Graduates Win with Aunts and Uncles


 
Graduation Season is here! The time to celebrate a lifetime of accomplishments and the beginning of a promising new stage. Parents couldn’t be prouder, Grandma is definitely going to cry, and aunts and uncles apparently get generous.

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According to one of our recent surveys, more graduation gifts are purchased for nieces and nephews than anyone else. This makes sense, especially in bigger families where people likely have have more nieces and nephews than sons or daughters. So what are they gifting?

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Graduates received mostly gift cards this year, with greeting cards and actual cash also among the popular gift-giving options. Other gifts like coffee and cars—much needed elements of adulthood—get honorable mentions. Female grads were more likely to receive flowers, while male grads were more likely to receive electronics.
 

When deciding what to gift a graduate, the number one consideration was “something that would be useful” in the next stage of their life. One curious data point also related to this decision is that uncles and aunts were more likely to ask the family and friends of the grad for gift recommendations, while mom and dad were more likely to ask the grad directly.

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Gift card purchasers are twice as likely to buy a greeting card in the same shopping trip during graduation season than during the Christmas season. The difference suggests that shoppers try to get gift and greeting cards in the same trip for graduates, while spreading the purchase of those two categories across more trips during the holiday period.

 

Another tip for all retailers out there: an overwhelming 61% of shoppers return to buy their graduation greeting cards at the same retailer where they bought their Mother’s Day card. So if you’re capturing that Mother’s Day shopper, you’re more likely to capture the graduation greeting card shopper.

 

As to which retailers people prefer for purchasing their greeting cards, the usual suspects of Walmart and Target show up on top. There is also a considerable showing from the dollar channel (Dollar Tree and Dollar General), which achieved significantly high unit sales but underperformed in dollar sales, a common trait for the channel due to its usually lower price points.

 

In summary, parents need to step up their gifting game. Spoiling uncles everywhere are going for the cash game while parents skew towards the traditionally more emotional and thoughtful greeting cards.
 
As a marketer, are you interested in knowing more about seasonal gifting in your category or other aspects of shopping behavior? Are you curious about which brands of gift cards these graduates received? Get in touch with us at contactus@infoscoutinc.com and we’ll be happy to help you out!

Retailers Face Heavy Deflationary Headwinds this Holiday Season

Powered by over 170,000 consumer panelists, InfoScout’s real-time read on Thanksgiving Day and Black Friday sales indicates that early reports of a strong holiday shopping season for America’s major retailers may be inflated.

With consumer electronics dominating the list of best sellers at Walmart, Target, Best Buy and even Kohl’s, these retailers now find themselves exposed to the deflationary pressures of the gadget industry.   Last year, consumers were exposed to exciting new products, and shoppers swarmed in to seize the new must-haves like the iPad Air, Beats Headphones, PlayStation 4, and Xbox One.  As an industry that relies on innovation, the relative lack thereof in 2014  has left American shoppers unwilling to spend more for only minimally improved versions of their favorite products.  With their top-selling items now on-shelf at reduced prices, retailers will need to sell many more units than last year to keep pace with sales from the 2013 holiday season.

The list of best selling products in each of Walmart’s top holiday categories is remarkably unchanged, with slightly better offerings at predominantly lower prices.

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Target carries a similar assortment of products to Walmart and therefore faces similar deflationary headwinds this holiday season.   Sales of iPads had accounted for such a large percentage of Target’s holiday sales in 2013, that the retailer will have to steer shoppers towards other products in 2014 in order to overcome the large year-over-year price reductions.

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Even the highly innovative Amazon has struggled to improve upon its Kindle Fire offering from last year.   In fact, consumers are trading down this year from 7-inch to a 6-inch display at a much lower price point.

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It should be no surprise then that average basket values appear to be down across almost every major retailer compared to the year prior.  Early data coming in from InfoScout’s panelists’ shopping in stores on Black Thursday & Black Friday indicate that only Macy’s has managed even the slightest gain in their average transaction.  While this data is just a preliminary read, it is derived from more than 42,000 shopping trips reported thus far at the retailers below.

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To stay on top of America’s shopper journey throughout this retail holiday season, be sure to subscribe (above) for real-time updates.

(Author’s note:  Special thanks to Ben Ahn & Bret Weinberg for their real-time reporting.)

