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ACNielsen Study: Grocery Stores Continuing to Lose Share of Shopping Trips

CHICAGO - Consumers are shopping less frequently in traditional grocery stores, while they are increasing their trips to supercenters like Wal-Mart and dollar stores, according to the latest "channel blurring" study from ACNielsen U.S., an operating unit of ACNielsen, a VNU company.

According to the ACNielsen study, supercenters and dollar stores are showing gains both in the percentage of households who shop in those channels and in the number of trips consumers take to them each year. The findings, based on an analysis of ACNielsen Homescan consumer panel data, were released here on the eve of the annual Food Marketing Institute convention.

According to Todd Hale, senior vice president, consumer insights, ACNielsen U.S., "More than ever, grocery retailers have to create a unique reason for shoppers to choose them. The consumer has to associate the name on the store with something very positive and very different from the competition, whether it's the freshest produce, the best selection of seafood, or the most interesting and convenient-to-purchase prepared meals. Retailers could be doing much more with their frequent shopper databases to segment their customers and to develop strategies around each segment to grow their overall business."

The study found that while all U.S. households still shop in traditional grocery stores, the annual number of trips households make to such stores is continuing to decline. At the same time, both supercenters and dollar stores have shown strong gains in household penetration and smaller gains in annual trips.

Among supercenters, Wal-Mart has been especially successful at converting grocery-store customers to Wal-Mart customers. An analysis of ACNielsen Wal-Mart Channel Service data shows much of the retailer's supercenter sales growth coming from traditional grocery-store shoppers. While 7 percent of 2001 Wal-Mart Supercenter sales growth came from new shoppers and 21 percent came from existing shoppers who increased their Wal-Mart Supercenter spending, the majority -- 72 percent -- came from a direct shift of dollars that had previously gone to other channels.

Hale said it is important to note that the degree to which Wal-Mart is gaining at the expense of the grocery channel is actually somewhat less than would be expected. "When you exclude the supercenter channel, grocery stores generated 40 percent of all-outlet revenue in 2001. Therefore, of the channel-shift revenue growth experienced by supercenters, we would expect 40 percent to come from the grocery channel. The fact that it was 32 percent means grocers are having at least some measure of success defending their turf."
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