure 23: Influence of in-store advertising on consumer behavior, by gender/age, April 2009–June 2010
                                                                                                            • Figure 24: Influence of in-store advertising on consumer behavior, by household income, April 2009–June 2010
                                                                                                          • Retailers have opportunity to reach out to Hispanic consumers through in-store promotions
                                                                                                            • Figure 25: Influence of in-store advertising on consumer behavior, by race/Hispanic origin, April 2009–June 2010
                                                                                                        • In-Store Promotional Triggers

                                                                                                          • Key points
                                                                                                            • Coupons are most likely to cause shoppers to buy
                                                                                                              • Figure 26: In-store promotional triggers, by gender, January 2011
                                                                                                            • Younger consumers not as likely to purchase products based on promotions
                                                                                                              • Figure 27: In-store promotional triggers, by age, January 2011
                                                                                                            • Earning more income means primary/shared shoppers are more willing to try promoted products
                                                                                                              • Figure 28: In-store promotional triggers, by household income, January 2011
                                                                                                            • Black and Asian primary/shared shoppers affected by video screen marketing
                                                                                                              • Figure 29: In-store promotional triggers, by race/Hispanic origin, January 2011
                                                                                                            • Coupons and fliers most likely to induce purchases
                                                                                                              • Figure 30: Money-saving options most likely to induce purchase, by age, January 2011
                                                                                                              • Figure 31: Money-saving options most likely to induce purchase, by household income, January 2011
                                                                                                          • Cluster Analysis

                                                                                                              • Disengageds
                                                                                                                • Demographics
                                                                                                                  • Characteristics
                                                                                                                    • Opportunity
                                                                                                                      • Young Value-centrics
                                                                                                                        • Demographics
                                                                                                                          • Characteristics
                                                                                                                            • Opportunity
                                                                                                                              • Mature Thrifties
                                                                                                                                • Demographics
                                                                                                                                  • Characteristics
                                                                                                                                    • Opportunity
                                                                                                                                      • Characteristic tables
                                                                                                                                        • Figure 32: Primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 33: Shopping role in household, by primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 34: Shopping frequency at supermarkets, mass merchandisers, convenience stores, and drug stores, by primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 35: Shopping frequency at dollar, club, natural food. and specialty/gourmet stores, by primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 36: Ways the FDM shopper finds out about deals, by primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 37: Frequency of evaluating/considering top five in-store promotions, by primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 38: In-store promotional triggers, by primary/shared household shopper clusters, January 2011
                                                                                                                                        • Figure 39: Money-saving options most likely to induce purchase, by primary/shared household shopper clusters, January 2011
                                                                                                                                      • Demographic tables
                                                                                                                                        • Figure 40: Primary/shared household shopper clusters, by gender, January 2011
                                                                                                                                        • Figure 41: Primary/shared household shopper clusters, by age, January 2011
                                                                                                                                        • Figure 42: Primary/shared household shopper clusters, by household income, January 2011
                                                                                                                                        • Figure 43: Primary/shared household shopper clusters, by race, January 2011
                                                                                                                                        • Figure 44: Primary/shared household shopper clusters, by Hispanic origin, January 2011
                                                                                                                                      • Cluster methodology
                                                                                                                                      • Custom Consumer Groups

                                                                                                                                        • Key points
                                                                                                                                          • Frequency of evaluating/considering in-store promotions, by “heavy,” “medium,” and “light” shoppers
                                                                                                                                            • Heavy shoppers more likely to evaluate all promotional types
                                                                                                                                              • Heavy shoppers more interested in private label brands at mass merchandisers
                                                                                                                                                • Figure 45: Frequency of evaluating/considering top five in-store promotions, by custom groups, January 2011
                                                                                                                                                • Figure 46: Evaluation frequency with other in-store promotions, by custom groups, January 2011
                                                                                                                                              • Heavy club store consumers look at sale items on display at end of aisles
                                                                                                                                                • Figure 47: Evaluation frequency with top five in-store promotions, by custom groups, January 2011
                                                                                                                                              • Heavy club and natural supermarket shoppers respond to video screens
                                                                                                                                                  • Figure 48: Evaluation frequency with other in-store promotions, by custom groups, January 2011
                                                                                                                                                • Heavy drug store users more likely to evaluate all promotional types every time they shop
                                                                                                                                                  • Figure 49: Evaluation frequency with top five in-store promotions, by custom groups, January 2011
                                                                                                                                                  • Figure 50: Evaluation frequency with other in-store promotions, by custom groups, January 2011

                                                                                                                                              Companies Covered

                                                                                                                                              • Amazon North America
                                                                                                                                              • Apple, Inc
                                                                                                                                              • BJ's Wholesale Club, Inc
                                                                                                                                              • Borders Group
                                                                                                                                              • Bureau of Economic Analysis
                                                                                                                                              • Burger King Corporation
                                                                                                                                              • Carrefour
                                                                                                                                              • Costco Wholesale Corporation
                                                                                                                                              • CVS Caremark Corporation
                                                                                                                                              • Dominick's Finer Foods
                                                                                                                                              • Facebook, Inc.
                                                                                                                                              • Family Dollar Stores, Inc
                                                                                                                                              • Food and Drug Administration
                                                                                                                                              • Foursquare
                                                                                                                                              • General Mills Inc
                                                                                                                                              • Google, Inc.
                                                                                                                                              • Groupon, Inc.
                                                                                                                                              • Hewlett-Packard Company
                                                                                                                                              • IKEA USA
                                                                                                                                              • Interactive Advertising Bureau (US)
                                                                                                                                              • Kraft Foods Inc. (U.S.A.)
                                                                                                                                              • Maytag Corporation
                                                                                                                                              • Mossimo, Inc.
                                                                                                                                              • PayPal Inc.
                                                                                                                                              • Pepsi-Cola North America
                                                                                                                                              • Safeway Inc
                                                                                                                                              • SAM's Club
                                                                                                                                              • Supervalu Inc
                                                                                                                                              • Target Corporation
                                                                                                                                              • The Conference Board
                                                                                                                                              • The New York Times Company
                                                                                                                                              • Trader Joe's Company Inc
                                                                                                                                              • Twitter, Inc.
                                                                                                                                              • U.S. Bureau of Labor Statistics
                                                                                                                                              • U.S. Bureau of the Census
                                                                                                                                              • US Department of Commerce
                                                                                                                                              • Wakefern Food Corporation
                                                                                                                                              • Walgreen Co
                                                                                                                                              • Walmart Stores (USA)
                                                                                                                                              • Wegmans Food Markets, Inc
                                                                                                                                              • Whole Foods Market Inc
                                                                                                                                              • YouTube, Inc.

                                                                                                                                              Attitudes Toward In-store Promotion at FDM Outlets - US - May 2011

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