Malaysians the Most Price-Sensitive Shoppers in Asia Pacific

Results from the latest Shopper Trends Survey by Nielsen reveal that hyper and supermarket shoppers in Malaysia are the second most prolific promotion-seekers in Asia Pacific, after shoppers in Vietnam.

86% of these shoppers are driven by retail promotions - 2 out of 10 shoppers say they will just change stores based on best promotions offered and 65% will actively look out for promotional items.

This large proportion of promotion-focused shoppers, an increase of 5 percentage points over 2009, was a mere percentage point behind Vietnam. The regional (Singapore, Malaysia, Vietnam, Philippines, Thailand, Indonesia, New Zealand, China, Hong Kong, India, Korea and Taiwan) average was 68%.

Malaysians are also the most price-sensitive shoppers (at 68%) in Southeast Asia. 13% of hyper and supermarket shoppers in Malaysia stated that they know all the prices of items they buy regularly.

55% (up 9% from 2009) know the prices of most items and they would also notice price changes. Across the 12 countries surveyed in Asia Pacific, India has the highest proportion of price-sensitive shoppers (88%).

Teoh Choon Keat, Associate Director of Retail Measurement Services, Nielsen Malaysia, said, “In an inflationary environment, shoppers are exercising more caution when it comes to spending on everyday household items. As a result, they become more conscious of price increases. In order to stretch their ringgits, they are willing to visit more outlets in search of better bargains during their shopping trips. The outcome is a budding emergence of a loyalty issue for retailers and manufacturers, as shoppers become less loyal to any stores.”

As an indication that loyalty to stores is slipping, the number of shoppers who claimed to have visited only 1-2 stores (53%) dropped 20% year-on-year. On the other hand, 46% of hyper and supermarket shoppers are visiting 3-6 stores, most likely in an effort to broaden the scope of their hunt for bargains and value.

“Across all trade channels for fast-moving consumer goods, the good news is that consumers are still spending the bulk of their money in hypermarkets (37%) and supermarkets (33%). In view that switching stores based on promotions or price is a strong pulling factor for shoppers, both retailers and brand owners would need to develop more active strategies such as cash vouchers to protect or grow their market share. Longer-term constructs such as rewards-based redemption programmes may also help to build stronger shopper loyalty,” said Teoh.

The intensified competition among hypermarkets translated into an increase in advertising spending in newspaper in 2010, up 14.6% year-on-year to RM126 million based on published rate cards. Hypermarkets spent RM 130 million in advertising across media in 2010, ranking 2nd in the retail category, according to Nielsen’s Advertising Information Services

Minimarkets

In 2010, minimarkets gained popularity in terms of shopping repertoire as shoppers visited this channel more frequently. A third of the shoppers surveyed claim they paid a visit to a minimarket in the past four weeks. 6% of the shoppers said they actually spent the most money in this trade channel (doubled from 2009).

The growing popularity of minimarkets amongst shoppers could be due in part to the increasing availability of these stores - the number of minimarket outlets jumped by 63% in 2010 year-on-year.

“Although the base is small (total 408 outlets), the minimarket is the fastest growing trade channel in terms of new outlets for 2010. This has made minimarkets a lot more accessible by shoppers. Besides store accessibility, minimarkets have also been very competitive in pricing, offering products which are good value for money. Coupled with the convenience factor and simple store layouts, this emerging channel is going to become a strong force to content with in 2011 and beyond,” Teoh said.

Main Shoppers

Since 2008, Malaysia has had the highest percentage of males who are the main/primary shoppers for households in Asia Pacific. In 2010, this percentage was 37%, ahead of the Philippines (33%), China and Hong Kong (both at 32%).

Overall, females (63%) are still the main shopping decision makers across households in Malaysia, while males (62%) are playing a more active role in influencing purchasing decisions. 

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