The Checkout 2.10 - 2009 Holiday Spending

the

inside the in-store experience

in focus: 2009 Holiday Shopping
This month we asked shoppers about their holiday shopping plans this season. Do they
expect to spend more, less, or the same compared to last year? Which retail channels

IN THIS ISSUE
will be most affected?

2009 Year in Review
• Recession or not, shoppers are slowly coming back.
• The time-versus-money dichotomy continues. What does that mean for your shoppers?
• Quick fill-in trips help ease pressure on household cash flow.
• Spenders are using more convenience-based shopping aids and in-store advertising.
• SKU rationalization: Is it working? Why some shoppers are walking away.
• Mobile shopping shows upward mobility.

In focus: Holiday Spending
• Recessionary pressures have made us a nation of shopping procrastinators.
• The game of chicken between shoppers looking for deals and retailers seeking sales intensifies.
• 2009 Holiday shoppers wanted instant gratification, free shipping, and free stuff.

issue 2.10 powered by The Integer Group ® and M/A/R/C ® Research

Coupons and free shipping high on shoppers’ wish lists

Holiday Specials & Shopping Tactics

? = “Have you taken advantage of any of the following holiday gift specials or sales?”
Newspaper/store ﬂyers and coupons 46 Special gift card savings (in-store) 16

Free shipping for online orders 45 Friends and family discounts 15

Buy one/get one half-price offers 37 Competitor price-matching offers 13

Instant rebates 31 Last-minute deals 13

An online offer that was e-mailed to you 28 Special gift card savings (online) 12

Additional savings from store
Special loyalty or appreciation rewards 28 7
credit card offer

An in-store offer that was e-mailed to you 26 Offers delivered by social networks 3

Black Friday deals 23 Refer-a-friend programs 2

21 Offers delivered by
Mail-in rebates 1
mobile/smart phone apps

Early-bird door-buster specials 17 Other
In-store 2

Daily specials on a store's Web site 16 Out-of-store None of the above 15

After a lackluster fourth-quarter holiday-shopping season, store coupons and free-shipping offers might
have been some of the best tools retailers used to salvage their 2009 sales figures. In the wake of the worst
economic crisis in decades, these two incentives top the list of gift specials or sales shoppers used most. In
fact, nearly half of those surveyed indicated they took advantage of store coupons (46%) or free online
shipping incentives (45%) when they shopped for gifts in 2009. Instant gratification reigns; shoppers were
most attracted to promotions that offered the most immediate forms of reward in terms of cash back, free
shipping, or free merchandise. The fewer hoops you make shoppers jump through, the more likely they are to
participate in your promotion.


Holiday shopping holdouts

Despite the abundance of early shopping events like Black Friday and Cyber Monday, most shoppers
reported waiting until December before doing the bulk of their holiday shopping. Shoppers indicated that they
intended to do most of their shopping, both online and in-store, in the two weeks prior to December 25 rather
than during the traditional retail spikes of Black Friday and Cyber Monday. Consistent with our findings on
late-season holiday shopping and retail promotions, many shoppers planned to wait until Green Monday (the
last day to take advantage of free-shipping offers).

The Holiday-Shopping Time Line

? = “When do you do most of your in-store and online shopping?”
(%)
60

50

40

30
in-store
online
20

10

0
1-Dec

2-Dec

3-Dec

4-Dec

5-Dec

6-Dec

7-Dec

8-Dec

9-Dec

10-Dec

11-Dec

12-Dec

13-Dec
y 14-Dec

15-Dec

16-Dec

17-Dec

18-Dec

19-Dec

20-Dec

21-Dec

22-Dec

23-Dec

24-Dec

25-Dec
24-Nov

25-Nov

26-Nov

27-Nov

28-Nov

29-Nov
y 30-Nov
ng

ay

da
da
vi

id

on
on
gi

Fr
ks

rM

nM
k
an

ac

be

ee
Th

Bl

Cy

2
Gr


Frugal buying declined throughout 2009

Shopping Behavior Compared to Three Months Ago

? = “In the past three months, how has your shopping behavior changed?”

