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In this Issue
:
Consumers ring in the New
Year with slightly more confidence than they had at the
end of 2004
Fewer consumers ‘fess up to
practicality this month
Consumers start ’05 with high
hopes for U.S. employment
outlook
Well-intentioned consumers
may have resolved to become more conservative with their
finances in ’05, but how many will follow through?
Wal-Mart starts the New Year
off with a bang, still at the top in Women’s and Men’s
Clothing.
After (narrowly) fending off
Wal-Mart’s advances in Shoes during 2004, has Payless
fallen to the AR-based discounting behemoth?
Walgreens may currently have
the lock on the #1 in Prescription Drugs, but is on
shaky ground when it comes to HBC
Good news for
automakers…6-month purchase intentions up this
month
Consumers confirm what we
thought all along…BIGresearch is what’s hot this
month!
 ECONOMY
Consumers ring in the New Year
with slightly more confidence than they had at the end
of 2004…those very confident/confident in
chances for a strong economy up almost a point in
January to 48.8% from 48.1% last month…also down two
points from a year ago (50.8%), but up a strong 12
points from the start of ’03.
With Bush’s
second inauguration this month, how are consumers
dealing with political/national security
issues? It looks like
the President may be off to a good start, as concern is
down from 23.4% last month to 18.4%, the lowest reading
since February ’04.
We told you
so…refer back to
your Nov-04 Briefing and you’ll find that we reported
that a decline in year-over-year practicality meant that
“consumers may be more willing to let loose and
spent this [holiday season].” With the NRF
reporting a 5.7% rise in holiday sales over 2003 (the
strongest holiday growth since 1999), it looks like we
were right AGAIN.
What's going on with consumers this month? In January,
38.2% of consumers 'fessed up to becoming more practical
in the last 6 months, down from 43.6% last month, and
the lowest reading since September ’02.
And, it looks
like deep post-holiday discounting and gift cards
burning holes in consumers’ pockets have more of our
less-practical consumers forgoing needs in favor of
wants this month...those who
value needs over wants in purchasing falls to 44.4% this
month from December’s 51.0%, a new
low.
 PERSONAL/FINANCIAL
Consumers start ’05 with
high hopes for U.S.
employment outlook…those who say there’ll be
“more” layoffs in the next 6 months down over 4 points
from December (31.3%) to 27.0%, “same” increase to 53.2%
(v. 50.3% in December), “fewer” increases to 19.8% (v.
18.5%).
Personal concerns
with becoming laid off also down slightly to 5.3% from
5.8% last month.
Well-intentioned
consumers may have resolved to become more conservative
with their finances in ’05, but how many will follow
through with their resolutions? Planning to “pay
down debt” increases this month to 44.3%, compared to
42.5% last month and 43.9% one year ago. However, while
consumers planning to increase savings is on the rise
(31.7%, compared to last month’s 30.4%, when savings
took a backseat to holiday spending), fewer are making
this a financial priority in ’05 versus the start of ’04
(35.7%).
Further evidence that less-practical consumers
are showing their colors…credit cards may be getting a
workout, as shoppers planning to “pay with cash more
often” hit a new low in ’05, while “decrease overall
spending” also declines this month.
As the
refinancing boom slows, those planning
to refinance their home relatively flat at 2.5% from
2.8% in December and down over a point from last year
(3.6%). And
those consumers with home mortgages…who are they? Compared to the
average consumer, those with a fixed mortgage are
slightly older and also earn higher average yearly
incomes, while those with variable tend to be younger,
but earn higher yearly incomes than average as well as
those with a fixed mortgage.
Investor
confidence in the stock market is up slightly from
December 2004 ...those who would definitely/probably
invest up slightly from 61.8% last month to 63.6%.
Investors planning to buy stocks relatively flat at
13.5% from December's 13.8%, while those planning to
sell down over half a point to 7.2%.
Holiday shopping
deadlines and highly anticipated movies hitting theaters
in December enticed more consumers to open their
wallets...shoppers were
less likely to defer purchases last month in every major
category: apparel, going out to eat, vacation travel,
home improvement projects, entertainment, autos, and
electronics.
 RETAIL
Wal-Mart starts the New
Year off with a bang, as the discounter remains
at the top in Women’s and Men’s Clothing for the month
of January.
In Women’s, Sears flip-flops with merger partner
Kmart to land at #5, while the rest of the Top 5 remains
the same: 1. Wal-Mart, 2. JC Penney, 3. Kohl’s, 4.
