Spending patterns

With the huge expense in making major product shifts or in launching new products, manufacturers are increasingly using science rather than gut feel to ensure consumer acceptance.

"Research has become a vital tool in determining the direction of businesses," said ACNielsen Phils. managing director Esther Capistrano. "For example, the data we gather directly from consumer households give manufacturers a whole picture of what products consumers buy and why they buy these."

Based on the company’s data, 54% of Philippine households fall under the D-income bracket while 36.4% fall under the E-income bracket. The broad middle-class or the C-income bracket account for 8% of total households while the A-B brackets have shrank from 1.2% in 1992 to 0.8% in 2002.

"Our research show that consumers are now less brand-loyal than 10 years ago," said consumer panel service director Russel Hidrosolio. "Before, a family will only have one brand or bottle of shampoo. Now, each household member has his/her own different shampoo brand."

Global Survey

The Philippines has recently become part of the consumer panel service of global market research firm, ACNielsen.

Based on the company’s 2002 report, the French continue to have the highest spend per basket (or trip), followed closely by the Swiss. Hong Kong residents have the smallest basket but make up for it by going to the supermarket every 1.4 days.

Filipinos, Italians, and Germans are also frequent shoppers, with the frequency traced to fragmented retail outlets in these countries.

Chileans, South Africans, and Australians are the opposite, with Chileans replenishing every five days on the average.

In the survey, the Philippines and Hong Kong are the only countries which have less than 50% of packaged grocery purchases made through supermarkets, with a greater reliance on other channels like small grocery store or sari-sari stores.

At the end of the spectrum, 96% of all purchases in Australia are made in supermarkets, suggesting a lack of consumer options to buy through other channels.

Implications

In the Philippines, which has a high frequency shoppers’ base, the implications for retailers and manufacturers are clear.

"Promotional gimmicks work well. Retail strategies in the form of samples should be considered.This is because consumers have more opportunities to evaluate prices and to get the most out of their money with the promotions. There is also more opportunities for impulse purchases since consumers usually do not have grocery lists to follow. Thus, retail promotions work well for the frequent shoppers," said Hidrosolio.

For manufacturers, the frequent shopping pattern of Filipino provides more opportunities to reach consumers.

"Frequent shoppers are more likely to make brand decisions in stores. There is an increased competition at brand level on the shelf," said Hidrosolio.