To view this email
as a web page, click here.
Welcome
to the ShopperScape™
Newsletter August 2007
- Expect department stores will continue to make headway at the expense of adult apparel specialty stores.
- Anticipate creative traffic draws from the home improvement channel to counter the effects of the shaky housing market.
- Expect gasoline pressures to continue to affect Down Market shoppers in particular.
- Anticipate that more affluent shoppers have already shifted their shopping behaviors as much as they intend to as a result of rising gas prices.
- Look for discount department stores/supercenters to scramble this season to get their fair shares of the back-to-school (BTS) business.
- Continue to promote during BTS to offset shoppers’ future intentions to spend less this season than last.
Department Stores and Discount Department Stores/Supercenters Attracting Shoppers
TNS Retail Forward’s July ShopperScape™ survey findings continue to underscore that more shoppers are turning to department stores to meet their apparel needs at the expense of apparel specialty stores (Figure 1):
- Both department stores and discount department stores/supercenters increased their year-to-year shopper shares by healthy percentage points—8 and 6 percentage points respectively. At 86%, the discount department store/supercenter channel has penetrated the shopper market about as much as feasible.
- Consumer electronics retailers continue to welcome more customers—including online customers—with a 4 percentage point Y-T-Y increase in shoppers visiting the channel.
- Despite the shaky foundations of today’s housing market, home improvement centers/hardware stores were able to increase their YTY shopper shares by 3 percentage points while home textile/home furnishings retailers eked out a 1 percentage point gain.
- Once again in negative territory is the adult apparel specialty store channel with a 2 percentage point decrease in year-to-year shopper share.
Figure
1
Percentage of Primary Shoppers Shopping Line of Trade in the Past 4 Weeks
|
All Primary Shoppers |
|
July, 2006 |
July, 2007 |
Y-T-Y
Percentage
Point
Difference |
Department Stores |
48% |
56% |
+8 |
Discount Stores/Supercenters |
80% |
86% |
+6 |
Consumer Electronics Stores |
29% |
33% |
+4 |
Home Improvement Centers/Hardware Stores |
54% |
57% |
+3 |
Home Textiles/Home Furnishings Stores |
28% |
29% |
+1 |
Adult Apparel Specialty Stores |
47% |
45% |
-2 |
As of January 2007, past four week shoppers are defined by shoppers selecting retailers from lists that organize retailers by channel. Previously, shoppers initially selected retailers they shopped during the past six months. Shoppers’ responses to this past six month question defined the list of retailers from which they selected the retailers they shopped during the past four weeks. ShopperScape™ data is balanced to key demographics, which from January 2007 forward include race and ethnicity
Source: TNS Retail Forward ShopperScape™ |
Gas Pressures Becoming Routine for Some
Current shopping behaviors as a result of high gasoline prices have moderated compared with shoppers’ reactions in May 2006. Today, 55% of shoppers indicate spending less as a result of the increase in gas prices vs. 64% last year (Figure 2a).
- Wal-Mart’s latest advertising campaign focused on helping its gas-pressured customers save money by shopping at Wal-Mart however still speaks to its Down and Middle Market customer bases. The majority of these households—especially Down Market households—report spending less as a result of high gas prices (Figure 2b).
- In contrast, the majority of Up Market households are not changing their spending as a result of high gas prices.
Figure
2a
How has the increase in gas prices affected your overall spending?
|
All Shoppers |
|
May 2006 |
July 2007 |
I am spending much less due to the increase in gas prices |
29% |
21% |
I am spending somewhat less due to the increase in gas prices |
35% |
34% |
My spending has not changed due to the increase in gas prices |
36% |
45% |
Average gas price nationally |
$2.84 |
$2.94 |
| Sources: TNS Retail Forward ShopperScape™ and U.S. Department of Energy |
Figure
2b
How has the increase in gas prices affected your overall spending?
|
July 2007 |
|
All
Shoppers |
Down
Market
(< $22,500) |
Middle Market
($22,500 to $84,999) |
Up
Market
($85,000+) |
I am spending much less due to the increase in gas prices |
21% |
30% |
21% |
10% |
I am spending somewhat less due to the increase in gas prices |
34% |
31% |
37% |
31% |
My spending has not changed due to the increase in gas prices |
45% |
39% |
42% |
60% |
| Sources: TNS Retail Forward ShopperScape™ and U.S. Department of Energy |
BTS Spending So Far Comparable to Last Year but Easing Likely
TNS Retail Forward’s July ShopperScape™ questions about back-to-school (BTS) shopping to date and plans for the rest of the season suggest a potential pull back from last year’s spending.
- More BTS spenders in 2007 are planning to spend about the same amount and fewer are planning to spend much more/somewhat more than last year (Figure 3).
Figure 3
Plans to Spend on Back-to-School Relative to Last Year
|
2006 |
2007 |
Much More/Somewhat More |
37% |
32% |
About the same |
48% |
53% |
Somewhat Less/Much Less |
13% |
13% |
This is the first year I will be making back-to-school purchases |
3% |
3% |
| Sources: TNS Retail Forward ShopperScape™ |
Comparisons between the same time periods in 2006 and 2007 show 2007 BTS-to-date spending comparable with 2006. But fewer households plan to spend during the rest of the season and estimated future spending is expected to be down vs. last year (Figure 4).
- So far, about the same percentage of shoppers have bought BTS items this year (15%) as last year (16%) and that 15% spent an average of $365 on those items. This amount represents about 28% of total estimated spending by BTS shoppers to date.