 

First Read on Black Thursday’s Top Sellers

With many stores opening for business before most of us could even finish our plate of Thanksgiving turkey, the unofficial start to the holiday shopping season is officially underway… a lot earlier this year. With retailers no longer waiting until the traditional Black Friday to begin their doorbuster sales, Black Thursday (also dubbed “Grey Thursday”) is inarguably becoming the new norm among retailers anxious to draw customers in early. Shoppers flooded the aisles of Walmart at 6PM on the dot to get their hands on some of the hottest deals, and this data is coming in hot here at InfoScout’s San Francisco headquarters. Here’s a very early look at three major retailers’ top selling items on Black Thursday:

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Methodology:
Data collected from the first 5,000 Walmart receipts, 1,000 Target receipts, and 300 Amazon receipts submitted by InfoScout Panelists on ‘Black Thursday’ (Thanksgiving Day).

Walmart’s Millennial Problem: 5 Reasons Dollar Stores are Beating the World’s Largest Retailer

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It’s no secret that Millennials’ widespread adoption of technology has helped transform many industries. Their use of social media has shifted how we communicate, their adoption of smartphones has changed how we shop, and their use of taxicab replacements like Uber and Lyft is altering how we get around. Even Walmart’s tried and true grocery business has not been spared. As Millennials enter their 30s, they are beginning to influence a grocery sector traditionally dominated by multi-person households. 3 factors are driving this:

  1.  The Millennials (born between the early 1980s and 2000s), at 78 MM, are the largest U.S. demographic group today
  2.  As shoppers, Millennials favor convenience and wear their ideals on their sleeves
  3.  Due to societal trends and poor job prospects, Millennials are delaying marriage and family formation

From 2007 to 2012, the percentage of young Americans who are married fell from 30% to 25%.  As Millennials wait to marry and have kids, their grocery behavior deviates from those of past generations. A single-person household has fewer needs than a full family, and thus purchases a smaller quantity of products in a given week. As a consequence, single Millennials can complete their grocery trips more quickly than someone stocking the pantry for an entire family. So why would a Millennial spend close to an hour pushing a cart around a giant Walmart store when he or she can get in and out of a smaller dollar store in half an hour or less? Using InfoScout’s database of U.S. grocery shopping behavior, we determined this is more or less exactly how consumers shop at Walmart and dollar stores. For example, at Walmart, the average basket is 13.5 items while at Dollar General, it’s only 6.3. We also studied where else Walmart shoppers bought groceries in the first half of 2013, discovering that more than 1-in-4 started spending relatively less at Walmart and more at dollar stores over time. Who are these dollar store ‘converts’?

  •  Lower income: 50% earn less than $60K per year
  •  Unemployed: almost 2x as likely to be unemployed
  •  Young: 43% are between age 21 and 34

By means of InfoScout survey data, we also identified the top reasons these customers are leaving Walmart for dollar stores:


spending#1 Consumers are having a hard time making ends meet:
31% of dollar store ‘converts’ either lost a job or had hours reduced within the last 6 months

#2 Their grocery budgets are falling: 37% of dollar store converts decreased their grocery budget over the last 6 months

#3 The Walmart brand doesn’t resonate: converts are 2.5x as likely to complain about the Walmart brand

#4 Dollar stores expanding and getting closer to Walmart’s customers: Family Dollar, Dollar General, and others opened hundreds of new stores in 2013.  24% of converts had a new dollar store open nearby within the last 6 months (often within walking distance, important to Millennials who are less likely to have a car compared to earlier generations at the same age)

#5 Shopping at Walmart isn’t convenient, especially for quick trips: 24% of dollar store converts say Walmart stores are inconvenient, too big, or confusing to navigate.  In addition, 77% dollar store shoppers name location and convenience as the primary reason why they shop at dollar stores versus just 60% for Walmart.

 

This trend is not limited to Walmart – So what can retailers and brand marketers do?

  • Offer great prices on the products that matter most to this segment
  • Invest in new smaller-footprint store formats, and make it easier to get in and out quickly
  • Reach Millennials where they spend their time (online and social media), support causes Millennials care about, offer innovative products to save them time, and reward them for their loyalty

Now what Millennial wouldn’t take interest in that?

