CONVENIENCE is the top priority for Filipino shoppers when it comes to choosing retailers, according to the 2019 SmartShopper study of Kantar, a data, insights and consulting company.
The Kantar SmartShopper Study is an annual report that combines shoppers’ actual behavior with their perception of retailers across a number of attributes. The study is conducted by the Worldpanel Division of Kantar, leveraging a survey of 2,000 urban households nationwide from July 2018 to June 2019.
Convenience is king
Kantar data showed that convenience has consistently been the most important factor Filipino shoppers consider when choosing where to purchase fast moving consumer goods (FMCG) since 2015. However, the shoppers’ definition of convenience continues to evolve.
In the past, convenience meant accessible location. But today, the number one factor that makes shoppers consider a retailer convenient is the range of services it offers to make shopping easier. This includes payment assistance, specialty counters, car parking assistance, baggers assistance, price checker and kiddie carts. The second most important attribute is the accessibility of the retailer’s location.
“Shopping is expected to be more pleasurable and easier as lifestyles become busier and fast-paced. Retailers thus need to be sensitive and more creative in finding ways to cater to these customer expectations. When this happens, customers not only spend more time in the store but their frequency of visiting potentially rises as they become more loyal to these stores,” said Des Deocareza-Lozano, Kantar, Worldpanel division director.
Emerging channels on the rise
With the increase of FMCG product sales also comes the rise of emerging channels which include hyper/supermarkets, department stores, convenience stores, personal care stores, direct selling, drug stores, gifting and groceries.
These emerging channels now account for 50 percent of the FMCG market. It grew by 16 percent percent, double the growth of traditional trade channels, which as a result lost share from 45 percent to 43 percent.
As modern trade channels aggressively expand, the top modern trade retailers continue to reap the rewards.
According to the Kantar study, the top five modern trade retailers, namely Puregold, SM, Gaisano, Mercury Drug and Robinsons, collectively account for 15 percent of total FMCG sales.
These five retailers enjoyed significant growth in the past year, with Puregold and Mercury Drug both growing the most in value shares. Puregold has grown its value share to 4.6 percent from 4.1 percent in the previous year while Mercury Drug improves from 2.4 percent to 2.6 percent.
The study also suggests some specific steps retailers can take to solidify their foothold in the modern trade space.
For example, by providing a more pleasant shopping atmosphere, Kantar’s SmartShopper 2019 study projects that one of the top Philippine retailers can further boost sales growth by as much as five percent.
“We need to constantly think about what drives shoppers to buy in specific channels as they become more complex and demanding. Convenience as we know it today may be redefined and can become a ‘given’ for shoppers. Both manufacturers and retailers then need to bear this in mind as they map out their growth plans this year,” Deocareza-Lozano added. (PR)