Transcript Walmart

Walmart Annual Shopper Review
January 2015
© Kantar Retail
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Disclaimers
The analyses and conclusions presented in this seminar represent the opinions of Kantar Retail. The views expressed do
not necessarily reflect the views of the management of the retailer(s) under discussion.
This seminar is not endorsed or otherwise supported by the management of any of the companies covered during the
course of the workshop or within the following slides.
© Kantar Retail
Executive Summary: Walmart Shopper Review
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‒ Shoppers’ preference for Walmart’s core format continues to decline. Shoppers are visiting the
Supercenter less frequently and spending slightly less on each trip, even as they feel they are on
relatively steady financial footing overall. As the Walmart shopper base shifts younger and toward
smaller households, finding new ways to engage shoppers and to drive traffic—especially beyond edible
grocery trips—will be essential.
‒ Perceptions of Walmart’s value proposition remain consistent. Seeking out low prices and finding
good deals continue to be the top priorities of Walmart’s core shopper. However, as shoppers also value
pleasant shopping experiences, the retailer has ground to make up in specific areas, such as the quality
of its fresh assortment as well as its ability to execute basic aspects of the in-store experience such as
maintaining in-stock position.
‒ Neighborhood Market penetration is growing, but the format still needs work. The expansion of
the Neighborhood Market (NM) footprint provides a valuable opportunity to win shoppers’ increasingly
smaller and more frequent trips. But that will require clarifying the value proposition for NM, which right
now is a stock-up destination for shoppers. In addition, the high rate of cross-shopping between NM and
the Supercenter highlights the potential for cannibalization between the formats, rather than new sales.
Source: Kantar Retail analysis
January 2015
© Kantar Retail
Executive Summary: Walmart Shopper Review
‒ Amazon’s penetration among Walmart’s core shoppers creates a significant competitive threat.
Not only is Amazon the top retailer cross-shopped by regular Walmart shoppers, but Walmart shoppers
also are more likely to frequent Amazon.com than they are to regularly visit Walmart.com. Creating a
shopping experience on Walmart.com that drives frequency and reach will be key.
‒ Shoppers’ engagement with mobile emphasizes the opportunities for engagement. Mobile is
starting to change the nature of interactions between shoppers and retailers. The reach of Walmart’s
mobile Savings Catcher tool, which launched in summer 2014 and had an almost immediate impact on
the depth of the retailer’s relationships with its shoppers, is a prime example. Shopper marketing will
need to reconsider the significance of this tool in the years ahead.
Source: Kantar Retail analysis
January 2015
© Kantar Retail
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Table of Contents
Shopper Penetration
– Penetration by banner, channel
– Demographic profile
Shopper Motivations
– Financial concerns
– Spending intentions
– Reasons to shop less
– Shopping priorities
Shopping Behaviors in Store
– Trips, trip type, and baskets: Supercenters, Neighborhood Market
– Where else Walmart shoppers shop
Brand Position: Price, Assortment, Experience, Access
– Value demands and perceived price leadership
– Perceptions of the Walmart shopping experience
Digital Interactions
– Mobile engagement
– Savings Catcher
January 2015
© Kantar Retail
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Shopper Penetration
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Penetration at the Walmart Supercenter continues to slowly decline, even as the retailer
adds new stores. Shopper traffic to Neighborhood Market (NM) and Walmart.com is
increasing as the retailer is making concurrent investments in these developing vehicles.
Meanwhile, the profile of the Supercenter and Discount shopper continues to shift. While
the regular Walmart shopper still largely skews lower income and larger household, the total
shopper base is becoming younger and higher income. In addition, likely in part because the
base is getting younger, smaller households are making up a bigger share of Walmart’s base—
which will influence what they look for in a one-stop stock-up trip.
The NM shopper is distinctive: younger, more urban, and more ethnically diverse than the
Supercenter’s shopper base. In a shift versus previous years, this shopper base’s degree of
affluence is now the same as the Supercenters—skewing mid- to low-income (i.e., less than
$50,000 a year)—instead of skewing slightly higher income. This shift may influence the types of
products sought in store.
Walmart.com’s shopper is also different: the base is younger and more likely to have
children at home versus the Supercenter’s core shopper base, making it a particularly attractive
audience. Contrary to popular stereotypes, this audience is not more affluent than Walmart’s
store shoppers—suggesting that low prices play a key consideration for both Walmart’s digital
and store audiences.
Sources: Kantar Retail analysis; store visits; website
January 2015
© Kantar Retail
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Weekly Shopper Penetration Rate Wanes
Penetration is softening across many channels, as many shoppers curb the number of
retailers they shop. The notable exception is the value and quick-trip convenience-oriented
value discount channel.