Target, 5. Sears.
However in Men’s, Sears is displaced one notch to
#4 (December rank in parenthesis): 1. Wal-Mart (1), 2.
JC Penney (2), 3. Kohl’s (4), 4. Sears (3), 5. (tie)
Kmart (6) & Old Navy (7).
After (narrowly) fending
off Wal-Mart’s advances in Shoes during 2004, has
Payless fallen to the AR-based discounting
behemoth?
For the second consecutive month, Wal-Mart leads
the discount specialty retailer for the store shopped
most often for Shoes (share % in parenthesis):1.
Wal-Mart (16.7%), 2. Payless (15.0%), 3. Kmart (3.3%),
4. Kohl’s (3.1%), 5. JC Penney
(2.5%).
After Wal-Mart jeopardized CVS’s #2
spot in Prescription Drugs for a few months in ’04, has
the drug store chain finally stepped up the
competition? Most likely
thanks in part to its unique “ExtraCare” card program,
CVS has managed to hang on to it’s second position
(10.5% shop there most often), behind Walgreens (12.7%)
but ahead of Wal-Mart (9.1%), Rite Aid (4.4%), and
Eckerd (2.6%).
But it’s not all about frequent shopper
cards…consumers cited location (63.2%) as the #1 reason
to shop a particular store for Prescription Drugs. Insurance coverage
(40.5%), phone-in prescriptions (38.6%), price (36.1%),
and a pharmacist who provides valuable information
(20.2%) follow.
CVS isn’t out of the woods yet
…this month, we’re
taking a deeper look at the Prescription Drug section
through the Consumer Migration Index (CMI), which tracks
those who have immigrated to a store (the new customers
within the past year) against those who have emigrated
(left within the past year) and where a positive rating
(new customers outnumber those who have left) spells net
growth to a retailer. And, with the
store with the most new
customers and the fewest exiting
customers, Wal-Mart proves that prolific locations,
EDLP, and that big yellow smiley face are a winning
combination.
The discounter scores a +7.7 rating, compared to
the +4.2 and +2.4 ratings of its drugstore rivals of
Walgreens and CVS (respectively), while Rite Aid and
Eckerd provide zero competition:
And the Top 3
reasons why consumers took a walk from their former
Prescription Drug store? Inconvenient
location (25.1%), high prices (20.5%), and poor customer
service (13.7%).
Walgreens may
currently have the lock on the #1 in Prescription Drugs,
but this big W’s on shaky ground when it comes to Health
and Beauty Care…this month, CVS
pulled ahead of Walgreens to claim the #2 spot behind
(who else?) Wal-Mart. The complete Top
5 (share % in parenthesis): 1. Wal-Mart (35.1%), 2. CVS
(6.0%), 3. Walgreens (5.7%), 4. Target (5.2%), 5. Rite
Aid (2.5%).
How’d CVS pull it
off?
According to the
Consumer Equity Index, our year-over-year index which
shows growth or decline in a store’s share (an index of
100 is flat, while an index of 105 indicates 5% growth),
this month in HBC Wal-Mart’s growth has flat-lined over
the past year (CEI=99.91), CVS has experienced 12%
growth (CEI=112.36), while Walgreens saw a 12% decline
(CEI=87.93).
Insight
special: Walgreens is particularly losing it’s male
and under $50,000 customers, while CVS has been
capitalizing on men and those earning over $50,000. Check out the chart below for a CEI visual of the
Top 8:
This
info’s pretty clever, huh? This is just a
taste from our monthly Retail Ratings Report, available
for 10 major categories.
And just in case
you were curious
…Wal-Mart still
leads in Groceries this month with 15.7% who say they
shop there most often. Kroger (6.4%),
Albertsons (3.5%), Safeway (3.3%), and Publix (2.9%)
follow.
This just in…New Analysis From
BIGresearch Details Cross Shopping at
Wal-Mart.
Retailers who
don’t think they share their customers
with Wal-Mart just got some bad news, according to a new
analysis of cross shopping patterns by BIGresearch. The
analysis, “When Customers Cross Shop,” was
taken from BIGresearch’s December Consumer Intentions
and Actions survey (CIA) of 7,712
consumers.
Read the
release: www.bigresearch.com/news/big012005.htm
Buy the
report:
http://www.formsite.com/prosper/bigspecialreport
 FEATURED
AISLE
This month, we’re getting a
jump on Spring Cleaning…we’re headed down the Household
Cleaning products aisle. When choosing
the store to shop at most often for these products,
44.0% of consumers prefer discount stores over grocery
stores (24.4%).
