New research published yesterday, commissioned by TWC, sponsored by Cirkle and TWC, and conducted by KAM, shows that shoppers are staying close to home and consumers are turning to their local convenience store alongside a growing recognition of their community value.
The Report, ‘Forging a New Future in Convenience Retailing’ is broken out into four chapters, the first of which is released today (Section One – The Current Landscape), and can be seen in more detail with the ability to register now for the full report which becomes available on 9th June 2020 https://twcgroup.net/convenience-retail-chapter-one/
‘Forging a New Future in Convenience Retailing’ reflects the views of over 560 consumers and shows that 75% (39.8 million*) of the UK adult population have visited a convenience store in the last six weeks, with 52% of consumers stating their local convenience store has become more important to them since lockdown measures were introduced on 23rd March 2020.
And retailers can expect the upturn to stick in months to come, with almost a third of responders confirming they will continue to use their local C-store more regularly on an ongoing basis, once the current government guidelines are relaxed. With risk of Covid-19 infection remaining top of consumers’ minds, over 77% of consumers says they feel ‘very safe’ or ‘somewhat safe’, when shopping in their local C-store.
WHAT PRICE OF CONVENIENCE…?
With talk in the media of retailers looking to profiteer from price increases, the study looks at consumer perceptions and finds that 51% of responders say they are not aware of any price increases.
However, 44% think prices have gone up although it is important to note that 47% of consumers stated that they would find an increase acceptable (to some degree), under the current market conditions.
Whilst it is generally believed that fewer products are on promotion than were three months ago, only 44% of shoppers have noticed this decrease, with 13% of consumers saying they have noticed more promotions in their local C-store since lockdown and 43% saying they have seen no difference.
According to retailer David Sands, who trades under the Nisa Local banner in Scotland, prices have risen in some instances and for good reason:
“We should be very clear that there is a difference between responding to current market conditions and a need for genuine price increases, against ‘predatory pricing’, which has been reported but actually only occurs in very few cases.
“Right now, the cost of deliveries is greater than it was on the 23rd March, plus there is no more ‘open food’ so the price of packaging has increased. Normal SKU’s such as price-marked-packs (PMPs) are no longer available, so retailers have had to switch to non-PMP packs. Whilst products are widely available to the consumer, there are still major supply issues which means the introduction of different lines. Take for example alcohol, where we are presently getting about 50% availability.
“Understandably, many retailers are probably ignoring promotions currently. Maybe one of the big learnings to come out of the current situation, will be that we are probably doing too many promotions and actually our customers are not that interested. If retailers spent their time on customer service rather than setting up promotions, I would question would they fare better?”
Commenting on the scope of the Report, TWC’s Tom Fender, says “Forging a New Future in Convenience Retailing’ gives a new perspective on the value of community stores and explores consumers’ perception of promotions and pricing which is a highly topical and current issue.
“Our aim is to provide valuable information and insight to help retailers and brands prepare for the ‘new normal’ as the UK comes out of lockdown. Shopping behaviours have changed overnight and in this Report we are exploring the short to medium term future of the UK convenience channel.”
Key Stats re Pricing from ‘Forging a New Future in Convenience Retailing’:
- 51% of consumers think prices have stayed the same. However, 44% think prices have gone up.
- 47% of consumers think it’s acceptable that prices have risen to some degree during current market conditions.
- 13% of consumers say they have noticed MORE promotions in convenience stores since lockdown
- Only 44% have noticed fewer
- 43% say they have noticed about the same number of promotions.
- Fewer promotions have led to:
- 36% saying it has made no difference to their shopping
- 34% saying it has switched to cheaper brands
Key General Stats from Forging a New Future in Convenience Retailing:
- 76% of the UK population have visited a convenience store in the last 6 weeks.
- 52% of consumers say convenience stores have become more important to them since lockdown measures were introduced. Only 11% say they have become less important.
- 59% of consumers say convenience stores have become more important to their communities since lockdown was introduced – consumers recognising the wider community benefits c-stores bring. Only 10% think they have become less important to communities.
- 45% have used c-stores more since lockdown was introduced. 35% have used them about the same. Only 20% less (and this might be due to general lockdown reasons).
- How safe do consumers feel when shopping in the local convenience store(s)?
- 27% say very safe
- 50% say somewhat safe
- Only 6% say ‘not safe’.
Note: This may be influenced by consumers’ general attitudes (and fears) towards shopping generally rather than specifically aimed at c-stores.
- We asked consumers which protection measures they think are a must have or a nice to have. This is what they say:
- Have a maximum number of people in stores. 70% must have. 21% nice to have.
- Flow systems around stores. 54% must have. 40% nice to have
- Protective masks/screens for staff. 63% must have. 29% nice to have.
- Communication regarding safety measures in store and out of store. 60% and 35% respectively
- That same communication as above but online – 36% (so lots of consumers are looking at c-stores’ websites?) and 40%
- Staff help/support – 47% and 45%
- Hand sanitiser/wash stations instore 50% and 43%
- Fresh produce but in wrappers – 40% and 42% (nice to have higher)
- Contactless payment – 44% and 44%
- Pay utility bills/top up online rather than instore – 32% and 43%
- 27% of consumers say they will use their c-store more after lockdown. 54% ‘the same’
*According to ONS figures the adult population in the UK at end of 2018 was estimated to be 52.4 million