Percent of Households Shopping Channel at Least Weekly
Weekly Shoppers, by Channel
2009–2014
PPD
Supermarkets
+1.3
Convenience stores
-2.3
Mass channel
-0.3
Drug stores
+0.4
Value discounters/dollar stores
+3.2
Warehouse clubs
-1.0
Source: Kantar Retail ShopperScape®, October 2009, 2010, 2011, 2012, 2013, and 2014
January 2015
© Kantar Retail
Walmart’s Core Formats Lose Share
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Shopper penetration at Walmart’s core big boxes continues to decline, losing 7 percentage
points between 2007 and 2014—as Amazon nearly doubled its penetration. Meanwhile,
Neighborhood Market’s expansion is boosting its share.
Percent Shopped Walmart during Past Four Weeks, by Format
Amazon.com
*Analysis for Neighborhood Market is limited to states in which Neighborhood Market had a presence as of January 2014
Source: Kantar Retail ShopperScape® , January 2007–September 2014
January 2015
© Kantar Retail
NM Penetration Is Strong in Its Core Markets
A higher share of shoppers say they recently shopped NM in Walmart’s core markets: the
west, southwest, central, and southeast divisions. Penetration is lower in the northeast,
where there are fewer NMs per capita.
Percent Shopped Neighborhood Market in Past Four Weeks, by Region
9%
3%
10%
10%
9%
Regions based on Walmart’s small-format field structure
Source: Kantar Retail ShopperScape®, October 2013–September 2014
January 2015
© Kantar Retail
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Big-Box Shopper Profile Continues to Change
Walmart’s core shopper is now younger and higher income, and lives in a more densely
populated area than five years ago. These shoppers also have smaller households.
Demographic Profile of Monthly Walmart/WMSC Shoppers
Sample Size
<$25K
$25K–$49.9K
Annual HH Income
$50K–$74.9K
$75K–$99.9K
$100K+
All Shoppers
Q3 ‘14
12,211
25%
25%
18%
11%
21%
Monthly Walmart/WMSC Shoppers
Q3 ‘14
Q3 ‘13
Q3 ‘09
6,417
6,531
6,965
27%
27%
28%
28%
28%
29%
18%
18%
18%
10%
11%
11%
17%
17%
14%
PPT Difference
‘14–’13
‘14–’09
0.5
-0.4
0.1
-0.3
0.0
-1.0
-1.1
-0.1
-0.8
3.0
Kids in HH
Children under 19 at home
24%
28%
28%
30%
-0.1
-2.0
Generation
Generation Y (born 1982 to 2002)
Generation X (born 1965 to 1981)
Baby Boomers (born 1946 to 1964)
Seniors (born before 1946)
18%
31%
38%
13%
17%
31%
40%
12%
17%
31%
39%
14%
9%
32%
37%
22%
0.5
0.2
0.8
-1.5
8.0
-0.8
2.7
-9.9
Yes
12%
12%
12%
11%
-0.4
1.3
1 member
2 members
3+ members
27%
34%
39%
24%
34%
42%
19%
36%
45%
24%
34%
42%
5.3
-2.0
-3.3
0.5
0.1
-0.6
Own or are buying
Rent
Live with relatives (in their home)
63%
28%
7%
63%
27%
7%
64%
27%
6%
66%
27%
4%
-1.1
0.3
1.0
-2.9
0.6
3.0
<100k
100k–499k
500k–1,999k
2m +
10%
15%
21%
53%
15%
19%
23%
43%
18%
19%
23%
41%
19%
19%
25%
38%
-3.0
-0.5
+0.6
+2.0
-4.9
-0.2
+1.5
+5.6
Hispanic
Household Size
Home Ownership
Market Size
Note: Bolding/shading highlighting indicates significant difference between time periods noted (95% confidence level)
Source: Kantar Retail ShopperScape®, July–September 2009, 2013, and 2014
January 2015
© Kantar Retail
NM Shoppers Still Differ From the Supercenters
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NM’s shopper base has begun to align more with the Supercenter base over time, particularly
as NM’s base skews more lower income. But shoppers are more likely to live in denser
markets, aligning with the strength of the stores in suburban and urban markets so far.
Demographic Profile of Past Four-Week Shoppers
Walmart SC
Walmart NM
27,556
3,201
<$25k
27%
28%
$25k–$49.9k
28%
26%
$50k–$74.9k
18%
18%
$75k–$99.9k
11%
11%
$100k+
16%
17%
Rural
18%
8%
Small Town
22%
12%
Large Town
13%
14%
Suburban
36%
47%
Urban/City
11%
20%
Yes
27%
28%
No
73%
72%
Gen Y
18%
23%
Gen X
31%
33%
Boomers
38%
33%
Seniors
13%
11%
White Non-Hispanic
66%
52%
Black Non-Hispanic
13%
16%
Hispanic
14%
22%
Sample Size
Annual HH Income
Locale*
Kids in HH
Generation*
Race/Ethnicity
Source: Kantar Retail ShopperScape®, January–September 2014
January 2015
© Kantar Retail
NM shoppers also are more
likely to be younger as well
as to be Hispanic or
African American.
