Food is something that is bought on a regular basis by consumers. Each shopping trip is an opportunity to present a mix of products to the consumer.
Target and Walmart have a goal to increase visit frequency per year . Another way of stating this is they want there to be fewer days between visits. It’s a lot easier to close a sale with a customer when they are in your store and already making purchases.
The statement below from the CEO of Target is a good example of what many retailers selling food are trying to do.
"We continue to invest in our food offering in recognition of its importance in driving greater frequency, increasing guest loyalty, and making Target a preferred shopping destination," company CEO Gregg Steinhafel
Frequency is driven by having more items that people frequently purchase. Food and consumer products are excellent examples of items bought frequently. Selling these items at attractive prices gets consumers in the door where higher margin and dollar profit items an be presented to the shopper.
Loyalty is the trust that a retailer earns and maintains with consumers. What is the value proposition and does the retailer consistently deliver on its promise? Retailers that do, build trust and are chosen over competition if their proposition is more compelling than competitors.
Preferred is where there are two or more equally compelling choices and the consumer constantly chooses one retailer over another. There are many different factors that drive being preferred. These factors can shift very rapidly. For a time, style and value pricing was a powerful consumer preference that resonated with shoppers and drove them to Target. At some point, shoppers shifted their preferences to low price. It is in this instance, where the impression of “Every Day Low Prices” drove consumers to shift their buying behavior and choose Walmart.
What will be interesting is to see if there are other preferences that retailers and merchants can deliver a compelling message to consumers. Those that are able to effectively do so will see increasing visit frequency, loyalty and consumer preferences.
What are your thoughts on consumer preferences?