(%) 1Q’09 61 37 2

2Q’09 54 44 3
Total
3Q’09 56 42 3

4Q’09 53 44 3

1Q’09 56 43 *
*3
Males 2Q’09 51 47 * 3

3Q’09 52 46 * 3

4Q’09 46 51 * 3

1Q’09 66 * 34 1

2Q’09 56 42 2
*
Females
3Q’09 60 38 3
*
4Q’09 59 37 4
*
Buying fewer/ Buying more/more
cheaper items expensive items
no change

Indicates significant difference from previous quarter at 95% confidence level
Indicates significant difference between males/females at 95% confidence level
*

While frugal buying dominated much of 2009’s shopping expenditures, the trend lessened as
the year continued. And while men were more inclined to open their wallets over the course of
the year, females too showed a similar pattern of gradually loosening the purse strings. The
question is whether or not this trend will continue through 2010.


2009 shopping trips price- and convenience-driven
In 2009, we saw shoppers take on a more utilitarian view of shopping – looking to get in, find what they need,
and get out without overspending and without having very much fun. Shoppers are realizing that they might have
to change their shopping behaviors to adjust for continuing recessionary conditions. Instead of getting
everything at once, they are increasingly using more quick fill-in trips to avoid larger grocery receipts and impact
on the family budget.

However, while both price and convenience have consistently dominated shoppers’ priorities the entire year,
both factors seem to be trending downward heading into 2010, possibly indicating that the period of
retrenchment for many shoppers could be easing, and a refocus on quality and experience might soon return.

Everyday Shopping Goals
“When thinking about your everyday shopping needs (food,
? = cleaning products, etc.), what would you say is the primary goal
you are trying to meet from each trip you take?”

29
Get everything in single trip, 29
saving the need for more trips 26
26

28
23
To spend as little as possible 26
24

8
Quick fill-in trips to replace 10
the things I use as I go 11
11

12
A comprehensive restocking 12
of the items I have used 12
14

8
To satisfy the needs of all my 11
family members 11
11 Q1

Q2

To find the freshest and
7
8
Q3
(%)
7
best quality items
7 Q4

6
Spend as little time in 7
Indicates significant
the store as possible 6 difference from previous quarter
5 at 95% confidence level

1
Be entertained and 2
have a fun time 2
2


Spenders utilize more experience- and
convenience-based shopping aids

? = “Thinking about your most recent shopping trip to help you shop?”
which of the following did you use in the store
for groceries,

Shopping Aids

44
Shopper discount card 45

43
Directional signage 36 *
40
Self-checkout 29
*
38
Coupon - manufacturer 49

33
Coupons - store 38
*
24
Circular - newspaper 37
*
22
Circular - in-store 27

21
In-store associate 10 *
Message on shelf
18
18
Spenders (People shopping more)

Savers (People shopping less)
(%)
Mobile phone
12 * Indicatesquarter at 95% confidence level
previous
significant difference from
6
*

0 10 20 30 40 50 60

Since the start of the year, shoppers appear to rely more on coupons, from both manufacturers and retailers, to help
them shop for groceries. While coupon use has been increasing, other forms of traditional shopping aids, such as
directional signage and in-store associates, have been steadily decreasing.

However, when viewing the shopping-aid preferences of Spenders (those who report shopping more) alongside
Savers (those shopping less), stark differences in recessionary coping strategies appear. The Savers segment shows
higher price sensitivity and corresponding shopping strategy using circulars and coupons, from both manufacturers
and retailers, significantly more than their Spender counterparts, who are using more convenience-based shopping
aids such as directional signage, in-store associates, self-checkout, and mobile phones.


Time is greater than money

Throughout 2009, shoppers notably chose price as their primary purchase consideration. However, with
bargain hunting at its lowest point of the year, customers appear willing to spend more money if it saves
them time. Both of these changes represent significant differences from shoppers’ sentiments earlier in the
year. In the short term, more shoppers were willing to chase deals, but as the recession lengthens, fewer are
willing to put in the extra time and effort.

Shopper Values
? = “Currently, where do you believe you fall between each of the following?”
Q1’09 41 39 15 6
(%) Q2’09 37 41 17 5 seek out
seek out lowest
possible price American-made
Q3’09 39 40 16 5

Q4’09 37 41 17 5

Q1’09 35 42 19 5

save money by Q2’09 31 45 19 5 spend more
shopping around but save time
Q3’09 30 43 21 5

Q4’09 29 44 22 5

Q1’09 35 41 19 6

Q2’09 32 44 19 6
save today, buy now
buy tomorrow on credit
Q3’09 33 42 18 6

Q4’09 33 42 19 6

Q1’09 22 44 26 8

stick with familiar Q2’09 22 47 25 6 switch brands or
brands or items try new brands
Q3’09 more often
22 47 25 6

Q4’09 22 47 25 6

Q1’09 14 34 37 15

Q2’09 14 36 38 13
buy individual-sized
items buy in bulk
Q3’09 13 37 37 13

Q4’09 14 35 39 12

Q3’09 15 46 32 7
buy private-label/ buy national/
store brands name brands
Q4’09 16 45 31 8

describes more
Indicates significant difference from previous month at 95% confidence level.