*See appendix for definitions
Note: Analysis limited to states in which NMKT was present as
of January 2014
Note: Highlighting indicates significant difference between
column percentages (95% confidence level)
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Walmart.com Shopper Profile Differs
Given younger shoppers’ affinity for digital tools, it is not surprising that Walmart.com’s
shopper base skews younger than the shopper base for the Supercenter.
Demographic Profile of Past Four-Week Shoppers
Walmart/WMSC
Walmart.com
22,836
4,296
<$25k
27%
27%
$25k-$49.9k
27%
28%
$50k-$74.9k
18%
18%
$75k-$99.9k
11%
11%
$100k+
17%
16%
Rural
18%
17%
Small Town
22%
21%
Large Town
12%
13%
Suburban
37%
34%
Urban/City
11%
15%
Yes
26%
30%
No
74%
70%
Gen Y
18%
19%
Gen X
31%
34%
Boomers
39%
38%
Seniors
12%
9%
White Non-Hispanic
68%
66%
Black Non-Hispanic
12%
15%
Hispanic
13%
12%
Sample Size
Annual HH Income
Locale*
Kids in HH
Generation*
Race/Ethnicity
Source: Kantar Retail ShopperScape®, January–September 2014
January 2015
© Kantar Retail
Walmart.com shoppers are
also more urban and more
likely to have kids,
highlighting the opportunity
to cater to young families
with the convenience offered
by online shopping.
*See appendix for definitions
Note: Highlighting indicates significant difference between
column percentages (95% confidence level)
Table of Contents
Shopper Penetration
– Penetration by banner, channel
– Demographic profile
Shopper Motivations
– Financial concerns
– Spending intentions
– Reasons to shop less
– Shopping priorities
Shopping Behaviors in Store
– Trips, trip type, and baskets: Supercenters, Neighborhood Market
– Where else Walmart shoppers shop
Brand Position: Price, Assortment, Experience, Access
– Value demands and perceived price leadership
– Perceptions of the Walmart shopping experience
Digital Interactions
– Mobile engagement
– Savings Catcher
January 2015
© Kantar Retail
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Shopper Motivations
A strengthening job market throughout the year, and falling gas prices to end it, has
bolstered shoppers’ financial positions overall. But rising prices elsewhere are pressuring
Walmart shoppers’ ability to spend, and shoppers’ growing tendency to shop less in general
are cutting into Walmart’s traffic.
•
Walmart shoppers feel their financial health is about
the same as it was last year, though some feel their
income positions have strengthened.
•
Still, a higher share of shoppers is shopping Walmart
less often, largely a result of shopping less overall. In
addition, Walmart’s core low-income shoppers’ capacity to
spend is still being challenged by rising prices and
household essentials spending.
•
As shoppers seek out shopping experiences that are worth
their time, priorities around product quality,
assortment, and in-stocks are now more important
than they were five years ago; conversely, one-stop
shopping is less important.
Sources: Kantar Retail analysis; store visits
January 2015
© Kantar Retail
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Walmart Shoppers’ Financial Health Is Steady
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Across metrics, Walmart shoppers largely feel their financial health is about the same as last
year, though their confidence in their income levels has improved.
Household Financial Health of Walmart Shoppers
Q3 2013
Job security
Much better/somewhat better off
No change from last year
Somewhat worse/much worse off
Household Income level
Much better/somewhat better off
No change from last year
Somewhat worse/much worse off
Credit card debt
Much better/somewhat better off
No change from last year
Somewhat worse/much worse off
Monthly mortgage/car payments
Much better/somewhat better off
No change from last year
Somewhat worse/much worse off
Worth of investments
Much better/somewhat better off
No change from last year
Somewhat worse/much worse off
Value of home
Much better/somewhat better off
No change from last year
Somewhat worse/much worse off
Q3 2014
20%
62%
18%
21%
64%
15%
28%
47%
24%
30%
49%
21%
26%
56%
18%
25%
57%
18%
22%
66%
12%
20%
68%
11%
26%
57%
16%
26%
60%
13%
28%
58%
14%
29%
61%
10%
Measured across a range of
factors, significantly more
shoppers than last year feel
their financial health has
stayed about the same.
However, a higher share feels
better about income levels,
likely a result of the stronger
job market.
