retail news in context, analysis with attitude

A new Retail Preference Index study done by dunnhumby, endeavoring to identify consumers’ favorite supermarkets, concludes that Trader Joe's, Costco and Amazon are shoppers’ preferred stores.

Rounding out the top 10, in order, are HEB, Walmart, Wegmans, Aldi, Sam’s Club, Sprouts, and Whole Foods.

According to dunnhumby, “The RPI study surveyed 11,000 U.S. households and analyzed consumer emotional sentiment for 59 grocery retailers and then combined the survey data with the retailers' financial performance which then created each retailer's preference index.”

in its analysis of the numbers, dunnhumby concluded that the top rated companies shared four characteristics -they were price-focused, quality focused, value-focused and supported by digital execution.

The study goes on: “The second best performing quartile of retailers include some of the higher performing, older grocery banners including Meijer, Publix, and Kroger. This quartile has the highest top of mind (ToM) recall and the second highest financial performance. This group does not perform as well as the top quartile because their price and quality scores are not as strong, but this second group differentiates itself by excelling at secondary preference drivers, such as promotions, rewards, and information.

“Many undifferentiated mainstream banners are delivering minimal value to their shoppers. Even though many have been shopped at for a longer period, they have the weakest emotional connection. They must focus on improving value perceptions and reconnect with their shoppers or profitability will be a challenge in an increasingly competitive market.”
KC's View:
I have a lot of respect for dunnhumby’s ability to collect and analyze data, but I cannot help but have a little trouble with the idea that, seen on a level playing field, Publix is less preferred than Aldi.

But that’s okay. They just have a different reference point than I probably would have.

To me, the really important thing is the top three - Trader Joe's, Costco and Amazon - each of which is a completely different take on the traditional food shopping experience. What this tells us, if we are to believe the numbers, is that consumers simply are less enthralled with traditional stores than many would have us believe.

Success is found in the differences, not the similarities.