[Report] Multiple vs Symbol Group Retailing: Cost vs Convenience - Ireland

Introduction
Bye bye independent grocer
New challenges ahead
Our aim
Definitions
Geographical, national and regional definitions
Insights and Opportunities
Stores within stores
Dedicated service staff
Symbol Internet shopping
Symbol own labels
Market in Brief
Most shopping is bought from Multiples
Tesco dominates
Convenient location is the most important store feature to consumers
Why shop in a multiple or a symbol?
Multiples perform proportionately better in NI
Distinct target groups emerge
What happens next?
Internal Market Environment
How symbols compete with multiples' product offerings
Buying power of multiples allows for drawing the masses...
...but symbols try to replicate this effect...
...though key issues still hinder their competitiveness...
Farmers Markets, local and artisan producers grow in numbers and popularity...
...but innovative symbols can benefit from the trend...
...but may not necessarily build competitive advantage over multiples
Foreign influences and new tastes...
... which multiples can take better advantage of...
... but symbols are not entirely excluded
Convenience is key for younger consumers
... which means symbols locations compete with multiples products
Deli counters offer success...
... for those that keep pace with changes...
... and offer diverse selection...
... with more offerings in the pipeline
Deregulation makes for more aggressive competition
Abolition of groceries order...
... benefits the consumer...
... but leads to controversy surrounding alcohol promotion...
... and causes worry among small retailers and symbols...
- Figure 1: Consumer price index for all items and for food, RoI, 2001-06
...and leads to more aggressive competition among the multiples
Shoppers more willing to travel
- Figure 2: Distance travelled to shop, NI & RoI, 2002-06
NI Consumers are more prepared to travel to shop...
...while RoI consumers increase focus on convenience
- Figure 3: Transport used by type, NI & RoI, 2006
Transport issues accentuate these trends
Multiples keep Internet shopping to themselves...
... but factors inhibit this feature
- Figure 4: Agreement to selected statements, NI & RoI, 2002-06
Rising costs remain a prominent issue for retailers
Wages are on the rise...
... while oil drives the largest cost increases...
... but the property market does not deter investment...
... and the small symbols will ultimately suffer
Environmental and planning issues affect retailers' strategies
Plastic bag levy has positive and negative effects...
... primarily affecting symbols...
... but may result in further initiatives...
... as government and consumers become more environmentally conscious...
... and may influence the future in NI
Many multiples and larger symbols are classified as major producers of packaging waste...
... but have reduced their obligations by joining Repak...
... while smaller symbols have lesser obligations
Waste and Resources Action Programme has impact on UK and NI
Planning restricts retail development...
... which helps maintain symbols' position
Product safety and packaging is paramount for retailers
Consumer confidence shaken by bird flu...
... but RoI market is recovering...
... while NI market is slower to recover...
... and effects are passed on to retailers
... as consumers look at their options
Food legislation is a key issue for the food industry...
... and for multiples and symbols...
... but retailers can use it to their advantage...
... though caution is still required
FSA has limited success with signposting in the UK
... but no uniform approach may lead to confusion
Broader Market Environment
Demographic make-up is changing
NI population is aging, while numbers of minors fall
- Figure 5: Population change by age group, NI, 2000-20
RoI population changes will have less severe impacts
- Figure 6: Population change by age group, RoI, 2000-20
Positive net migration drives RoI population growth
- Figure 7: RoI residents by nationality, 2006
... which has varying impacts for retailers
... opening opportunities for new products...
... and new labour...
... but it is business as usual for NI
Dublin maintains the majority of the population...
