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Nielsen: PH grocery spending down 13%

Filipinos are cutting back on groceries, skipping the hassles of cooking at home to eat in fast food restaurants or buy meals sold in convenience stores.

The latest global Nielsen Shopper Trends report found that 25% of Filipino consumers now eat out at fast food restaurants at least once a week, a contrast to only 14% a year ago.

Convenience stores selling prepared meals similar to the quick serve restaurant (QSR) format is also encouraging Filipinos to dine out rather than eat at home, though Nielsen did not provide hard figures.

This spike pulled back monthly grocery spending by 13% this year in comparison to 2012. From P5, 400 two years ago, locals now only spend an average of P4,700 monthly in 2014.

The study was conducted from February to March covering 1,783 males and females who are grocery decision makers aged 15-65 years old living in urban locations in the Philippines.

Lou-Ann Navalta, Nielsen’s Shopper Insights leader in the Philippines, said that both drivers revealed an increasing shopper demand for convenience, quick preparation and ready-to-eat meal options that and food brands should pay close attention to.

“These time-strapped Filipinos are spending more time away from home or in transit and are now more serious about convenient alternatives.”

“Food manufacturers in particular should understand that the need for “ready to eat” or “quick and easy” is not just a fad that will fade away; it is here to stay. Manufacturers and even retailers can ride on this trend by innovating to meet their needs or looking at tie-up opportunities with fast food restaurants and convenience stores as a way to stay relevant to these shoppers.”

What can retailers do?

Navalta also recommends retailers and stores to get much closer to their shoppers. The Nielsen report found that consumers now prefer to do all their purchases in stores closest to their homes – a boon to supermarkets, vegetable vendors and mini-market stalls set up closer to neighborhoodsbut at the expense of wet markets.

Proper assortment is critical so as not to turn off shoppers, she adds, saying that “opportunities to trigger unplanned purchases of items are endless.”

While 89% of Filipino shoppers claim that they plan what they will buy and 87% say that they follow a strict budget, in contrast, 87% admit that they end up buying more than what they had planned.

“Attractive promotions can encourage spontaneous buying as close to half or 49% of Filipino shoppers are always on the lookout for promotions.”

The study further reveals that most Filipinos want instant gratification type of promotions such as “buy 1, take 1” and price discounts.

“Promotions are important in keeping shopper engagement but should be strategically planned with a marketing objective in mind – to switch buyers, increase basket or drive purchase frequency –   otherwise, if abused, it could do more harm than good to the category,” recommends Navalta.

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