Note: Shading indicates significant year-to-year difference (90% CL)
Source: Kantar Retail ShopperScape®, July-September 2013 and July-September 2014
January 2015
© Kantar Retail
Overall, Spending Plans Have Improved
Walmart shoppers’ spending intentions are gaining traction over time, in line with all
shoppers. A majority aim to hold spending steady, while nearly one-third are still curbing
their budgets—indicating that value appeals are still very important.
Near-Term Spending Plans: Percent Planning to
Spend More/About the Same
vs. Same Time Last Year
Near-Term Spending Plans vs. Same Time Last
Year: Q3 2014
(three-month moving average)
Note: No significant differences between all shoppers and Walmart shoppers
(90% confidence level)
Source: Kantar Retail ShopperScape®, January 2009–September 2014 and July-September 2014
January 2015
© Kantar Retail
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Top Reasons Leading Those to Spend Less
Of the nearly one-third of Walmart shoppers planning to spend less, Have Not households’
spending on essentials such as food and fuel is more likely to limit those shoppers’ ability to
spend at retail; conversely, Haves are simply looking to save more.
Walmart Shoppers’ Reasons for Spending Less at Retail
(among past four-week Walmart/WMSC shoppers who said they planned to
spend less at retail in the coming month vs. the same time a year ago)
Have Nots*
Haves*
Not as much left over after buying food/HH essentials
52%
39%
HH income not keeping up with rising prices
46%
30%
Trying to simplify my life by buying fewer things
34%
36%
Trying to reduce/pay down credit card balances/debt
31%
35%
Saving more in general
27%
35%
Concerns about present economic conditions
30%
28%
HH income is lower vs. last year
28%
26%
Just have fewer needs this year than I did a year ago
24%
25%
Spending more on gasoline
26%
17%
Concerns about economic conditions 6 to 12 months from now
22%
22%
Spending more on healthcare
22%
20%
Spending more on home heating/cooling costs
23%
14%
*”Have Nots” are those with an annual household income of less than $60k; “Haves” are those with an annual household income of $60k+.
Note: Shading indicates significant year-to-year difference (90% CL)
Source: Kantar Retail ShopperScape®, September 2014
January 2015
© Kantar Retail
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One-in-Five Is Visiting Walmart Less Often
An overall pullback in shopping is driving shoppers to visit Walmart less frequently. Other
key reasons also involve shoppers looking for a more “pleasant” or “convenient” experience.
Shopping Frequency at Walmart/WMSC Compared
with Same Time a Year Ago
Reasons for Shopping Less Often at
Walmart/Walmart Supercenter
May
2013
May
2014
Just shopping less in general
40%
44%
Other retailers offer more pleasant shopping
experience
28%
21%
Shopping other retailers more conveniently located
25%
20%
Can find better overall value at other retailers
22%
18%
Doing more shopping at supermarkets
20%
20%
Shopping more at retailers where can get in and
out quickly
18%
15%
Doing more shopping at Target/SuperTarget
18%
16%
Doing more shopping at dollar stores
14%
14%
Doing more shopping at online-only retailers
13%
12%
Dividing shopping between more stores; doing less
one-stop shopping
12%
10%
Doing more shopping at warehouse clubs
9%
10%
Note: Shading indicates significant year-to-year difference (90% CL)
Source: Kantar Retail ShopperScape® May 2013 and May 2014
January 2015
© Kantar Retail
Walmart Shoppers’ Priorities Have Shifted
Compared with their attitudes just after the recession, Walmart shoppers are now more
focused on product quality, assortment, and availability in Walmart’s core categories.
Largest Changes in Reasons for Store Choice for Food/Groceries and HBC: 2014 vs. 2009
(among past four-week Walmart/WMSC shoppers)
Food/Groceries
HBC Products
Less Important vs. 5 Years Ago
Less Important vs. 5 Years Ago
Convenient location
Convenient location
Ability to one-stop shop
Better value
Open 24 hours
Ability to one-stop shop
More Important vs. 5 Years Ago
More Important vs. 5 Years Ago
In-stock on items I want
High quality products
High quality fresh foods
Broad selection of preferred products
More brands I like
Broad selection of brands
Source: Kantar Retail ShopperScape®, Feb/May/Aug 2009 and Feb/May/Aug 2014
January 2015
© Kantar Retail
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Table of Contents
Shopper Penetration
– Penetration by banner, channel
– Demographic profile
Shopper Motivations
– Financial concerns
– Spending intentions
– Reasons to shop less
– Shopping priorities
Shopping Behaviors in Store
– Trips, trip type, and baskets: Supercenters, Neighborhood Market
– Where else Walmart shoppers shop
Brand Position: Price, Assortment, Experience, Access
– Value demands and perceived price leadership
– Perceptions of the Walmart shopping experience
Digital Interactions
– Mobile engagement
– Savings Catcher
January 2015
© Kantar Retail
20
Shopping Behaviors
21
Walmart’s grip on the stock-up trip is strong. But as its shopper penetration erodes and
customer traffic wanes, it has seen flat to declining comps for most of 2014 and 2013. Lifting
comps will depend on targeting specific areas of improvement in the Walmart shopping
experience.