Spenders are walking away empty-handed
because they can’t find what they want

MAIN Reason for Walking Away – Spenders Vs. Savers
“Thinking about your retail shopping in general, in the past three months, have you gone
? = to a store to purchase a specific item but did not make a purchase? If so, what was the
MAIN reason why you walked away from the aisle without making a purchase?”

I couldn't find the exact item, product, 37
or size I was looking for 32

36
The price was more than I wanted to pay
48

I couldn't find the brand that 8
I was looking for 9

6
The aisle was crowded
4

3
The aisle was confusing/disorganized
3

The store was dirty
2

Savers (People shopping less) (%)
1

0 10 20 30 40 50 60

The biggest turnoffs for shoppers continue to be high prices and limited store selection, although shoppers do appear
to be less sensitive to price than they were earlier in the year. Spenders also seem less likely to list situational factors
like cleanliness and store organization and layout as primary deterrents from making a purchase. Not surprisingly,
Savers reported price as the main factor for not making a purchase, while Spenders couldn’t find the exact product
they were seeking.


Spenders are having fun again in the store and online

Consumers as a whole, seem to enjoy shopping less, with more shoppers indicating that they do not think that everyday
shopping is relaxing and fun. Spenders who want to be entertained and have fun go to the stores to explore and relax, but
along with that, they also end up buying things they didn’t plan to purchase. Online shoppers tend to be planners and
explorers who do preshopping research, prepare a shopping list, and shop primarily by price once a product is chosen.
Online shoppers also report that they are more likely to not make a purchase if they do not find the exact item for the price
they wanted to pay.
The adventurous Spenders are more likely to explore the store environment and view shopping as a relaxing and fun
activity – and thus more susceptible to make impulse purchases (43%). Their shopping preferences also continue to
reiterate their focus on convenience with more than a third (34%) saying they are willing to pay more to make their lives
easier and expressing deep affinity for online shopping.
Conversely, Savers are not having fun in the store and focus on discipline and price, being sure to use shopping lists and
coupons and refraining from browsing.

Feelings About Shopping – Spenders Vs. Savers

? = “Which of the following best describes how you feel about shopping?”
47
I like to explore the store
40

I often buy things that 43
I did not plan to buy 30

Shopping is how I relax
25

35
I always prepare a list
37

I will pay more if my 34
life is made easier 17

Online shopping is the 34
best use of technology 29

I seek out coupons 34
for everything 39

23
Shopping is fun
11

Brand names are extremely
important to me 11
23

Savers (People shopping less) (%)
0 10 20 30 40 50


Coupon usage climbs

Coupon usage grows, and grows, and grows. Recessionary pressures have reshaped the shopper mind-set and have
significantly altered the way they prioritize their time, shopping trips, retailers, and more importantly - their money.
As seen in prior sections of this report, coupons and circulars are beginning to play a much larger role in shoppers’
money-saving arsenal. Savers are taking it one step further, and have reduced the amount of time and money they
spend on the Internet. Spenders, who are spending more and more often, are increasingly using the Internet to
compare prices and make purchases, both via a computer and their mobile phones.

New Shopping Behaviors
“Which of the following are new behaviors you have started
?= in the past three months when you’re shopping?”

45
Have started/am using more store
43
or manufacturer coupons
47

42
Have started/am using store circulars
41
more often to find deals
42

42
Reading packaging or signage
38
more to find better deals
38

31
Have started/am using
30
Internet coupons more often
31

32
Have started/am using Internet
30
more to compare prices
27

18
Have started/am using store Web sites
15
more often to make purchases
14

9 Q2
Driving farther to save
9
money on purchases
9 Q3
(%)
Q4
4
Using cell phone to help me shop 4
4 Indicates significant
difference from previous quarter
at 95% confidence level
21
None of these 20
18


One-stop shops are tops
When selecting stores, consumers prefer to shop at retailers that allow them to get all of their shopping done
in one place. In addition to selection, everyday low pricing and the price/quality mix rounded out the top
three most important criteria for shoppers.

Spenders are concerned with retailers’ breadth and quality of products and feel that the store environment
is a direct reflection of who they are as people. Unsurprisingly, Savers choose their retailer primarily by price
considerations, buying less and seeking the lowest prices.