 

InfoScout’s Black Friday Breakdown

It’s been an insightful couple of days here at InfoScout as we monitored & analyzed Black Friday activity in real-time.  With over 100,000 shopping trips captured from our panel of 125,000+ Americans, we had plenty of item-level purchase data to answer some of the most pressing Black Friday shopping questions. By tracking retailer performance, top products purchased & consumer sentiment throughout the day, we found a couple of nuggets worth bubbling up.

So to wrap up the Black Friday shopping frenzy, we’ve created a high-level summary of key findings & insight :

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Interested in learning more? Explore our in-depth blog posts deep-diving into consoles, top 20 purchases at Walmart, sources  of iPad purchases, and more.

For more information about how InfoScout captures data & our methodologies, checkout www.infoscout.co/data

Most avoided retailer on Black Friday?

Walmart may draw in 50% more shoppers than any other retailer this Black Friday, but it’s also by far the most avoided retailer on Black Friday…

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By far, the most common complaints of Walmart shoppers today have been checkout lines that are too long and stock-outs on key products.  Digging a bit deeper, however, we thought we’d share some additional comments from our panelists in response to the question, “What would have made your shopping trip even better?”

“The store was difficult to navigate. Typically checkout is a free for all. This the they had a secret entrance that led you through a weaving maze with all of your items to be assigned a checkout station. It created panic and frustration as people did not know where or how to get into the check out line this year. Good try Walmart but not good enough.”

“My wife not calling me four times while I was in the store, adding crap to the list.”

“Nothing!!! Loved the idiots and atmosphere of this shopping experience!! Walmart never fails to grant the perfect Black Friday shopping. Love getting out with the people and crowds that Walmart always packs in!!!”

“Less crowds, less dirty people in pajamas, nicer employees, more open check out lanes, and stop piling items in the middle of aisles!!! Two grocery carts going in opposite directions can’t get through. Wal-Mart always puts me in a god awful mood.”

“Not handing out tickets 3 hours before sale and then people can leave and come back…people should stand in line and wait their turns.”

PRODUCT AVAILABILITY:

“Having more on my list in stock. Didn’t match what I saw online.”

“If they had the grills that were on sale in stock. One hour in stock was a lie!”

“If they hadn’t begun their Black Friday sales on Thanksgiving day”

“If I physically left with iPad vs having it shipped.”

POSITIVE COMMENTS:

“Nothing. This was the most organized Black Friday sale I have ever attended. The lines were enforced and sales associates were knowledgeable.”

“Nothing. A worker even helped me out during Black Friday madness.”

“This trip was good because of the bracelet bands they issued to prevent the madness of Black Friday shoppers. Thank you!”

 

Why Back-to-School Shopping Is A Royal Pain

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As a retail market researcher, I was excited by the opportunity my wife recently presented me:  “Would you like to take care of the kids’ school supply shopping?”  I jumped at the chance to conduct an experiment while wearing both “parent” and “researcher” hats.

I first prepared by combining three kids’ school supply lists into one master shopping list, and then crafted my strategy: I would cherry-pick items on-sale at CVS, then move on to Walmart for everything else.

At CVS, I found my first pitfall: in an attempt to rack up $3 in Extra Bucks, I spent over $10 on Crayola products. What felt like a good deal at the time was still overspending compared to the ‘everyday low prices’ I found on the same products at Walmart.

Shopping at Walmart presented its own disappointments: the aisles were cluttered, disorganized and picked-over, looking like a tornado had just whipped through. I did the best I could, but simply couldn’t find one-quarter of the items I needed – especially particular types of binders and folders.  After my wife’s visits to Target and Office Depot still left our list unfulfilled (‘multicultural crayons’ anyone?), we agreed that next year, we’ll be doing our back-to-school shopping online.

After such a disappointing experience, I decided to ask some questions of our Shoparoopanelists (who donate shopping receipts to their children’s schools) to find out if I was alone in my frustration.  With 5,438 responses to 15 questions triggered by the purchase of school supplies, it appears that our experience may actually be the norm.

Like myself, 78 percent of parents begin their school supply shopping armed with lists (although only 18 percent created them via mobile apps). For 69% of the shopping trips studied, school supplies had been the primary purpose of the shopping trip and the reason that particular store had been selected. Yet only 14% of parents were able to complete their back-to-school supply shopping in a single trip.  Worse yet, over 50% of parents anticipated taking three or more shopping trips to fulfill their lists.

