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Nielsen: Retailers And Manufacturers Need To Collaborate To Offer Greater Value

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Despite the price war, just 1% of shoppers believe they are getting better value 

Sydney, AUSTRALIA, October 17, 2013: Low promotional prices are not driving topline growth in the current retail market so retailers and suppliers need to collaborate to provide overall value, said Nielsen’s Head of Retail, Kosta Conomos, presenting at the Efficient Consumer Response Australasia (ECRA) annual conference today. 

Recent research by Nielsen, a leading provider of what consumers watch and buy, shows that increased price promotions are not changing shopper behaviour, and low prices are instead now seen as a hygiene factor. 

“Just one percent of shoppers believe they are getting better value overall compared to last year – and instead are using promoted products to supplement their shopping basket as a whole,” said Conomos. “Neither retailers nor suppliers benefit from this behaviour and instead they need to work together to offer overall value for the consumer to differentiate themselves through a combination of national brands and great quality private label goods in a far more targeted manner, as opposed to marketing to the masses. The key retailer battleground is set to become how to deliver more value.” 

Correspondingly, when asked what good value entails, just 20 percent of Australian shoppers said ‘low prices’ – and instead ‘fresh food and groceries’ was favoured by 30 percent; 27 percent want ‘good private label alternatives’; and 23 percent said ‘good deals and promotions’. 

Nielsen research shows that one in four shoppers swapped brands in the past year to buy what was on deal, and 20 percent said they would switch the store they shop at depending what was on special that week. However more than half of shoppers who bought products on deal used promotions to stock-up on what they already buy – and weren’t expanding their basket overall.

“We support joint industry efforts such as today’s ECRA conference that encourages various players to unite and strategise how to differentiate and improve the overall experience for shoppers – which therefore bolsters the industry as a whole,” added Conomos. 

“Another factor set to have major impacts on the industry is the shifts in purchasing behaviour, as more people go online to buy brands and do their shopping. Retailers need to understand this new dynamic, and work with suppliers to offer consumers an experience they feel is providing good value both on and offline, as this will allow for greater topline growth.” 

Nielsen analysis shows that that a solid nine in 10 online Australians (87%) make an online purchase every six months and a considerable 16 percent make an online purchase at least once a week. 

“There is no slowing this online movement, and as Australian consumers continue to engage with and uptake multiple digital devices, there is a huge opportunity for retailers and brands to capture the full path-to-purchase of the online shopping experience.” 

About Nielsen 

Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence, mobile measurement, trade shows and related properties. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA and Diemen, the Netherlands. For more information, visit www.nielsen.com.

Contact

Nicky Preston , + 61 451 036 595, [email protected]