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The Budget Shopper - US - November 2017

"The majority of consumers practice budgeting, in some form, with some doing so out of necessity and others doing so as a way to save and plan ahead. Budget shoppers are highly motivated by price, and will put in the work to score a deal and find the best prices. They’re willing to shop around across multiple retailers and brands, making it a challenge to build loyalty; however, there’s an opportunity for retailers to unlock the potential of store brands and offer new ways to help consumers stay on track with their spending without resorting to constant promotions."
- Alexis DeSalva, Retail & Apparel Analyst

This Report looks at the following areas:

  • Fierce competition is challenging value-focused retailers
  • Budget shoppers are more focused on price, less on brand loyalty

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Table of contents

  1. Overview

    • What you need to know
      • Definition
      • Executive Summary

        • The issues
          • Fierce competition is challenging value-focused retailers
            • Figure 1: Retailers shopped, August 2017
          • Budget shoppers are more focused on price, less on brand loyalty
            • Figure 2: Influence on shopping, August 2017
          • The opportunities
            • Unlocking store or generic brands
              • Figure 3: Budgeting actions, August 2017
            • Appealing to all types of budget shoppers
              • Figure 4: Budgeting behaviors, by age and household income, August 2017
            • What it means
            • The Market – What You Need to Know

              • Financial situations could impact consumers’ need to budget
                • Planning ahead
                • Market Factors

                  • Optimistic market factors could impact consumers’ willingness to spend
                    • Figure 5: Consumer Sentiment Index, January 2007-September 2017
                  • The election has made some rethink their finances
                    • Figure 6: Election impact on household income and cost of living, by select demographics, May 2017
                  • Diverse households lead to diverse shopping needs
                    • Figure 7: Number of households, by race and Hispanic origin of householder, 2006 and 2016
                  • Preparing for the unknown
                  • Key Players – What You Need to Know

                    • Budget shoppers are frequenting mass and grocery
                      • Value-focused retailers feel the pressure of rising competition
                        • A shift away from name brands
                        • What’s Working?

                          • Changes at mass and grocery are capturing the attention of budget shoppers
                            • Figure 8: Retailers shopped, August 2017
                            • Figure 9: Walmart email campaign, August 2017
                            • Figure 10: Amazon email campaign, September 2017
                        • What’s Struggling?

                          • Value-oriented channels are losing budget shoppers to competitors
                            • Figure 11: Retailers shopped, August 2017
                        • What’s Next?

                          • New competition arises from current players
                            • Figure 12: Target email campaign, September 2017
                          • An emergence of affordable, nameless brands could threaten some current store brands
                            • Figure 13: Influence on shopping, by age, August 2017
                          • Publicizing assortment, not price, at value-oriented retailers
                            • Helping budget shoppers narrow down their options
                            • The Consumer – What You Need to Know

                              • Most consumers are budgeting more or the same
                                • Budget shoppers enjoy deal-seeking and are planning for the future
                                  • Mass and grocery are preferred by budget shoppers
                                    • Experiences are worth splurging on
                                    • Budgeting Behaviors

                                      • Budgeting means different things, to different people
                                        • Few consumers rarely budget
                                          • Figure 14: Budgeting behaviors, August 2017
                                        • Younger consumers are more budget conscious, regardless of income
                                          • Figure 15: Budgeting behaviors, by age and household income, August 2017
                                        • Retirees and older consumers not tied to a budget
                                          • Figure 16: Budgeting behaviors by select demographics, August 2017
                                        • Blacks and Hispanics are more likely to budget
                                          • Figure 17: Budgeting behaviors, by race and Hispanic origin, August 2017
                                      • Reasons for Budgeting