Store-Selection Criteria
“Thinking again about your everyday shopping needs, what
?= are the top three important criteria for your choice of store?”

44
Carries everything I need
39

38
Close by
37

26
Offers lowest prices
44

21
Accepts my bank or credit cards
12

17
Is a store brand I trust
13

14
Carry high-quality brands
6

11
Fantastic customer service
8

Has a shopping environment
that reflects who I am 3
10

Savers (People shopping less)
(%)
0 10 20 30 40 50


Retailers and value perceptions go hand-in-hand

When asked which brands best communicate value to them, most consumers think of major retailers like Walmart and
Target. Walmart continues to be the most popular value brand, with 14% of shoppers listing the retailer. Retailers are
increasingly expected to be seen as value brands. But others like Apple, Sony, and Kellogg's — which are generally not
the lowest price products — are communicating value through the quality and familiarity of their brands.

Brands That Communicate Value
? = “Still thinking about value, please list all brands that communicate value to you.”

18
AUG

10
14
(%) NOV
10 Indicates significant
difference from previous quarter
at 95% confidence level
9
8

4
6

4
6

4
6

5
5

5
5
cars/ food/
clothing/ cosmetics/ accessories/ electronics beverage/ stores
5 shoes toiletries parts brands
5
Johnson & Kraft (2)
Levi’s Johnson(2) Toyota Sony(1) Walmart (1)
5 (2) (2)

5
Nike Colgate Honda Apple(3) Kellogg’s Target (2)
(1) (1) (1)
4 (na)

5
Lee Crest Ford(3) Dell (2) Campbell’s Costco(na)
(na) (na) (na)
4
5
Italics indicate previous month’s ranking.


C-Store fear factors – freshness, quality, selection
In general, most shoppers place heightened importance on issues regarding food quality and product variety/selection
when choosing convenience stores. Along gender lines, women are more concerned about safety and quality food
options, whereas men are more likely to say they don’t care as long as the store is convenient and trustworthy.
Furthermore, male shoppers will avoid a c-store because of poor staff quality, limited selection, or long lines. Younger
shoppers (18–24 years of age) differentiate convenience stores by the exterior appearance, sense of personal security,
and selection of healthy food options. Because a convenience store is supposed to be, by definition, convenient, this same
younger shopper will avoid a c-store because of a confusing layout or difficulty getting to the store.

Above other factors, convenience-store shoppers primarily look at product selection and food quality when selecting
between different retailers and store locations. Higher income ($75K+) shoppers are more sensitive to parking and
product selection than lower-income groups.

Female shoppers are increasingly becoming a more important segment for the c-store channel and are attracted when
stores offer a sense of security; clean store environment; fresh, high-quality food; and special promotions.

Reasons to Seek-out or Avoid a Specific C-Store Location
“Please select the top three factors that would cause you to avoid visiting a specific convenience store location?”
?= “Please select the top three factors that would cause you to seek out a specific convenience store location?”
-54
Fresh or quality food selection 39

-55
Product selection 41

-6
None of these, don't care 18

-34
Parking 22

-35
Store appearance 25

-28
Safety 19

-29
Customer service 28

-20
Other 10

Advertisements/special promotions 33

Quality store chain 29

-27
Difficulty getting to store

Reasons to Avoid DEC (%) Reasons to Seek Out


The Integer Group® (www.integer.com) is M/A/R/C® Research is a brand development firm
one of America’s largest promotional and retail dedicated to helping clients create, evaluate, and
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solutions for clients in categories that include
Our core competency is measuring attitudes and
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Join Integer® in a conversation on shopping
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www.shopperculture.com brands. Our proven, marketing-issue focused solutions
contact: The Integer Group support clients’ brand building efforts.
Craig Elston
Sr. VP, Insight & Strategy
celston@integer.com
www.MARCresearch.com/thecheckout
7245 West Alaska Drive
Lakewood, CO 80226 contact: M/A/R/C Research
tel +1.303.393.3474 Randy Wahl
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Randy.Wahl@MARCresearch.com

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tel +1.972.983.0436

The Checkout is based on a nationally representative survey of 1,200
U.S. adults conducted monthly by M/A/R/C Research. Please contact
us to learn more about the data we collect or additional analysis.

©2010 by The Integer Group ® and M/A/R/C ® Research. All rights reserved.
The data contained in this report may be reproduced in any form as long as the data
is cited from The Integer Group and M/A/R/C Research. www.ShopperCulture.com.


The Checkout 2.10 - 2009 Holiday Spending

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