And with almost one in three (30.0%) shopping
Wal-Mart most often, this discounter is the solid #1 for
this category…Target follows with 4.1%, while Dollar
General (2.6%), Kroger (2.5%), Costco (2.0%) round out
the Top 5.
However, almost one in five (18.6%) consumers say
they have no store preference, presenting retailers with
a prime opportunity to convert them to purchase within
their stores.
And how much
change are consumers willing to plunk down every month
in order to keep their homes clean? One-quarter
(25.4%) say they spend $6-$10 a month on Household
Cleaning products, 20.2% spend $11-$15, and 16.8% spend
$16-$20.
The average? $15.55 per month.
It looks like
consumers prefer convenient “one-aisle” shopping for
these goods…90.2% expect all Household Cleaning
products to be merchandized together in the store. And when
shoppers have trouble finding the Household Cleaning
products they want to buy, why is that? While 9.6% say
they just “Don’t know,” 10.2% say they can’t find the
right product form, 9.4% complain that the exact product
they want to buy is out of stock, and 8.5% have trouble
finding the type of household cleaner they are looking
for.
 90 DAY
OUTLOOK
Good news for
automakers…6-month purchase intentions up this
month for automotives, compared to December. And with gas
prices on a slight decline, it appears that consumers in
the market for a vehicle are more willing to check out
gas-guzzling SUVs and cross-overs (the car-based SUVs)
than they were last month…cars on a slight decline.
However, it
seems the good news may end there…most major
purchases are off this month (compared to December) as
consumers turn their attention to paying off their
holiday shopping bills. Computers,
furniture, home appliances, jewelry/watch, stereo
equipment, TV, VCR/DVD, and digital camera down…house
and major home improvement/repair down slightly. Vacation travel
is up, as chilled consumers likely looking for warmth
down
south.
It
appears that consumers plan to concentrate on the
insides of their homes during the winter
months, as the 90 Day
Outlook for linens/bedding, home improvement, home
décor, and home furniture up this month, according to
the BIGresearch Diffusion Index (those who say they’ll
spend less subtracted from those who’ll spend
more). For
those in warmer climates, it looks like they’ve focused
on tending to the outdoors as well…lawn & garden is
also up:
Retail Merchandise Categories - 90
Day Outlook
(January 05 compared to December 04
and January 04)
| Category |
December 04 |
January 04 |
Category |
December 04 |
January
04 |
| Children's |
DOWN |
UP |
Toys and
Games |
DOWN |
UP |
| Women's
Dress |
DOWN |
FLAT |
CDs/DVDs/Videos/Books |
DOWN |
DOWN
slightly |
|
Women's
Casual |
DOWN
slightly |
FLAT |
Electronics |
DOWN |
DOWN |
| Men's
Dress |
DOWN |
UP |
Groceries |
DOWN
slightly |
DOWN |
| Men's
Casual |
DOWN |
FLAT |
Home
Improvement |
UP |
DOWN |
| Shoes |
FLAT |
UP |
Lawn
& Garden |
UP |
DOWN |
| HBC |
UP |
FLAT |
Home
Furniture |
UP |
DOWN |
| Dining
Out |
DOWN
slightly |
DOWN |
Decorative Home Furnishings |
UP |
FLAT |
| Sporting
Goods |
UP |
UP |
Linens/Bedding/Draperies |
UP |
UP |
 ON THE LIGHTER
SIDE...WHAT'S HOT
Consumers confirm what we
thought all along…BIGresearch is
what’s hot this month! Video email and
eccentric actor Johnny Depp follow. Depp, although
is 40+, is still making temperatures rise among those
18-34…he’s #2 with this group, behind BIGr. Video email,
Disney character accessories, and Anime round out the
Top 5. BIGr
is also #1 with our 35+ fans…Video email, Disney
characters, Electronic scooters, and Depp also hot-hot-hot
with this crowd.
And, no need to refrigerate Pepsi Holiday
Spice…the limited edition soft drink is keeping pretty
cool on its own.
You've read the
briefing, now read the book!
BIGresearch has teamed with T. Scott Gross
to write When Customers Talk, a book
is based on the insights of 100,000 retail
customers presenting their valuable feedback on service,
pricing, habits, and what they look for in a shopping
experience. When Customers Talk is
available through your
favorite bookstores, or you can check
it out at & order it on the web: www.whencustomerstalk.com.
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BIGresearch, LLC. a Prosper International Company
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