- However, only 31% of primary shoppers in households intend to spend on BTS items during the rest of the season—down from 35% last year at this time. And, average estimated future spending by BTS shoppers at $458 also is down from last year’s comparable estimate of $492.
- A more cautious outlook by shoppers on future BTS spending decreases the total for BTS shoppers from $596 to $578.
- That said, what shoppers do in the recent past is often just as predictive as what similar shoppers will do in the near future. Not yet at mid-term, the final grade on this year’s BTS spending season hasn’t been earned.
Figure 4
Comparisons between BTS Estimated Spending 2006 and 2007
|
2006 |
2007 |
Percentage of households spending on BTS by third week in July |
16% |
15% |
Average estimated BTS spending by third week in July by BTS shoppers |
$366 |
$365 |
Estimated percentage of spending to date |
26% |
28% |
Percentage of households planning to spend during rest of BTS season |
35% |
31% |
Average estimated spending during rest of BTS season by BTS shoppers |
$492 |
$458 |
Average estimated total BTS spending by BTS shoppers |
$596 |
$578 |
| Sources: TNS Retail Forward ShopperScape™ |
The distribution of estimated total spending on BTS by category suggests an area where spending may be weaker than last year—computers (Figure 5).
- With the exception of computers, the percentages of estimated spending for all other categories is equivalent to last year with clothing and related items commanding one-third of BTS spending.
- Books and computers account for 13% of spending apiece, closely followed by shoes at 12% and school supplies at 11%.
Figure 5
Estimated Spending by Back-to-School Category
BTS Category |
Percentage
of total
estimated
spending
2006 |
Percentage
of total
estimated
spending
2007 |
Y-T-Y
Percentage
Point
Difference |
Clothing |
33% |
34% |
+1 |
Books |
12% |
13% |
+1 |
Computers |
16% |
13% |
-3 |
Shoes |
12% |
12% |
0 |
School supplies |
10% |
11% |
+1 |
Backpacks/school bags |
4% |
4% |
0 |
Other electronics |
3% |
3% |
0 |
Dormitory furnishings/bedding/bath |
3% |
3% |
0 |
Computer software |
2% |
2% |
0 |
Other |
4% |
4% |
0 |
| Sources: TNS Retail Forward ShopperScape™ |
BTS shoppers who are buying apparel plan to spend in the same places as they did last year (Figure 6). But most venues and major retailers are mentioned by slightly fewer BTS shoppers this year than last, suggesting less shopping around than last year.
Figure 6
Store Types Where Bought or Plan to Buy Back-to-School Clothing or Shoes
|
2006 |
2007 |
Children's apparel specialty stores (e.g., Children's Place, Gymboree, GapKids, Limited Too) |
20% |
16% |
Teen apparel specialty stores (e.g., American Eagle Outfitters, Abercrombie & Fitch, Hot Topic, PacSun, Wet Seal, Aeropostale) |
19% |
18% |
Adult apparel specialty stores (e.g., Old Navy, Gap, Banana Republic, J. Crew) |
25% |
22% |
Off-price apparel specialty stores (e.g., TJ Maxx, Ross Dress For Less, Marshalls, Dress Barn) |
22% |
20% |
Factory outlet apparel stores |
15% |
13% |
Target |
45% |
43% |
Wal-Mart or Wal-Mart Supercenter |
55% |
53% |
Discount store other than Target or Wal-Mart |
11% |
11% |
JCPenney/ Kohl's/ Sears/Mervyn's |
44% |
40% |
Traditional department stores (e.g., Macy's, Dillard) |
13% |
12% |
Famous Footwear |
12% |
10% |
Payless ShoeSource |
29% |
28% |
Shoe retailer other than Famous Footwear or Payless ShoeSource |
20% |
22% |
Other store type |
12% |
11% |
| Sources: TNS Retail Forward ShopperScape™ |
Industry Outlook: Mass Channel
The mass channel sales growth forecast for the next five years has been revised downward due to a slowdown in Wal-Mart’s expansion plans. But the channel’s sales growth outlook, especially for the supercenter sector, remains solid vis-à-vis many other retail channels. Leading mass players are actively fine-tuning their strategies by adjusting assortments, adding new brands and launching innovative initiatives, e.g., GO International at Target and Wal-Mart’s $4 generic kickoff. But they’re also finding it increasingly difficult to generate same-store sales gains off of big maturing store bases. Anticipate mass retailers to look for growth beyond the conventional box—new formats, international expansion, service offers and online initiatives could provide opportunities.
Jennifer Halterman, Senior Consultant, TNS Retail Forward
For more information on “Industry Outlook: Mass Channel” and the TNS Retail Forward Intelligence System™ call Kathy Clarke at 614-355-4009 or email her at kclarke@retailforward.com.
| What's
TNS Retail Forward ShopperScape™?
TNS Retail
Forward ShopperScape™ focuses on today's consumers and their shopping behaviors.
TNS Retail Forward ShopperScape™ has been fielded since November 2003 to a sample
of 4,000 consumers each month. The survey gathers timely, up-to-date information
about where consumers shop and what they buy. TNS Retail Forward ShopperScape™
is administered through TNS/NFO's online household panel, weighted based to be
representative of U.S. households. For more information, call Kathy Clarke at
614-355-4009 or visit http://www.retailforward.com/retailintel/ss_default.asp.
|
|