•
Edible grocery remains a powerful trip driver for the
Supercenter. Walmart’s efforts to improve its fresh
proposition with shoppers will be an important tool in
boosting the frequency and basket size of these trips.
•
NM also threatens to cannibalize the Supercenter’s
position, given its popularity as a stock-up destination and
high cross-shopping rates in areas where NM is present.
Honing NM’s assortment and messaging will be key to help
differentiate the format’s proposition.
•
Amazon continues to represent a formidable
competitor to Walmart. Walmart.com has opportunity to
increase both its reach and visit frequency with Walmart
shoppers.
Source: Kantar Retail analysis; store visits
January 2015
© Kantar Retail
22
Trips to Walmart Pick Up Slightly This Year
Shoppers’ average monthly trips to Walmart discount and supercenter stores ticked up in
2014. While this reverses the recent trend for Walmart, it is in line with overall trends in the
channel. This rate is still behind NM shoppers, as they visit the store roughly six times a
month.
Average Number of Trips per Month*
Comparatively,
NM shoppers
now report
making an
average of 5.9
trips per month.
Note: *Self-reported
Source: Kantar Retail ShopperScape®, Feb/May/Aug/Nov 2010 , 2011, 2012, 2013, and 2014
January 2015
© Kantar Retail
23
Food Drives Half of Trips to Supercenter
Grocery and consumables motivate the vast majority of trips to the Supercenter. Moving this
traffic around the store through cross-box solutions that incorporate general merchandise will
continue to be an important goal for Walmart.
Main Reason for Last Trip to Walmart Supercenter Was to Buy …
HH
essentials
General
merchandise
Edible grocery items
HBC
Areas of Store Shopped/Purchased on Last Trip to Walmart Supercenter
Shopped
Highlighting the
opportunity to support
cross-box conversion
from grocery to
general merchandise
Conversion Rate
65%
60%
53%
38%
Purchased
42%
37%
44%
37%
Edible grocery items
General merchandise
HH essentials
HBC
91%
72%
87%
84%
Source: Kantar Retail ShopperScape®, May 2014
January 2015
© Kantar Retail
Supercenter, NM Are Stock-Up Destinations
The Supercenter remains a stock-up destination, though many also use the store for quicktrip needs. Despite NM’s supposed role in Walmart’s portfolio as a fill-in trip destination, a
higher share of its shoppers fulfill their stock-up trips at Neighborhood Market, though quick
trips also are popular. In contrast, Dollar General is predominately a quick trip destination.
Primary Reason for Last Trip to Retailer
(last trip to buy food/groceries/HH essentials/HBC products)
*Analysis for all three retailers limited to states in which Neighborhood Market was present as of January 2014
Source: Kantar Retail ShopperScape®, Aug/Nov 2013, Feb/May/Aug 2014
January 2015
© Kantar Retail
24
25
Basket Size Continues to Tick Down
Suggesting a shift toward smaller-ticket purchasing, Walmart Supercenter/Discount
shoppers’ basket sizes again declined in 2014—though the NM basket is still 13% smaller.
Grocery remained about 75% of the Supercenter/Discount basket, versus 80% for NM.
Amount Spent on Last Trip to Walmart/WMSC*
(most recent trip to buy food/groceries/
HH essentials/HBC)
$96
$88
More effective cross-box merchandising could be
an important tool to diversify and build baskets
when shoppers are oriented toward smaller trips
$101
$99
$95
Comparatively, shoppers reported spending $83 on their
last trip to NM in 2014, with 80% of this spent on food,
household essentials, and HBC items
Note: *Self-reported
Source: Kantar Retail ShopperScape®, Feb/May/Aug/Nov 2010 , 2011, 2012, 2013, and 2014, Aug/Nov 2013 and Feb/May/Aug 2014
January 2015
© Kantar Retail
26
Amazon, Dollar Stores Expand Reach
Amazon remains the top cross-shop destination for Walmart Supercenter/Discount shoppers,
and Dollar Tree and Dollar General also have increased their penetration.