- Figure 8: Populations of major cities, counties and satellite towns in RoI, 2002-06
...But may not be the future focus
NI statistics reflect similar trends, to a lesser extent
- Figure 9: Population of major administrative areas in NI, 2005
Household size
- Figure 10: Change in household size for RoI and NI, 1999-2005
The economic climate presents further opportunity for retailers
- Figure 11: Health of the economy, NI and RoI, 2005-07
Market Size and Share
- Figure 12: Market share of multiples, symbols and hard discounters, NI and RoI, 2006
- Figure 13: Market share for major multiples and symbols in the RoI, 2006
- Figure 14: Market share for major multiples and symbols in NI, 2006
Retailer Profiles and Developments
Multiples
- Figure 15: Multiples outlet numbers in RoI and NI, 2007
Aldi
Asda
NI Co-op
Dunnes Stores
Iceland
Marks & Spencer
Sainsbury' s
Lidl
Superquinn
Tesco
Symbols
- Figure 16: Retailer outlet numbers and outlet types, NI and RoI 2007
AMD Londis
Costcutter
Gala Group
Hendersons
Mace Group
Musgrave SuperValu-Centra (MSVC) Group
Spar
Other market participants and new market entrants
Consumer Shopping Trends
- Figure 17: Where consumers most shop by type of retailer, 2006
- Figure 18: Where consumers ever shop and shop most often, NI and RoI, 2006
Tesco leads the way in RoI...
...And even more so in NI
Symbols and hard discounters benefit from supplementary shopping
M&S draws a significant amount of customers for supplementary shopping
Consumer Attitudes
- Figure 19: Importance of retailer features selected by percentage of consumers
- Figure 20: Top selected features by RoI multiples' customers
Aldi' s customers quench doubts as to hard discounters' quality
Price focused consumers choose Tesco over Dunnes
Brand conscious consumers flock to Dunnes
- Figure 21: Top selected features by RoI symbols' customers, 2007
Time poor consumers look to the symbols
Quality to be found in symbols...
... but at what price
Supervalu caters for the masses
Opportunities and implications
- Figure 22: Top selected features by NI multiples' customers, 2007
Asda customers focus on price but Sainsbury' s has the edge on quality
Lidl and Iceland battle for the price sensitive consumer
Dunnes offers range and service
M&S proves its quality
- Figure 23: Top selected features by NI symbols' customers, 2007
Convenience of symbols drives them forward
Do smaller shops mean better service?
Opportunities and Implications
Consumer Cluster Analysis
- Figure 24: Consumer clusters, ni and RoI, 2007
RoI clusters
Price Sensitive -- 21%
- Figure 25: Key features of the Price Sensitive cluster, 2007
Opportunities and implications
Indifferent -- 28%
- Figure 26: Key features of the Indifferent cluster, 2007
Opportunities and implications
Quality Focused -- 22%
- Figure 27: Key features of the Quality Focused cluster, 2007
Opportunities and implications
Broad Spectrum -- 15%
- Figure 28: Key features of the Broad Spectrum cluster, 2007
Opportunities and implications
Fast Paced -- 14%
- Figure 29: Key features of the Fast Paced cluster, 2007
Opportunities and implications
NI clusters
Product Focused -- 15%
- Figure 30: Key features of the Product Focused cluster, 2007
Opportunities and implications
High Agenda -- 21%
- Figure 31: Key features of the High Agenda cluster, 2007
Opportunities and implications
Cost Conscious -- 20%
- Figure 32: Key features of the Cost Conscious cluster, 2007
Opportunities and implications
Care Free -- 25%
- Figure 33: Key features of the Care Free cluster, 2007
Opportunities and implications
Service orientated -- 19%
- Figure 34: Key features of the Service Orientated cluster, 2007
Opportunities and implications
The Future
Multiples and symbols face competition from outside the food retailing sector...
