Non-food gaining in popularity in UK

- Last updated on GMT

Related tags: Cent, Wal-mart, Igd

British supermarket chains have traditionally focused primarily on
food products, spurning the hypermarket-style mix of food and
non-food items managed so successfully by their French
counterparts. But all this has changed in recent years, and a new
report suggests that the multiple grocers are rapidly becoming a
one-stop shop for many customers.

Shopper research from food and grocery think tank IGD shows that 11 per cent of British shoppers now go to a supermarket just to buy non-food, a dramatic shift in purchasing patterns brought about in no small part by the acquisition of the Asda chain by US giant Wal-Mart, one of the world's best proponents of the food/non-food mixed format.

Spurred on by Asda's success, market leader Tesco has also embraced the non-food category, rapidly expanding its ranges from the traditional household goods and toiletries to include other items such as electrical goods and clothes. J Sainsbury, too, has gone down the non-food route, though perhaps with less success. Its biggest ever range of non-food items was launched last year but just this week the chain admitted that it was over-stocked with non-food items, showing that jumping on the fast-growing non-food bandwagon still requires some kind of long-term strategy if it is to be a success.

That non-food represents a significant profit opportunity is certainly not in doubt. The IGD survey shows that supermarkets are now the first choice for toiletries and household goods, with items such as washing powder and toilet rolls long regarded as part of the grocery shop: indeed, over three-quarters of shoppers choose to buy these items in the supermarket along with their food.

Almost two-thirds of consumers also buy toiletries in a supermarket, compared to just 22 per cent in specialist chains such as Boots or 6 per cent at discount stores. However when it comes to cosmetics, 38 per cent prefer to buy these in a specialist store such as a pharmacy (compared to 23 per cent in supermarkets), as they are regarded as a treat or luxury purchase, according to the IGD survey.

Supermarkets still have some way to go when it comes to clothes as well, with specialist clothing stores still first choice both when shoppers are buying clothes for themselves (46 per cent) or for children (26 per cent). Supermarkets are the third choice for shoppers buying clothes for themselves (13 per cent) and the second choice (14 per cent) when buying clothes for children.

However, 22 per cent of shoppers said they would use a supermarket for buying everyday homewares like pots and pans and consider that supermarkets provide a good range at affordable prices, compared to department stores which offer more special occasion or premium products.

As for healthcare products, there is quite an even split in terms of where shoppers go, with 43 per cent preferring to go to a specialist and 39 per cent buying them in a supermarket. Talking to shoppers, it is clear that where they go depends on the level of expertise they require, the IGD said. Specialists (for example pharmacies, electrical stores, record shops) tend to be the first choice when the shopper feels they need more expert advice. If advice is not important, price becomes more of a determining factor and the supermarket becomes a viable choice.

When it comes to electrical goods, for example, 60 per cent of shoppers prefer to buy large appliances and 46 per cent small appliances in a specialist (compared to 11 per cent and 26 per cent respectively in a supermarket). Shoppers often consider the range to be better in a specialist, in terms of choice and well-known brands, and also appreciate the specialist advice and after-sales service available.

However, small appliances, for example toasters and kettles, are more likely to be purchased in a supermarket, as shoppers perceive less risk in buying these in a non-specialist outlet. Nonetheless, 16 per cent of shoppers IGD spoke to said that they would be prepared to buy large appliances in a supermarket, indicating potential for market growth.

Joanne Denney-Finch, IGD chief executive, said: "After years of development, non-food is becoming a key part of the strategy for most major multiples, and it's clearly paying off. Our research shows that many shoppers are making supermarkets their destination for many non-food items. They are most attracted by being able to buy everything under one roof, and by the fact that they believe the prices are lower.

"Both retailers and manufacturers can build on the fact that non-food attracts shoppers into a store, and work together to exploit the many opportunities available, for example cross-category promotions."

Related topics: Market Trends

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