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Top Shoppers Key to Supermarket Profitability

December 14, 2009
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A 12-week analysis of more than 2 million grocery shoppers by Concept Shopping, Inc., Lisle, Ill., reveals that the top 10 percent of a given store's customers visit more than twice a week, spend more than $39.00 per visit and represent nearly 40 percent of the store’s total sales.


A 12-week analysis of more than 2 million grocery shoppers by Concept Shopping, Inc., Lisle, Ill., reveals that the top 10 percent of a given store's customers visit more than twice a week, spend more than $39.00 per visit and represent nearly 40 percent of the store’s total sales.

The study also found that these "most valuable" shoppers tend to remain very loyal to the store, with 95 percent continuing to shop there throughout the year. Conversely, only 34 percent of the store's worst shoppers - those in the lowest percentile who visit less than once a month and spend only $9.00 per visit - remain long-term customers.

In addition, the study noted, the top 10 percent of shoppers spend only 11 percent of their dollars on products marked down, making them the most profitable shoppers as well. The worst shoppers, on the other hand, spend more than 35 percent of their dollars on sale items, actually making these shoppers unprofitable for the store (assuming a 33 percent profit margin).

"Shopper churn is a fact of life for every marketer," said William Young, Concept Shopping's vice president of sales and marketing. "Shopper loyalty continuously ebbs and flows through retail banners and store types, but sorting shoppers by their value helps identify which ones should be courted and which ones can be ignored."

Young added that other studies have shown it costs a retailer about five times as much to win a new customer as to keep a current one.

“Retailers should spend the lion's share of their time, effort and promotional dollars on their top-spending loyal customers," he said.

For more information, visit http://www.conceptshopping.com.

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