...but there is still potential to pose threats to each other
Outlook for competition between multiples
Time saving initiatives
Growth in high end food
Development of ethnic markets
Appendix
Conversion Factors
Exchange rate
Population 2005
BMRB Target Group Index (TGI) sample sizes
Abbreviations
Notes on life expectancy forecasting
Multiple and symbol market worth €13 billion
- Figure 35: Market size for multiples and symbols in Ireland, 2000-06 at current market prices
- Figure 36: Market size for multiples and symbols in RoI, 2000-06
- Figure 37: Market size for multiples and symbols in NI, 2000-06 at current market prices
- Figure 38: Where consumers shop most, multiples, by demographic groups, RoI, 2007
- Figure 39: Where consumers shop most, symbols, by demographic groups, 2007
- Figure 40: Where consumers shop most, multiples, by demographic groups, NI, 2007
- Figure 41: Where consumers shop most, multiples, by demographic groups, NI 2007
- Figure 42: Where consumers shop most, symbols, by demographic groups, NI 2007
- Figure 43: Where consumers shop most, symbols, by demographic groups, NI, 2007
- Figure 44: Retailer features selected by Aldi customers, RoI, 2007
- Figure 45: Retailer features selected by Dunnes Stores customers, RoI, 2007
- Figure 46: Retailer features selected by Lidl customers, RoI, 2007
- Figure 47: Retailer features selected by Superquinn customers, RoI, 2007
- Figure 48: Retailer features selected by Tesco customers, RoI, 2007
- Figure 49: Retailer features selected by Centra customers, RoI, 2007
- Figure 50: Retailer features selected by Londis customers, RoI, 2007
- Figure 51: Retailer features selected by Spar customers, RoI, 2007
- Figure 52: Retailer features selected by Supervalu customers, RoI, 2007
- Figure 53: Retailer features selected by Asda customers, NI, 2007
- Figure 54: Retailer features selected by Dunnes Stores customers, NI, 2007
- Figure 55: Retailer features selected by Iceland customers, NI, 2007
- Figure 56: Retailer features selected by Lidl customers, NI, 2007
- Figure 57: Retailer features selected by M&S customers, NI, 2007
- Figure 58: Retailer features selected by Sainsbury' s customers, NI, 2007
- Figure 59: Retailer features selected by Tesco customers, NI, 2007
- Figure 60: Retailer features selected by Centra customers, NI, 2007
- Figure 61: Retailer features selected by Co-op customers, NI, 2007
- Figure 62: Retailer features selected by Costcutter customers, NI, 2007
- Figure 63: Retailer features selected by Mace/Nearbuy customers, NI, 2007
- Figure 64: Retailer features selected by Spar customers, NI, 2007
- Figure 65: Retailer features selected by Supervalu customers, NI, 2007
- Figure 66: Agreement with convenient location by demographic group, NI and RoI, 2007
- Figure 67: Agreement with convenient location by area, NI and RoI, 2007
- Figure 68: Agreement with good parking facilities by demographic groups, NI and RoI, 2007
- Figure 69: Agreement with good customer service by demographc group, NI and RoI, 2007
- Figure 70: Choice of less crowded feature by demographic group, NI and RoI, 2007
- Figure 71: Choice of 24 hour shopping feature by demographic groups, NI and RoI, 2007
- Figure 72: Choice of home delivery feature by demograhic group, NI and RoI, 2007
- Figure 73: Choice of is the cheapest feature by demographic group, NI and RoI, 2007
- Figure 74: Choice of loyality points scheme by demographc group, NI and RoI, 2007
- Figure 75: Choice of regular promotions feature by regular promotions, NI and RoI, 2007
- Figure 76: Choice of quality of food feature by demographic group, NI and RoI, 2007
- Figure 77: Choice of range of food feature by demographic group, NI and RoI, 2007
- Figure 78: Choice of stock levels feature by demographic group, NI and RoI, 2007
- Figure 79: Choice of well known brands feature by demographic group, NI and RoI, 2007
- Figure 80: Choice of good selection of own label products feature by demographic group, NI and RoI, 2007
- Figure 81: Choice of good selection of healthy eating/low fat foods by demographic groups, NI and RoI, 2007
- Figure 82: Choice of selection of non-food items by demographic group, NI and RoI, 2007
- Figure 83: Demographic make-up of RoI clusters, N RoI, 2007
- Figure 84: Demographic make-up of NI clusters, NI, 2007

Multiple vs Symbol Group Retailing: Cost vs Convenience - Ireland - June 2007

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