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Precima Survey Reveals Overwhelming Number of Consumers Didn’t Use Economic Stimulus Checks to Purchase Groceries

U.S. consumers ignoring inflationary pressures; Despite grocers’ efforts, stimulus checks not spent in the supermarket

TORONTO – July 22, 2008 – Despite rising food costs, low consumer confidence and grocers’ mass-marketing push to attract economic stimulus spenders, approximately 84% of U.S. consumers in a nationwide survey said they did not use the check they received from the federal government to purchase groceries.

The survey was sponsored by Precima, a retail analytics firm that translates consumer shopping data into critical market insights. It was conducted during the first half of June by ICOM Information & Communications.

The survey results are based on a sample of 1,948 consumers. Of those, 1,317 said they had received their stimulus checks, and 1,106 said they did not spend the rebate on groceries.

In other key results from the 1,106 respondents who said they did not spend their rebate checks on groceries:

"The grocery industry didn’t convince the American consumer that maximum return on stimulus checks could be achieved right in the supermarket aisles," said Precima General Manager Brian Ross. "The average family of four’s $1,800 rebate equates to about three months of grocery buying, a prime opportunity for stores to influence shopping behavior. The rebate checks were a missed opportunity for grocers as consumers in this economic environment opted to earmark the funds for other uses – paying down debt, spending on necessities like gasoline and utilities or putting into savings."

Precima’s scan of grocery marketing tactics in the second and early-third quarters of 2008 reveal that grocers are primarily trying to mass-market or implement gift card promotions in attempts to attract rebate spenders. "Supermarkets are sitting on a wealth of aggregate inventory, sales and customer data from frequent shopper programs. Instead of limiting their promotions to gift card offers, grocers could have used loyalty data to identify more relevant incentives for shoppers to spend their rebates at the grocery store," added Ross.

Ross offers these tips for grocers to leverage their retail customer data when developing promotional offers:

1) Develop compelling offers. In place of one-size-fits-all promotions, analyze loyalty program data to identify store items that are most important to cash-strapped customers and develop incentives that have the greatest cost-saving appeal.
2) Help consumers during tough economic times. Support consumers’ desire for one-stop shopping and help combat rising fuel costs by providing offers tied to saving gas and to larger basket sizes.
3) Help consumers eat at home. Capitalize on consumers’ desire to save money by eating at home with offers tied to convenience items that replace take-out or restaurant meals.

The Precima survey was completed online between June 5 and June 16, 2008

About Precima
Precima is an advanced analytics firm that translates retail customer data into critical insights to better align marketing, merchandising and operations strategies with shopper needs. Precima helps retailers and manufacturers grow sales, improve profitability and build customer loyalty. As the in-house analytics arm of LoyaltyOne (formerly Alliance Data Loyalty Services) prior to 2008, Precima worked with many of the leading retail partners of the AIR MILES Reward Program over 16 years to help make the program North America’s coalition loyalty marketing leader. Additionally, Precima has worked with numerous customer-focused retailers and manufacturers across North America. Precima is recognized for delivering measurable results tailored to each retailer’s unique needs. For more information visit www.precima.com.

Media Contacts:
Jill McBride
513-231-5115
jill@jzmcbride.com

Will Sikes
513-231-5115
will@jzmcbride.com