Top 25 Retailers Cross-Shopped by Walmart/WMSC Shoppers
Jan–Oct 2009 Jan–Oct 2014
Amazon.com
Walgreens
Target/SuperTarget
Dollar Tree
The Home Depot
CVS/pharmacy
Lowe’s
Kohl's
Dollar General
Kroger (all banners)
JCPenney
eBay.com
Sam’s Club
Family Dollar
Best Buy
Macy's
ALDI
Bath & Body Works
Costco
Kmart
PetSmart
Barnes & Noble
Bed Bath & Beyond
Staples
Michaels
30%
39%
44%
24%
31%
28%
31%
27%
25%
23%
30%
23%
22%
18%
23%
18%
10%
n/a
14%
19%
15%
18%
14%
17%
15%
54%
36%
33%
32%
31%
29%
29%
29%
28%
25%
24%
21%
21%
20%
19%
18%
17%
17%
15%
15%
15%
15%
15%
14%
14%
PPT Diff
‘14 vs. ‘09
24.0
-3.5
-10.1
7.8
-0.5
0.8
-1.6
2.2
2.5
1.5
-5.8
-1.6
-1.1
1.4
-3.6
0.4
6.4
n/a
1.3
-3.9
0.3
-3.1
0.6
-3.5
-1.3
The dollar stores’ and Aldi’s
gains in penetration among
Walmart shoppers emphasize
the intensifying competition for
consumables trips.
Meanwhile, many of the
retailers that have experienced
the biggest cross-shopping
declines among Walmart
shoppers have concurrently
seen sales struggles overall
and increased competition
from Amazon and others in
general merchandise
categories.
Note: Shading indicates significant difference between column percentages (95% confidence level)
Source: Kantar Retail ShopperScape®, January-October 2009 and 2014
January 2015
© Kantar Retail
For Walmart.com, Amazon Is a Big Challenge
Amazon has nearly three times the online penetration with Walmart shoppers than
Walmart.com does. And Walmart shoppers are hooked: one in five shop Amazon weekly,
twice the number who shop Walmart.com that often. Driving reach and frequency are two
key concerns for Walmart.com.
Walmart Shoppers
Shopping Frequency
Top 10 Online Retailers Shopped by
Walmart Shoppers
1
Amazon.com
54%
2
eBay.com
21%
3
Walmart.com
19%
4
Kohls.com
9%
5
BestBuy.com
9%
6
JCPenney.com
9%
7
Target.com
8%
8
BarnesandNoble.com
7%
9
Macys.com
7%
10
HomeDepot.com
7%
Source: Kantar Retail ShopperScape®, September 2013–August 2014
January 2015
© Kantar Retail
27
28
For NM, Regional Grocers Present a Challenge
NM shoppers’ cross-shopping patterns highlight regional competition for grocery dollars—as
well as the potential for NM to cannibalize the Supercenter. For instance, in the central
division, nearly every NM shopper also shops the Supercenter.
Top Grocery Retailers Also Shopped by Neighborhood Market Shoppers, by Region
Northeast
Central
West
Walmart/WMSC
60%
Walmart/WMSC
85%
Walmart/WMSC
65%
Costco
49%
Sam’s Club
33%
ALDI
29%
Safeway
34%
ALDI
28%
Kroger
27%
Albertsons
32%
Whole Foods
14%
Sam’s Club
26%
Trader Joe’s
31%
Hy-Vee
12%
Food Lion
20%
WinCo Foods
25%
Dillons
11%
Whole Foods
19%
Southwest
Southeast
Walmart/WMSC
76%*
Walmart/WMSC
77%
Albertsons
34%
Publix
69%
Sam’s Club
30%
Winn-Dixie
42%
Costco
25%
Sam’s Club
28%
Sprouts
25%
ALDI
24%
H-E-B
22%
Save-A-Lot
18%
Whole Foods and other specialty grocers
(Sprouts, Trader Joe’s) notably have a solid
cross-shop with NMKT shoppers across regions
*Read as: 76% of Neighborhood Market shoppers
also shopped at the Supercenter.
Note: Regions based on Walmart’s small-format field structure. Including grocery, Walmart, and club competitors
Source: Kantar Retail ShopperScape®, October 2013-September 2014
January 2015
© Kantar Retail
Table of Contents
Shopper Penetration
– Penetration by banner, channel
– Demographic profile
Shopper Motivations
– Financial concerns
– Spending intentions
– Reasons to shop less
– Shopping priorities
Shopping Behaviors in Store
– Trips, trip type, and baskets: Supercenters, Neighborhood Market
– Where else Walmart shoppers shop
Brand Position: Price, Assortment, Experience, Access
– Value demands and perceived price leadership
– Perceptions of the Walmart shopping experience
Digital Interactions
– Mobile engagement
– Savings Catcher
January 2015
© Kantar Retail
29
Brand Position
Price, Assortment, Experience, Access
Walmart continues to emphasize its low price promise to
its value-conscious shopper base—as these demands are
still of primary importance. However, the retailer also
recognizes that assortment, experience, and access are
also very important—raising the strategic importance of
these dimensions. The retailer is working to fix its
immediate problems as well as to enable more solutions
to meet shoppers’ rising demands.
