European families’ shopping habits are changing fast as the economic realities that evolved over the past decade are having a deep impact on society. It seems that in most EU countries people shopping for day-to-day consumption needs are still obsessed with finding the cheapest deal to save hard-earned cash.
The renowned market research company Nielsen has published a very interesting study of the shopping habits of British families. While I know of no publicly available study on Maltese consumers spending habits, I believe that our families’ shopping culture is not all that different from that of other European countries. So the Nielsen study may reveal how our own society is changing in the way it spends its money.
Mike Watkins, Nielsen’s UK head of retailer and business insight, states: “Half of consumers are changing their spending habits to save money, including chasing price cuts around different stores.”
The supermarket industry is definitely aware of this evolving consumer mindset and is making it easier for hard-pressed consumers to shop in their stores for longer hours every day of the week.
The protracted recession that started in 2007 has brought about the biggest change in supermarket habits since the 1950s as many middle class families are seeing real cuts in their income that are forcing them to be more frugal in their spending habits. Frugality has indeed become a middle class value after being frowned upon for decades.
Discount chains like Aldi and Lidl were the first to understand this trend, but the big four of the British supermarket industry – Tesco, Asda, Sainsbury’s and Morrison – are beginning to understand that this major change in spending habits is affecting their future prospects for growth.
One facet of this cultural change is that consumers today are increasingly inclined to shop more often at more places while buying less. Gone are the days when most consumers preferred to cater for all their shopping needs in a trip to a mega supermarket once or twice a month. Consumers’ loyalty to glitzy supermarket brands is dissolving as low prices have a deeper impact on those who are more conscious of the value of their hard-earned cash.
Consumers today are increasingly inclined to shop more often at more places while buying less
Another interesting reality that comes out of the Nielsen report is that UK families are spending less on food bought in traditional supermarkets and increasing their spending in budget stores. At the same time low-cost supermarkets are offering a bigger choice for consumers by introducing a range of better quality products that are sold at a small premium even if they are still cheaper than equivalent products sold in traditional supermarkets.
While the local supermarket industry is evolving with similar trends to that of the UK, there are some inevitable local differences. The effect of the global recession on Malta has been arguably less severe than it was in some other EU countries. So consumers may have been less inclined to move in droves to low-cost supermarkets.
For most local consumers, food prices will always be a top priority when deciding where to shop. But other considerations are important. Despite the small size of the island, the location of a supermarket is an important motivating factor for families who want to complete their weekly shopping spree in the least stressful way possible. So availability of parking facilities near supermarkets as well as travelling time to get there are important considerations for local consumers as the island becomes increasingly gridlocked with heavy traffic.
It will soon become inevitable that, like in most other countries, the industry will suffer from overcapacity. More supermarkets are planning to open for business in different locations giving consumers a wider range of choice. Price wars are still not so evident but competing aggressive marketing campaigns are.
Every household in Malta has to deal with loads of junk mail in their letter boxes every week as major supermarkets try to lure customers with marketing literature offering special offers and discounts based on brand loyalty. Longer daily opening hours as well as Sunday trading are becoming more common as the battle to attract customers hots up.
I believe that the next phase of this competition between local supermarkets will be the enhancement of online sales. While some consumers find physical shopping therapeutic, most others would prefer to make their shopping for day-to-day staple consumables online.
So watch out for the first local supermarket that offers exciting online shopping facilities.
johncassarwhite@yahoo.com