Supermarkets Get New Competition from Dollar Stores

Guest post from our friends at Spots 'n Dots

 

Running a supermarket has always been a low-margin business. Chains made money through volume more than pricing. But now the dollar store is becoming a real threat

to both the traffic and the margin, says a new survey from Perception Research Services International (PRS).

Make no mistake, supermarkets still sell the majority of groceries in the U.S. The PRS  survey finds that 91% of shoppers bought groceries in a supermarket in the last three months--about the same as last year’s 92% in a similar survey. And mass merchandisers like Walmart and Target, are still the supermarkets’ biggest competitors, with 73% of survey participants shopping for groceries there in the last three months (down from 76% in 2011).

But the number of persons who bought groceries at a dollar store has risen to 35% this year, up from the already surprising 32% in 2011.Levels of grocery shopping at drug stores (46% compared to last year’s 47%) and convenience stores (23%/24%) have held relatively steady since last year.

While grocery stores still are preferred for perishables and food stuffs, dollar stores are favored for things like cleaning supplies and personal care items. According to the PRS survey, during 2012, more shoppers utilized sales/coupons (83%) and quantity/size

control (70%) to save money than in 2011. And in keeping with what we have been reporting, this year significantly more shoppers claimed to have switched brands to curb

costs (61% vs. 49%). 

All those cost-cutting, price-conscious measures have meant that supermarkets have had to cut their own prices to the bone over the last year to keep up. And many, like Kroger, are emphasizing customer service, an advantage they have over dollar stores. "Our latest findings on grocery shopping indicate how very discerning today's shoppers are – about their venue preferences as well as brand choices," said Jonathan Asher, EVP at PRS.

"Retailers must understand their competitive strengths and capitalize on them, while also making the necessary adjustments to their offerings to seize opportunities for a larger slice of the pie as shoppers are more open to new shopping possibilities than they have

been since the 1950's with the advent of large, supermarket chains."

Expand Your Holiday Traditions

As the holidays approach each year, it is easy to become overwhelmed with the to-do list. From planning your feast, to buying gifts, decorating and running errands, we can sometimes forget there are folks out there for whom the holidays are just another day.

There are many organizations that collect gifts for children to brighten their holidays, and the response from donors is typically pretty good. No one wants to see a child have no gift at all for Christmas or Hanukkah. Unfortunately, there are adults out there who expect and often receive nothing to mark the holiday as special or to remind them that someone cares. In honor of this group, here are a few ideas you might consider adding to your holiday traditions:

• Donate small gift items to a senior center or program that coordinates in-home meal delivery for seniors. Things like socks, warm slippers, lotions or toiletries, lap blankets, scarves, or large print books or crossword puzzles.
• Check with your local homeless shelter to see what is on their needs list. They often need travel size toothpaste, disposable razors, tooth brushes, deodorant, new underwear and socks, or other personal care items.
• Plan a visit to a nursing home. There are many residents in long-term care facilities that don’t have family or other visitors. They would love a visit. If you are a Scouting leader, take your troop to sing carols and brighten many residents’ day.
• If you live near a Veterans Administration hospital, check with them to see if you can schedule a visit to a veteran who might be alone during the holidays. You can also ask about donating items like books, music, DVDs or personal care items.
• If you live near a military base, ask about inviting a solider or sailor to your home. Some of the facilities coordinate a program that matches single service members with local families willing to host them for a holiday meal. Don’t wait too late, though. In many cases, sign-up to host for Christmas dinner ends in early December.

There are many individuals in need out there, most of whom will not ever ask for help. If you are willing and able to meet the need, they will definitely appreciate your making their holiday a bit more special. If you have other ideas for giving, please let us know--we'd love to hear about them.

My sweet (diabetic) life...

November is American Diabetes Month. I’m not one to share my story, but felt it was time. I was diagnosed with type 1 diabetes right out of college. Early on I didn't deal with things very well, like learning to give myself a shot. It was a hard blow to learn I could never eat chocolate again (I’m a serious chocoholic) or have more than one drink (I was young!). So I ran away from taking care of myself and tried to live my life (with chocolate). I did the minimum to get by, or at least I thought I was getting by until I ended up in the ER when my blood sugar went so high I couldn’t hold down water. I was in the hospital for several days I don’t remember. That was a bit of a wake up call, but I’m stubborn and it took me a little longer to really get serious in dealing with my diabetes.

Luckily there have been many advances in how they treat diabetes, like the fact that you can eat chocolate as long as you compensate for it!! I have gotten better at my management of diabetes and I live a very full life and find there isn’t much I cannot do! A few things that have really helped my management are getting the insulin pump (now I have a cool version without all the tubes), eating healthier, and exercising. I won’t say I’m always good every single day, that is a standard that is really hard for me to meet, but I find these small things really make a big difference.

I look for alternatives to having a lot of carbs in my meals and have a wonderful, healthy recipe for smashed cauliflower to share. To me it is like having a big heaping of mashed potatoes without the guilt and carbs!