Why are brick-and-mortar retailers failing to capture the business of parents with such laser-focused intent, and itemized lists of what they need?   Not carrying the desired items, not carrying enough of them, along with failures in keeping the shelves replenished and organized are among the primary reasons.   And when asked the open-ended question, “What would have made your school supply shopping better?” parents rattled off areas for improvement ranging from the logical, “Better organized aisles,” “More cashiers,” and “More items in stock,” to the wishful: “Free supplies,” “My son’s cooperation!” or, “Doing it kid-free.”

Although 64 percent of parents did zero online shopping for school supplies this year, I suspect that we’ll see significantly more online activity next year – especially as pre-bundled back-to-school kits catch on.  If I were a retailer, I would be focused on experiences and incentives that make my stores the one-stop-shop for back-to-school.  Partnering with schools and teachers to make sure items on their supply lists are stocked, increasing staff during peak season to keep the shelves tidy & replenished, and creating more bundled kits would be a start.

If you’re interested in learning more about this study and the purchasing data behind it,drop us a line; we’d be happy to share our findings with you!

 

Shopper Insights In Action

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I just attended the Shopper Insights in Action conference in Chicago and thought I’d share a few takeaways from what was one of the best conferences I’ve been to in a long time.

My single biggest observation from the event was how much practitioners in the retail market research industry rely on surveys.  I had heard that 80% of all market research data was generated from surveys, but after attending all the presentations at this conference, one could easily conclude that the actual percentage could be much higher.   But what really amazed me is the fact that brands still need to question shoppers about where they shop, when they shop, and what they buy.  Shouldn’t brands already have that purchase data to facilitate more targeted and insightful survey questions about WHYthose particular purchases were made?

More than one of the conference’s presenters highlighted the need for a next generation of intercept surveys.  In particular, they noted the benefits of leveraging mobile technology to lower the costs of reaching hyper-targeted respondents in more locations with the added benefit of knowing the respondents’ longitudinal behaviors.  At InfoScout, we couldn’t agree more!  New approaches like this will only improve our collective ability to generate truly actionable insights.

Take new product launches for example.  What’s the best way to quickly & efficiently survey people who just bought your new item?   Today’s approaches involve asking tens-of-thousands of professional panelists whether or not they’ve recently bought the item, or by asking thousands of random shoppers the same question as they exit specific stores.   Neither approach is efficient, nor do they offer the benefit of knowing how the respondents previously shopped the new item’s category.  Moreover, there’s almost no ability to measure respondents’ repeat purchase activity thereafter.

By comparison, consider InfoScout’s approach.  We track every purchase made by tens-of-thousands of consumers on an ongoing basis.  This allows us to trigger surveys immediately to people who not only meet certain demographic & psychographic profiles, but who have also purchased a particular product in a particular store.  With full knowledge of their actual shopping activity, more insightful questions can be asked to understand the ‘why behind the buy’.

If you are ready for a new & better approach, let us know.  We’d love to show what we’re capable of!

The Usual Suspects

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One of my all-time favorite movies is The Usual Suspects starring Kevin Spacey.   In the movie, his character turns out to be the mastermind behind a magnificent heist, yet the investigators let him go because they mistakenly assumed that he simply couldn’t be the culprit.

But it’s not just criminal investigators who are guilty of assumptive profiling.   The same could be said of brand marketers who, in the absence of data, tend to assume that the mom is the shopper and decision maker they must market to – particularly when it comes to grocery purchases.   However, recent data suggest that men play an ever-increasing role in grocery-related purchasing decisions.

Moreover, today’s brand marketer turned investigator is often left with gross assumptions as to the motives of shoppers and consumers alike.  At best, brands rely on focus groups and opinion panels in rough attempts to understand the nature and motives of their would-be consumers.  At worst, the job is left to intuition and rules-of-thumb as a natural response to the high costs, long latency and overall inadequacy of the tools of the market research trade.

Just as fingerprinting and DNA technologies revolutionized forensics, traditional market research tools will rapidly be swept aside by a new set of technologies that leverage the ubiquitous signals of a marketing landscape that is increasingly digital, social & mobile.  These new tools will fundamentally change market research – NOT by simply providing better measures of ‘what’ happened, but by explaining ‘why’ it happened.

At InfoScout, our motive is clear: to explain ‘why’ behind the ‘buy’.  If we’re successful, we’ll be guilty of making brands better marketers – a charge we’ll gladly accept.