Press Releases

Archives (2005 to 2008)


	2/5/2009 New IRI Insights: Lower-Income Shoppers Represent Major Opportunity for U.S. Retailers and Manufacturers in Challenging Economy Lower-Income Shoppers to Spend Incremental $84 billion on CPG during Next Decade CHICAGO, Feb. 5, 2009 – Lower-income shoppers are the fastest-growing income group in the United States and will generate $84 billion in incremental spending during the next decade. The latest research from Information Resources, Inc. (IRI) reveals that these consumers represent an enormous opportunity for retailers and manufacturers during the slow economy, if they understand that lower-income shoppers are not a homogenous group. “The Lower-Income II Report: Serving Budget-Constrained Shoppers in a Recessionary Environment” uncovers the critical differences and recessionary spending patterns and behaviors of lower-income micro segments that are driving today’s CPG growth. The IRI report identifies five key lower-income micro segments that will be responsible for many growth opportunities and uncovers huge variations in shopping frequency and spending levels as well as channel and category-level dynamics. The report empowers retailers and manufacturers to better understand the key differences among lower-income households, so that they can use these valuable insights to their competitive advantage in hopes of attracting and retaining lower-income household loyalty. “Lower-income households are one of the hottest opportunities in the marketplace and will provide real growth for those who want to truly learn about the various micro-segments and their changing behaviors due to the economy,” says IRI Consulting and Innovation President Thom Blischok. “Our latest research goes beyond the usual narrowly-focused reviews and provides meaningful implications and action steps which retailers and manufacturers can use today to drive growth. At this point in history, the lower-income shopper is continuously challenged to stretch each and every one of their dollars, which will continue for at least the next four-to-eight years.” “Our detailed channel and category-level analysis focuses on how the five lower-income micro segments are changing where they shop and what they buy during the current recession,” explains Sean Seitzinger, senior vice president, IRI Consulting and Innovation. “Once you understand the wants and needs of the different shopper segments, you can then put the right products with the right pricing on the right shelves with the right displays to meet all of their needs.” Lower-Income Micro Segments IRI studied five lower-income micro segments, which are positioned to drive a large share of sales growth for retailers and manufacturers during the challenging economy: Singles and married couples aged 25-34 Seniors older than 65 Households with children Hispanics African Americans For each micro segment, the report delivers four-year trends of key performance indicators (KPIs), including category development, sales growth, and household penetration across 60 food, beverage and non-food categories. The IRI analysis provides insights into which categories a best positioned for growth, which is most vulnerable, and how retailers and manufacturers should respond. Shopping and Spending Trends During the third quarter of 2008, CPG spending and private label performance has improved, which is a trend being led by lower-income shoppers. However, most retailers are still missing the mark on their private label offerings and marketing to lower-income shoppers, who represent the single largest private label opportunity in the next five years. Progressive retailers can drive private label growth if they focus on building stronger relationships with lower-income shoppers by improving variety and packaging. Compared with other income groups in today’s economy, budget-constrained, lower-income shoppers are shopping more frequently, but are spending less per trip. They are also aggressively shifting spending across channels, retailers, categories and brands. In addition, younger households and households with kids are driving growth across key food categories. African American and older household spending has increased notably in salty snacks and chocolate candy, and Hispanics have increased their spending on frozen dinners and cereals. Retailer and Manufacturer Action Steps Retailers can make the most out of their own unique opportunities by working with the following four-phase process designed to help retailers: Value the size of the business opportunity and investment implications Utilize lower-income household segmentation as a means to differentiate from competitors Understand lower-income spending nuances and proactively adjust store offerings Validate the required steps towards success and execute and drive the process Manufacturers can also win a larger share of spending across lower-income segments by sharpening their focus on these groups and better understanding emerging trends and future implications for their categories and brands. Specifically, the IRI report provides clear direction for manufacturers on how to: Determine lower-income shopper share and growth performance Benchmark performance to calculate opportunity Identify opportunity gaps, such as “where/why are we getting less than our fair share?” About the Report “The Lower-Income Shopper Report: Learning to Better Serve Lower-Income Shoppers” is a culmination of research that includes a four-year analysis of shopping behavior across five lower-income segments and an exclusive IRI AttitudeLink survey of shoppers, in-depth case studies, and secondary research to develop an understanding of the marketplace and factors impacting lower-income households. For more information about the report and to view the executive summary, visit: http://us.infores.com/Insights/Reports/TheLowerIncomeIIReport/tabid/220/Default.aspx. For detailed information about the research available and pricing, contact Sean Seitzinger at sean.seitzinger@infores.com or Thom Blischok at thom.blischok@infores.com About IRI IRI is the world’s leading provider of consumer, shopper, and retail market intelligence and insights supporting 95 percent of the FORTUNE Global 500 consumer packaged goods (CPG), retail and healthcare companies. Only IRI offers the unique combination of integrated market information, automated and predictive analytics, innovative enabling technologies, and domain expertise. With IRI, leading retailers and manufacturers are able to quickly discover breakthrough insights driving smarter decisions and actions across the enterprise for breakthrough results. Companies around the world depend on IRI for improved productivity, stronger brands, and dramatic revenue growth. For more information, visit http://us.infores.com. # # # IRI CONTACTS: John McIndoe E-mail: john.mcindoe@infores.com Phone: (312) 474-3862 Fax: (312) 474-2512 Shelley Hughes E-mail: shelley.hughes@infores.com Phone: (312) 474-3675 Fax: (312) 474-2512

Archives (2005 to 2008)

New IRI Insights: Lower-Income Shoppers Represent Major Opportunity for U.S. Retailers and Manufacturers in Challenging Economy