Boil water, place 1 head of cauliflower florets in water and cook until a fork goes in easily. Meanwhile, add 1 little container of plain Greek yogurt into a mixing bowl, along with a 1/4c blue cheese crumbles (spurge for the good stuff, it has more flavor). Then add the cauliflower and smash/mix away. I use a hand held blender mixer, but a regular mixer works. I don’t mind if there are chunks, but mix to the consistency you like and salt and pepper to taste. Enjoy and don’t feel guilty about seconds!!

If you’ve been living with diabetes, please send me your thoughts or things that work for you!

SNF Now the Most Expensive Spot

Guest Post from Spots and Dots

The reign of American Idol as the program with the highest spot cost is over. The new king is Sunday Night Football, according to a survey in Advertising Age. And while last year only $10,000 separated Idol from SNF, this year it’s not even close. AdAge says a 30-second spot in Sunday Night Football now costs $545,142 compared to the $340,825 for a similar ad in American Idol’s Wednesday edition.

The rest of the top ten in 30-second spot prices this year, as reported by Advertising Age, are: Modern Family ($330,908); New Girl ($320,940); American Idol Thursday ($296,062); The Simpsons ($286,131); Family Guy ($276,690); The Big Bang Theory ($275,573); 2 Broke Girls ($269,235); and Two and a Half Men ($274,261).

Holiday Shopping Predictions

Here's some great information from our friends at Spots n' Dots, the Daily News of TV Sales.

Each year Booz & Co., a business consulting firm, surveys consumers, retail store staff and retail executives to get an idea of what the retail industry can expect in the holiday season. This year, Booz predicts that holiday spending will be up just slightly over last year. Consumers are still very cautious about spending; 52% say affordability will be a big consideration in their purchase decisions. But 73% expect to find great deals this holiday, up from 62% in 2011.

Just over 50% say that just surviving the economic downturn is a good enough reason to celebrate this year. Fifty-three percent intend to purchase a luxury item--typically one that the whole family can enjoy. Last year, only 41% were planning a luxury purchase.

Gift cards will once again be very popular; 80 million shoppers plan to purchase them, up 4% from 2011. As we have been reporting for quite a while, shoppers are getting more and more internet savvy. For instance, 45% of consumers plan to give a downloadable gift this

year--like an eBook, music or a movie. But that comfort with the web will pose a very real threat to brick and mortar stores, says Booz. Forty percent of shoppers say that their buying strategy will involve “showrooming” (or “showcasing” in Booz’ parlance), browsing in stores for items that they subsequently purchase online.

"The biggest challenge this season for brick-and-mortar retailers is determining how to drive more than their fair share of 'showcasing volume' to their websites rather than Amazon.com or another competitor," said Thom Blischok, chief retail strategist for Booz & Co. "While technology enhancements and economic uncertainty will both impact this holiday season, there is a dose of optimism compared to 2011, as people shop with a value-seeking mindset."

Booz says in order to overcome this showcasing, retailers have to have robust websites of their own and apps that can direct shoppers to their own internet sites, rather than others like Amazon.com. They need to use QR code driven promotions, give free shipping for items bought in their online stores and make sure that salespersons are as familiar with the offerings at the retailers’ websites as they are with what is one the floor. "Retailers will need to adjust their holiday sales strategies to embrace an evolving consumer mindset, favoring a more seamless shopping experience through smartphones and in-store opportunities," said Nicholas Hodson, of Booz & Co.'s Consumer & Retail practice.

Cause Marketing

Has your company ever done any cause marketing? If you aren’t familiar with the term, cause marketing generally refers to a partnership between a business and a charity they wish to support. The idea is to encourage consumers to support your product(s) with the understanding that some percentage of the sale will be donated to the charity. It basically works like this:

  

• The business identifies a charity to support and agrees in writing to collect a certain minimum dollar amount to be donated at the end of a specific time frame (usually a year). 
•  The charity provides their logo and any other materials the business will need to begin their cause marketing campaign. 
•  The business communicates the initiative to its employees, customers, vendors and fans. For a consumer goods provider, they may change their product packaging, update their website, or advertise the cause online. 
•  Sales or other related metrics are tracked so the correct donation may be made. The metrics are directly related to how the company chooses to set up their campaign (examples: buy product A and $.25 from each item sold will go to the charity; “Like” us on Facebook and $1 for each Like will go to the charity). 
•  At the end of the agreed upon timeframe, the donation is made to the charity and press releases go out all around!

In years past, many businesses would either send a check to the charity or would sponsor an event where they would receive name recognition for their sponsorship. In today’s economy, many small to mid-sized businesses are hesitant to spend large sums on sponsorships or simply don’t have the cash to do so. While there are some rules that must be followed to utilize cause marketing, it is an option to allow your business to contribute when you might not otherwise believe you cannot do so. To learn more about cause marketing, contact us at cs@vitalinkweb.com.