Valentine’s day is just around the corner and two things are on every grocer’s mind: what to do for your significant other and how to make the most money. Sorry folks, this article only concerns the latter. This romantic holiday has been going on for centuries but this year promises to be the biggest. Let us profile some trends and predictions relevant to your questions as a grocer.
Total spending, according to the National Retail Federation, will reach $18.9B, a survey-high, a total of $142.31 per person (an increase of over 6%). People will mostly be buying (and spending) on: 91% on significant others ($87.94), 58.7% other family members ($26.26) and (to our delight), people will spend and average of $6.30 on classmates and teachers. As expected, romantic gifts are the biggest share of the pie but one shouldn’t neglect other costumers’ needs; costumers are looking to save time and money on gifts for friends and might be more likely to choose a grocery store (as opposed to, say, jewelry where grocers rarely dabble). Now that we know who is it being spent on, let’s see how the money is being spent(1):
As you can see, most of the money is being spent on jewelry, but most of the gifts are candy and flowers. The opportunity lies not in capturing the jewelry spending, but using your position as a grocer to attract all those people looking for minor gifts. Once they are in the store, you know what to do. Polls conducted in between 2007 and 2013 show the behavior of costumers during Valentine’s. Going out seems to have taken the highest hit during the recession; people going out on dates have not recovered since the recession. Most other activities have remained somewhat stable. See how they’ve changed across time here(2):
Now that we know what people are buying, we can understand how large grocer’s share of the pie is. Of all those surveyed, 89% had purchased a V-day gift in the same store where they had purchased groceries and 72% intended on doing it this year. Over half (57%) of these shoppers say they prefer gifts grouped in a single location, and 45% of them want in-store signs to direct them to offers. Only 37% stressed the importance of having information highlighted in circulars and flyers(3). The motion is towards convenience and easy: people looking for deals will most likely use other media.
We have collected interesting merchandising and display ideas in the Sutti Pinterest page. We hope they help!
-The Sutti Team
Super Bowl Sunday is around the corner. Fans are itching and media is buzzing; grocers rally for a great weekend in sales. This year’s Super Bowl is expected to be the biggest one yet, a victory over the recession: Wall Street gains are finally percolating into consumer spending and grocers are poised to catch a big slice of the recovery pie. As millennials’ purchasing power matures, this year’s Super Bowl is not only bigger but also more connected!
TRIVIA: 1.25 Billion (yes, with a “B”) chicken wings will be eaten during this year’s Super Bowl, according to the Natl. Chicken Council! (4)
This year, 184,000,000 people will watch the game; that is 75.8% of the population of the United States. Of those watching, 79.3% will purchase food and beverages the highest of all categories (the second-highest category, team apparel or accessories, is just over 10%). The planned spending per person will reaches $77.8 (up 14% from last year) and the total bill will come out to $14.3 billion dollars. (1)
It is clear that it is bigger, but how is this Super Bowl different than the previous one? The National Retail Foundation has some interesting insights into people’s Super Bowl behavior (or, should we say, rituals?). Most of those surveyed (34%) agree that the game is the most important part of the day; interest in the half-time show, commercials and getting together with friends peaks in the ages of 18-34 (i.e. millenials). The value millenials put in the social aspect of the Super Bowl can be seen when asked if they intended to either host or attend a Super Bowl party where the most eager to partake were, again, the 18-34 age group. Planned spending, as well, increases and peaks at the 24-34 year category. Planned spending on food and drinks will reach historic highs this year! (2).
Grocers can expect, from what these numbers show, healthy sales this Super Bowl weekend. But, beyond that, grocers have an immense opportunity to establish their brand in young costumer’s minds and partake in one of the most social weekends of the year. Great service can get you costumers and and your name out there. While most costumers will be using their mobile devices to compare gear prices, the amount sold during the weekend is on the rise as well. Experts expect that 41% of all people watching will use social media during the game, of which over 55% will go through Facebook(3). Expect your costumers to be partaking on the conversation sharing pictures (some of food) and banter. Don’t get caught in the trash talking, but make sure to stay relevant: hashtags might be crucial for visibility.
This Super Bowl is expected to be the biggest one yet and, as millennials mature into working-age and their purchasing power increases, grocers’ strategies must change with them. This year’s game shows clearly that the bad times are over and, regardless of who wins the Bowl, grocers who step-up their social-media game will come out on top and establish their brand with a new generation of costumers.
Organised Retail Theft (ORT) is a $37 Billion problem that affects 96% of retailers(1). Unlike petty thieves, these gangs they are highly organised, entrepreneurial, and technologically savvy. ORT also differs in that it aims to convert the illegally obtained goods into financial gain, not personal use(2). These criminal activities include theft, gift card fraud, receipt fraud, ticket switching and cargo theft(1). Yearly, American retailers spend $27 billion dollars on retail theft prevention(4). Where do grocers fit in the picture and what can they do?
Compared to most other types of retailers, Grocers’ losses due to theft are near the median. But, considering the small margins prevalent in the grocery retail industry, these numbers gain significance. The size of stores, the complexity in the supply chain and fast employee turnover rate are factors that increase theft and burden grocers’ already small margins. Grocery merchandising is also more vulnerable to theft, specially when compared electronics and jewellery (where everything is locked and tucked away). Are safety and sales pitted against each other? Profit depends on finding the middle point.
Three main factors are identified as contributing to ORT: location, types of goods sold, retailer’s controls and policies, and store layout and design.
- Location: stores in malls or near highways are more vulnerable to ORT as they are easier and more efficient target for traveling gangs.
- Type of good sold: CRAVED goods (Concealable, Removable, Enjoyable and Disposable)
- Retailer’s controls and policies: a liberal return policy, ratio of part-time to full-time associates, costumer service and sales floor presence, and staffing at entrances and exits.
- Store layout and design: store layouts can increase visibility and eliminate blind spots, thus maximising the deterrence that employees, electronic systems and other costumers have(2).
These principles were supported by a study in which known retail theft offenders were interviewed about the physical cues that influence their decision to steal. The table summarises the most salient findings(5).
Together with a preventive strategy, retailers should be prepared for when theft does happen or the offender is caught. At the end, you will find a series of links to interview formats and other resources for retailers to take action and curb ORT.
Together with grocers’ expertise, these insights can inform a strategy to fight ORT. It is important to keep tight inventory control, as this will show the effectivity of measures. A sound strategy will deter potential criminals and reduce shrinkage, thus allowing for bottom-line growth
-The Sutti Team
RESOURCES FOR RETAILERS: