Rather than falling off a cliff, the economy is turning the corner, summarizes "The Why? Behind The Buy" report from Jacksonville-based Acosta Sales & Marketing.
"For the first time in more than a year, total U.S. spending by consumers in the grocery channel was up in the first quarter of 2013," said the Spring 2013 report, released Monday.
Acosta is a full-service sales and marketing agency in the consumer packaged goods industry. It releases a report twice a year about consumer sales trends.
After previous reports about consumers struggling in the economy, this one is called "Turning The Corner."
"Consistent signs of improvement in the U.S. economy have eased concerns about a double-dip recession and raised consumer confidence," it says.
"With gains in the stock market, improvements in the housing market, decreases in unemployment, slowing consumer debt and foreclosure rates, the overall market outlook seems to be improving in a sustainable way," says the report.
Its three recommendations for its customers, who are retailers and consumer packaged goods companies, to boost business as the economy improves are:
• Leverage digital. Shoppers are making major advancements in using technology for grocery shopping. Companies and retailers who want to stay on the leading edge of digital should test and learn from tech-savvy Generation Y and U.S. Hispanic shoppers.
• Make every trip count. After years, the number of shopping trips is stabilizing and even increasing among younger shoppers and U.S. Hispanics. Retailers and companies must "pull out all the stops" and develop fully integrated marketing campaigns and other approaches to help customers.
• Health and wellness education. Shoppers are concerned with health and wellness but need help to create healthy eating plans and to make smart diet choices. Companies and retailers can help shoppers understand their options and generate "consumer loyalty and trust."
Shoppers surveyed reported modest improvements in their personal financial situations. "Finally, concerns about job uncertainty and personal debt burdens are easing," Acosta said.
Acosta reported the Nielsen consumer research company found grocery spending up 1.7 percent in the first quarter, a modest but encouraging increase.
Shoppers continue the thrifty habits they formed during the 2007-09 recession, Acosta found. Club stores, supercenters and dollar stores are seeing more monthly customer trips, compared to 2012, while drug stores, mass merchandisers and grocery stores are seeing fewer.
However, some shoppers generally are making more trips to the stores.
The Gen Y consumers, ages 18-29, the Gen X consumers, ages 30-44, and Hispanic shoppers are making more routine shopping trips, Acosta found.
"Modest improvements include the stabilization of routine shopping trips following years of decline and even some gains in the number of routine trips being reported by younger shoppers and U.S. Hispanics," Acosta reported.
Gen Y consumers are expected to continue to increase their trips as their careers advance, they marry, they have children and they buy homes.
Acosta said the challenge for the consumer packaged goods industry and for retailers is to maximize the experience when those shoppers are in the stores. "This is where brand connections, store experience, meal solutions, integrated promotions and micro-targeting become key drivers" to increase the amount spent on the trips.
Acosta said another sign the economy is improving is that shoppers are buying more in in categories across the store, including coffee creamer, adult yogurt, paper towels, pet food, frozen appetizers, frozen desserts, household cleaning products and packaged side dishes.
Shoppers also are using technology before, during and after grocery shopping. Acosta said that according to a September 2012 Forbes Insights survey, 41 percent of U.S. consumers said they feel engaged or invested in a brand when they sign up for special deals or email updates.
Gen Y and U.S. Hispanic shoppers are two groups on the leading edge "of both digital adoption and the decline of the printed circular," Acosta said.
Asked how often three specific vehicles impacted what consumers buy, shoppers cited a decline in the impact of coupons in newspapers or magazines, in store fliers and in coupons from store fliers.
About 7 in 10 shoppers use Facebook and 45 percent of them visit brand pages at least monthly, primarily for coupons and special offers, Acosta found.
About 8 percent of shoppers buy grocery items online, with the most popular category being health and beauty products.
Shoppers also are using digital coupons more often. While most print the coupons at home, shoppers also are using mobile coupons. Acosta cited studies that found more than half of U.S. consumers use smartphones and that about half of the 96 million adult consumers using digital coupons will use the mobile variety by the end of this year.
Acosta also reviewed what it calls "the health and wellness paradox."
"Health and wellness is an area of some dichotomy among shoppers," said the report. "While U.S. obesity rates have climbed over the last 10 years and one-third of U.S. adults are considered obese, the majority of shoppers polled reported they exercise regularly and try to eat healthy,"
While almost three-quarters of shoppers indicated they are confident they are choosing healthy food always or most of the time, they tend to search the Internet for information. Most shoppers aren't aware of retailers' programs to rate food products' nutritional values.
Half of shoppers said cost is the main impediment to healthy eating, Acosta said.
The issues provide opportunities for consumer packaged goods companies and retailers to "help shoppers solve the health and wellness puzzle."
Acosta works with more than 1,000 consumer brands in the consumer packaged goods industry, including many of the highest profile products on the store shelves. Acosta has more than 30,000 employees in 65 locations in the U.S. and Canada.
AMG Strategic Advisors, which conducted the survey, is Acosta's growth strategy consulting unit. It provides consulting, brand positioning, shopper and market insights.
For more information, visit Acosta.com
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