                                        • Most consumers enjoy the thrill of deal-seeking
                                          • Figure 18: Reasons for budgeting, August 2017
                                        • Long-term planning and debt reduction key budget drivers
                                          • Figure 19: Reasons for budgeting, by gender, August 2017
                                          • Figure 20: Reasons for budgeting, by gender and current marital status, August 2017
                                        • Older consumers enjoy the hunt for deals
                                          • Figure 21: Reasons for budgeting, by age, August 2017
                                        • Blacks and Asians are saving, but for different reasons
                                          • Figure 22: Reasons for budgeting, by race and Hispanic origin, August 2017
                                        • In their own words
                                        • Retailers Shopped

                                          • Budget shoppers prefer mainstream channels and Amazon
                                            • Figure 23: Retailers shopped, August 2017
                                          • Older shoppers stay true to routine and shop grocery
                                            • Figure 24: Select retailers shopped, by age, August 2017
                                          • Lower-income consumers seek value at mass merchandisers, while higher-income ones prefer Amazon
                                            • Figure 25: Retailers shopped, by household income, August 2017
                                          • Heavy budgeters shopping value-oriented retailers
                                            • Figure 26: Retailers shopped, by age, August 2017
                                          • Blacks and Hispanics seek value, while Asians aren’t deterred by membership fees
                                            • Figure 27: Retailers shopped, by race and Hispanic origin, August 2017
                                          • Budget shoppers describe their favorite stores
                                          • Budgeting Actions

                                            • Store brands, discounts, and low-priced items capture most budget shoppers’ interest
                                              • Figure 28: Budgeting actions, August 2017
                                            • Younger adults frequently shop discounted items and store brands
                                              • Figure 29: Budgeting actions, by age, August 2017
                                            • Coupon use spans generations
                                              • Figure 30: Budgeting actions, by generation, August 2017
                                            • Hispanics regularly practice more budgeting actions
                                              • Figure 31: Budgeting actions, by race and Hispanic origin, August 2017
                                          • Influence on Shopping

                                            • Many budgeters are willing to take a risk or shop around for the best prices
                                              • Figure 32: Influence on shopping, August 2017
                                            • Younger budget shoppers are less loyal to brands
                                              • Figure 33: Influence on shopping, by age, August 2017
                                            • Parents are willing to wait for the right prices
                                              • Figure 34: Influence on shopping, by select demographics, August 2017
                                            • Asian non-Hispanics are strategic with their shopping
                                              • Figure 35: Influences on shopping, by Asians, August 2017
                                          • Splurges

                                            • Most consumers willing to splurge on entertainment, experiences and clothes
                                              • Figure 36: Splurges, August 2017
                                            • Those with higher incomes prefer splurging on experiences
                                              • Figure 37: Splurges, by age and household income, August 2017
                                            • Young men splurge on fitness
                                              • Figure 38: Splurges, by select demographics, August 2017
                                            • Whites value splurging on experiences, while Blacks splurge on fashion
                                              • Figure 39: Splurges, by race and Hispanic origin, August 2017
                                          • Appendix – Data Sources and Abbreviations

                                            • Data sources
                                              • Consumer survey data
                                                • Consumer qualitative research
                                                  • Direct marketing creative
                                                    • Abbreviations
                                                    • Appendix – The Market

                                                        • Figure 40: Population by race and Hispanic origin, 2012-22
                                                        • Figure 41: Households, by type, 2016
                                                    • Appendix – The Consumer

                                                        • Figure 42: Retailers shopped, dollar stores – CHAID – Tree output, August 2017
                                                        • Figure 43: Retailers shopped, grocery stores – CHAID – Tree output, August 2017
                                                        • Figure 44: Retailers shopped, mass merchandisers – CHAID – Tree output, August 2017
                                                        • Figure 45: Retailers shopped, warehouse clubs – CHAID – Tree output, August 2017
                                                        • Figure 46: Retailers shopped – CHAID analysis, August 2017

                                                    Companies Covered

                                                    To learn more about the companies covered in this report please contact us.

                                                    The Budget Shopper - US - November 2017

                                                    US $3,995.00 (Excl.Tax)