• Shoppers’ perceptions of Walmart’s price position
is strong, though supermarkets contend for value
perceptions in fresh, and to a lesser extent nonperishable grocery.
• Assortment and experience dimensions of the trip
have the opportunity to improve, including opinions
of in-stocks, food selection, and store service.
Sources: Kantar Retail analysis; store visits
January 2015
© Kantar Retail
30
Value Matters Most to Walmart Shoppers
31
Spending less is the top priority for Walmart shoppers, and it matters more to them. Notably,
having fun also is more important to Walmart shoppers, and having a stress-free experience
ranks just behind value considerations.
What Matters to Shoppers
(% ranking factor among top four most important when shopping)
Arrows indicate a significant difference between Walmart shoppers and all shoppers (95% confidence level)
Source: Kantar Retail ShopperScape®, January–October 2014
January 2015
© Kantar Retail
32
Walmart Has Price Leadership, Mostly
Impressions of Walmart’s price leadership are positive and relatively strong across
categories. The exception is fresh grocery, where supermarkets far outpace Walmart.
Shoppers also are divided on non-perishable grocery, where as many feel Walmart leads, as
do supermarkets.
Type of Retailer Viewed as Price Leader, by Category
(among all primary HH shoppers)
44%
36%37%
32%
31%
Shoppers’
perceptions of
supermarkets’ fresh
price proposition
are much higher
23%
18%
14%
10%
Walmart/Walmart
Supercenter
Supermarkets
12%
10%
8%
4%
5%
Fresh grocery
Source: Kantar Retail ShopperScape®, November 2014
January 2015
© Kantar Retail
5%
4%
2%
1%
Warehouse clubs Target/SuperTarget
Non-Perishable Grocery
13%
11%
9%
Dollar stores
HH cleaning/paper
HBC
2% 1% 3%
Drug stores
33
Clear Room for Improvement in Experience
Walmart’s price promises largely measure up, but its efforts to improve in-stocks and to tailor
assortment will be important to meet shoppers’ expectations. Also, not many agree that
Walmart is a “pleasant” place to shop.
Ideal Grocery/HH Essential/HBC Shopping Experience vs. Shopping Experience at Walmart
(among past four-week Walmart/WMSC shoppers)
85%
85%
80%
72%
65%
60%
56%
50%
50%
46%
50%
33%
30%
21%
20%
13%
Knowing I'm
paying a low
price
Feel like I'm
Private label Items I want are
Food offer
getting a "good brands in many
in-stock
matches up with
deal"
categories
what I like to
cook/eat
Price
High-quality
private label
brands
Local food
products
available
Assortment and Access
Important when grocery/HH essential/HBC shopping
Source: Kantar Retail ShopperScape®, May 2014
January 2015
© Kantar Retail
18%
7%
17%
7%
15%
2%
Local interest Fun/pleasant to Store associates
Can use
items available
shop
available to give Walmart app to
good advice
make in-store
experience
easier
Experience
Describes shopping experience at Walmart
Table of Contents
Shopper Penetration
– Penetration by banner, channel
– Demographic profile
Shopper Motivations
– Financial concerns
– Spending intentions
– Reasons to shop less
– Shopping priorities
Shopping Behaviors in Store
– Trips, trip type, and baskets: Supercenters, Neighborhood Market
– Where else Walmart shoppers shop
Brand Position: Price, Assortment, Experience, Access
– Value demands and perceived price leadership
– Perceptions of the Walmart shopping experience
Digital Interactions
– Mobile engagement
– Savings Catcher
© Kantar Retail
34
Digital Interactions
As how shoppers interact change, so to must Walmart’s means of engaging them. In
particular, mobile devices are becoming the interface of these exchanges, as using these
devices to search for coupons or research assortment options is becoming increasingly
popular—especially among Walmart’s base.
•
Walmart’s rollout of Savings Catcher, its digital pricematching tool—as well as the program’s quick uptake by
shoppers—highlights the willingness of shoppers to take
part in mobile and its ability to drive relationships with
shoppers in the store.
•
Even as Walmart increases its investments in digital,
the retailer still has opportunity to build its reach, as its
mobile connection with shoppers lags behind competitors
such as Amazon and Target. Investments in mobile will be
a key means to integrate digital into the established
Walmart shopping experience and to reach increasingly
connected shoppers.
Sources: Kantar Retail analysis; store visits
January 2015
© Kantar Retail
35
36
Walmart Shoppers Highly Engaged via Mobile
Walmart shoppers are more likely to engage in a range of activities on smartphones,
particularly when it comes to savings- and assortment-oriented features.
