A loyal customer is not equivalent to a satisfied customer

What consumers say is important for their choice of grocery store is not the same as they are happy with the store they usually shop in. This according to Elin Nilsson, Ph. D, Umeå University, in her dissertation Where to shop? Understanding consumers’ choices of grocery stores. Learn which consumer groups you want to attract to your store and you will get both loyal and happy customers.

Consumers choose their food stores depending on the situation they are facing, not on distance or assortment of products. This is in short terms the summary of Elin Nilsson dissertation Where to shop.

Five new consumer segments

Why consumers behave the way they do has been studied over several decades in different disciplines, for various purposes, and with different research models. In this dissertation, the primary focus has been to investigate how various situations help determine choices consumers make of grocery store formats.
The new types of consumer characteristics presented in this thesis are based on where and how people shop:

• The Planning Suburbans do their shopping in supermarkets.
• The Pedestrians do their major shopping in convenience stores.
• The Social Shoppers who make their fill-in-shopping in supermarkets.
• The City Dwellers who make their fill-in-shopping in convenience stores.
• The Flexibles who are doing both major and fill-in-shopping in both convenience stores and supermarkets.

Major shopping vs. fill-in shopping?

The dissertation is based on several surveys that asked thousands of respondents in Sweden about their shopping habits and shopping influences. The results show that since consumers are reluctant to switch stores from their regular one to a new one, many consumers act in a way that the shops are not designed for. Some do their major shopping in convenience stores, and others do their fill-in-shopping in supermarkets. That means that consumers differ in what they value, and different attributes become important for different customers. The customers stay loyal to a store even though their needs would be better met in another store.
“Consumers’ cognitive proximity is much more important than the physical place of the store,” Elin Nilsson says. “In other words, consumers’ habits and their knowledge of where to find what they need in a store triumph over closeness to store.”
Due to the increased competition the grocery retail sector faces with online shopping, home delivery, and different food boxes; it becomes even more important to know the consumers to stay attractive.

Define your customer-segment

Elin Nilsson emphasises that grocery stores need to manage different store attributes depending on which consumer groups they want to attract and what situation the consumers are facing.

“Retailers must decide what kind of consumers they have or want to have and then design their store instead of only focus on what type of store they have,” she says.

Also, if retail managers gain knowledge about their consumers and the consumers they are striving to have, marketing managers could then highlight these store attributes in marketing to attract the targeted consumer group.

She says that in order to reach different consumer groups with marketing, the marketing efforts and offerings should be situation-based instead of based on consumer characteristics. This would attract the consumers in a better way, Elin Nilsson says.

“For example: if the store wants to attract City Dwellers (fill-in shopping in convenience stores), they could send the customer an offering in the afternoon with suggestions of what to make for dinner that evening. Whereas if the store wants to attract Planning Suburbans (major shopping in supermarkets) they should send offerings for their major weekly shopping trips.”
Read the full dissertation here