Shopping in the New Normal
At our webinar last week, we investigated what the effects of COVID means for brands and retailers going in the future.
Latest research backs up what PromoVeritas termed ‘The New Normal’ – online retailer growth, supermarkets slowing, consumer budgets depleting and price wars looming. Our Managing Director, Shelley Davies, takes a closer look at recent developments;
Has the supermarket boom reached its peak?
“New data from Kantar* indicates that the UK Government’s Eat Out to Help Out scheme and the nation’s return to pre-COVID office and social life routines has slowed supermarket sales this past month. In the four weeks leading up to 6th September, shoppers spent £155 million less than they had in July meaning that groceries growth was at its lowest level since April 2020.
And as the nation’s biggest ever promotion encouraged us to ‘Eat Out’ more it meant that we also drank out more too, resulting in a dip in alcohol sales, with beer down 10% and wine 5%. However, on a positive note our return to socialising means an end to the ‘lockdown look’ and sales of hair products, deodorant and hair removal treatments have boomed.
Kantar had reported in July that whilst the number of shoppers visiting supermarkets has fallen, the average spent per trip was £20.05 – 35% more than the same period in 2019. The lesson here is that people prefer to make less trips and spend more in one visit, so make your product stand out with a prize promotion that packs a punch.
Promotions that add value
It is also clear that as the end of the Government’s Furlough scheme approaches and the nation’s budgets get tighter retailers are responding with a focus on price cutting, improving their loyalty schemes, and ditching multibuy deals.
Fraser McKevitt, Kantar’s Head of Retail and Consumer Insight said “We expect loyalty schemes to become increasingly important in the months ahead. 26 million British shoppers hold at least one supermarket loyalty card, with the average person carrying three in their wallet”. It is no coincidence that Lidl launched its own loyalty scheme last month and that Tesco’s Clubcard just announced a raft of price cuts to their loyalty scheme members on 200 key frozen items as well as extending its Aldi price match campaign to all customers. Blending prize promotions in with loyalty schemes is one way we have seen retailers gain sales and reignite customer interest as the economic climate grows more challenging and stores need to find new ways to deliver value.
Moving online more?
Nielsen also produced data for the same four weeks at the end of August and start of September which confirmed that supermarket growth has slowed, similarly to Kantar. They also showed that online growth was still increasing and that online FMCG sales were up by 102%. Their data also showed that in the last quarter supermarkets had 10% more online shopping visits than in the previous period which they took to mean that the channel is growing – however it could just be down to an increase in delivery slots which were rare back at the beginning of lockdown?
So, what does this all mean? To PromoVeritas we have seen an increase in bigger and bolder prize promotions which reflect the kind of prizes the public really want to win. Cash obviously is the most popular but also little things that help during a pandemic – from winning your shopping cart, to home cinema items, to food hampers, lifting customers out of the gloom of the pandemic is one way brands and retailers can make a difference. One final bit of research for the same period by Nielsen’s showed that, despite Kantar’s figures, champagne sales are up 24% – which means that good news is on the increase! Let us do the same for your customers with a well-run prize promotion”.
If you missed our New Normal webinar contact firstname.lastname@example.org to find out how to view it or to discuss how we can help you with planning your next promotion. You can also register here for our next webinar all about Running Alcohol Promotions on 7th October where we will be joined by the Portman Group to explore the rules, best practices and top tips for running effective drinks campaigns.
*Based on Kantar Worldpanel Plus daily data – an index of shopping trips across every physical channel and major retail brand in both food and non-food channels.