Shoppers are drawn to smaller, closer stores

HYPERMARKETS and supermarkets appear to be losing out because Filipinos looking to buy staples such as packaged food, toiletries and other consumables are choosing to go to smaller, closer stores in an effort to cut costs, the local unit of data analytics firm Kantar said.

In an online presentation, Kantar Philippines’ Director of Shopper Insight, Loris Opana, said that in order to adapt to inflationary times, Filipinos are becoming more discerning in their choices when it comes to Fast Moving Consumer Goods (FMCG).

FCMG, also known as consumer packaged goods, are products that sell quickly at a relatively low cost. It has a short shelf life due to high consumer demand or perishability. Goods in this category include beverages such as soft drinks, meat, fresh/frozen vegetables, dairy products, bread and other baked goods, cleaning supplies, and over-the-counter medications such as pain relievers.

“Filipinos place a premium on value. While value can be as straightforward as cheaper goods or paying less for the same amount, other factors such as increases in gas prices, traffic and inconvenient modes of transportation have redefined value in more inclusive terms when Opana said.

For packaged goods in general, shoppers were said to cope with higher prices by being more open to value brands. To some extent, they also take into account where to shop.

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Supermarkets, which combine the experience of a supermarket with a department store, and hypermarkets were said to be under some pressure because most Filipinos feeling economic pressure buy their consumer goods needs from nearby convenience stores.

This year, 41 percent of consumer goods purchases are made in sari-sari neighborhood stores (miscellaneous), up 6 percent from 2020 based on Kantar data. Meanwhile, supermarkets and department stores saw a 6 percent drop in share value to 28 percent from 34 percent over the same period.

“Nowadays, with so many retailers and channel options on hand, customers can easily adapt what fits their budget and lifestyle that meets their needs in the moment,” said Opanna.

“Filipino shoppers are aware of the choices they make when it comes to their channel and retailer of choice. Delivery of value in the form of rewards, low prices or promotions is taken for granted. Convenience or accessibility and availability of options are also important factors that shoppers think about now.”

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