NACDS, IRI: Millenial shopping habits key

ALEXANDRIA, Va. —Today’s shopper predominantly is buying less and will continue to buy less for the foreseeable future, according to Thom Blischok, president of consulting and innovation, for Information Resources Inc., who discussed the changing paradigm of today’s cash-crunched shopper as part of the National Association of Chain Drug Stores Retail Advisory Board’s ECON09 Webinar presented last month.

That doesn’t mean anyone should throw in the towel, however. What it means is that savvy marketers will pick up on the new paradigm and capture those new shoppers. “You need to expect these [emerging] trends to continue for at least the next 12 to 18 months. They could last as much as the next three to four years,” he said.

As the current recession shapes shopping behaviors going forward, there are three critical shopper segments health-and-wellness purveyors ought to understand and target. Two most marketers already know about, and in many cases have developed strategies to reach them—the baby boomers and Hispanics. The third, which overlaps both boomers and Hispanics, is “Millenials,” a category of consumers that may be somewhat difficult to target specifically as they are not defined by such traditional demographic markers as age or ethnicity, but by purchasing patterns and ideals.

Some important trends to be aware of include a shift around the de facto point of care for many consumers—the retail pharmacy. According to IRI research, 50% of Americans are using over-the-counter medicines to avoid the cost of visiting their family practitioner. As many as 44% are using the Internet in search of those answers they would have been posing to their doctors, a fact that justifies significant investments in online marketing. As many as 33% of Americans are putting off trips to the physician for routine examinations, suggesting that more pharmacists and nurse practitioners may be the first to identify potential health problems. “And very importantly, about 20% of Americans are currently using the medical services in drug as their new emergency room,” Blischok added.

Some of the more prominent behavioral shifts include the creation of a shopping list prior to going to the store—a factor that cuts down on impulse purchases and makes in-store merchandising a little less effective.

“[However], it doesn’t irradicate the need for in-store decision making,” Blischok said. “We also see that 43% of millenials are also making unplanned purchases after seeing deals in the store.”

More shoppers also are choosing the retail outlet around perceived lower pricing (51% of boomers), gravitating toward store brands (38% of Hispanics), reviewing a retailer’s circular for deals (49% of boomers) and stocking up on items because they were on sale (50% of millenials). “Millenials, by the way, are coping [with the recession] by using online resources to find coupons; online is a major part of their life,” Blischok said. “They’re also purchasing larger quantities earlier in the month.”