Activities Engaged in on Smartphone during Past Six Months
(among smartphone owners)
Index: Walmart
Shoppers vs. Total
111
110
110
107
104
121
104
111
105
108
100
108
100
Note: Green indices indicate significantly greater vs. all shoppers (95% confidence level)
Source: Kantar Retail ShopperScape®, March 2014
January 2015
© Kantar Retail
37
But Walmart Itself Can Improve Engagement
When it comes to interacting with its own shoppers via its mobile app, Walmart trails
Amazon, Target, and Costco. About half of its shoppers who use the app used it in-store,
however, indicating the opportunity for suppliers to support in-store mobile integration efforts.
Percent of Retailers’ Past Four-Week Shoppers Who Used Retailer Apps in Past Few Months
(among smartphone owners)
34%
Used app
Used app IN RETAILER STORE
24%
19%
16%
15%
15%
14%
13%
11%
9%
7%
7%
6%
8%
6%
3%
7%
4%
3%
n/a
Amazon
Target
Costco
CVS
Walmart
Walgreens
Source: Kantar Retail ShopperScape®, January 2014
January 2015
© Kantar Retail
Best Buy
Sam's Club Home Depot
Lowe's
Savings Features Are Top Mobile Priority
38
Walmart shoppers rank access to promotions their top priority for mobile app features, with
tools that make the store experience easier—such as item location, geo-targeted deals, and
lists—not far behind. Accordingly, Walmart advertised such deal features on its app this
past holiday.
What Shoppers Would Like to Be Able to Do on Walmart App In-Store
(among Walmart shoppers who own a smartphone)
Note: Gen Y Walmart shoppers significantly more likely to want every feature vs. all Walmart shoppers (95% confidence level)
Source: Kantar Retail ShopperScape®, January 2014
January 2015
© Kantar Retail
Savings Catcher Tool Is Catching On
A month after this digital ad match tool rolled out nationally, Savings Catcher had already
garnered widespread awareness, and even higher awareness among Walmart shoppers.
Awareness of Walmart’s Saving Catcher Tool
(% of shoppers who are aware of Savings Catcher)
*Recent shoppers are those who have shopped Walmart/WMSC during the past four weeks; regular shoppers are those who
say they usually shop Walmart/WMSC every month
Source: Kantar Retail ShopperScape®, September 2014, Kantar Retail store visits
January 2015
© Kantar Retail
39
Young, Affluent Shoppers More Likely to Use Tool
40
About one in five Walmart shoppers have already used Savings Catcher; that figure jumps to
two in five among those who are aware of the tool. Walmart’s Gen X and “Have” shoppers
are most likely to have used Savings Catcher.
Percent of Walmart Shoppers Who Have Used Savings Catcher, by Cohort
Walmart recently reported that 81% of the Savings Catcher receipts came through mobile devices, indicating that
this program is driving usage of Walmart’s mobile app.
*Have Nots have an annual HH income of less than $60k; Haves have an annual HH income of $60+
Source: Kantar Retail ShopperScape®, September 2014
January 2015
© Kantar Retail
41
For further information please refer to
www.kantarretail.com
Contact:
Laura Kennedy
Principal Analyst
[email protected]
+1 617 912 2851
Rachel McGuire
Principal Analyst
[email protected]
+1 614 355 4036
www.kantarretailiQ.com
kantarretail
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© Kantar Retail
Appendix: ShopperScape® Key Definitions
42
Generational Cohorts
 Gen Y: Born 1982–2002 (note: ShopperScape® surveys heads of household 18+, so Gen Y respondents in ShopperScape® are
18 to 32 years old in 2014)
 Gen X: Born 1965 to 1981 (33 to 49 years old in 2014)
 Boomers: Born 1946 to 1964 (50 to 68 years old in 2014)
 Seniors: Born in 1945 or earlier (69 or older in 2014)
Haves & Have-Nots
 Haves: Annual HH Income > $60,000
 Have-Nots: Annual HH Income $60,000+
Locale
 Rural: I have to drive more than 10 miles to do even basic shopping (such as for groceries)
 Small Town: I live in or near a town where I can do all or most of my everyday shopping (such as for groceries) and shopping
for some special purchases (such as a television or dress apparel), but I have to travel to a larger city to have more than a
couple of options for shopping for special purchases
 Large Town: I live in or near a large town where I do all or most of my shopping, both for everyday needs and special
purchases, but the town is not immediately next to a major metropolitan area
 Suburban: I live in a community surrounding a major metropolitan area that contains many retail shopping options, including
multiple grocery stores, shopping centers, etc.
 Urban/City: I live in a densely populated neighborhood where I primarily/exclusively walk or use public transportation/cabs to do
my everyday shopping (such as for groceries)
© Kantar Retail