Consumers Identify More With Value, Less With Specific Retailers

Consumers Identify More With Value, Less With Specific Retailers

According to the latest Retail Ratings Report from BIGresearch, when purchasing electronics, an increasing number of consumers are less concerned about where they shop than they are with finding value. In the September 2003 Retail Ratings Report, consumers were asked "where do you shop most often for electronics?" Of those surveyed, 22.2 percent said they had "no preference." That number is up from 13.7 percent in Sept. 2002.

"The products in this category are very much the same between the retailers," said Gary Drenik, CEO of BIGresearch. "Consumers seem to be opening their Sunday circulars and picking the retailer with the best deals, not worrying about which retailer that might be."

One aspect of that report is BIGresearch's Consumer Equity Index, which measures a retailer's growth or decline in Consumer Preference Share on a year over year basis. To calculate a retailer's CEI, the current year's Consumer Preference Share is divided by the previous year's.

Consumers surveyed chose Best Buy, Wal-Mart and Circuit City as their top three electronics retailers, with 25.9, 19.1 and 8.7 percent respectively saying they shop most often there. On the flip side, those same three retailers lost the most consumer equity from Sept. 2002 to Sept. 2003. Circuit City's CEI fell 1 point for an index of 89.69 while Wal-Mart dropped 1.2 points to an index of 93.91. Best Buy's index was 94.45, down 1.5 points from September 2002.

In the women's clothing segment, all consumers surveyed said they shopped most often at Wal-Mart, JC Penney and Kohl's, while the overall 18+ Consumer Equity Index fell for both Wal-Mart and JC Penney.

"We're seeing the same thing here as we are in the electronics category," Drenik said. "In the competitive zero-sum retail environment, when someone grows it's usually at the expense of a competitor. Tracking the shifting consumer preferences among various retail segments is essential for identifying market changes, which can impact the bottom line of every retailer every quarter."

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