CPG Marketing Trends: Lower-Income Shoppers Increase Grocery Spending

According to a recent article in Food Business News, a report on lower-income shoppers by SymphonyIRI finds that while lower-income shoppers have decreased spending in discretionary areas during the past two years, 31% of these consumers have increased what they spend on food and beverages.

In the past two years this group has decreased their spend on items such as clothes and shoes and has increased the amount spent on food and beverages.  This change in spend is caused in part by eating out at restaurants less and food price inflation.

“Many retailers and manufacturers take a one size fits all approach to reaching lower-income shoppers, but with $115 billion opportunity at stake and increasing competition to win their share of wallet, a mass market view of these shoppers will not be enough to win their loyalty,” said Sean Seitzinger, partner with Symphony Consulting, SymphonyIRI Group.

Some other findings to come out of this study were:

  • African-American make the most trips to the store per year, followed my seniors and Hispanics.
  • Lower income shoppers plan their shopping trips
  • More than half make unplanned impulse purchases in store, but 49% of them are more likely to keep track of their spend during a shopping trip and make budget-driven impulsive decisions compared with 38% of higher-income consumers.

Even though lower-income consumers in general have started purchasing private label to save money, 29% of the lower-income elderly consumers think name brands are worth the extra money, compared to 46% of African-Americans.  Sixty-four percent of younger households with children are more willing to sacrifice quality to get a better price compared to 51% of older households.

Photo credit: Richard Hsu

About

Brad is an expert in private label and challenger brand food marketing for Barkley, an integrated marketing and advertising agency. He specializes in working with manufacturing-driven food companies that have aspirations to develop a consumer insight-led strategies to help drive innovation and growth.

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