Retail Consumer Survey 2014

Transcription

1 Retail Consumer Survey 2014

2 CONTENTS All care has been taken in the preparation of this document and the information contained herein has been derived from sources believed to be accurate and reliable. Broll Property Group (Pty) Ltd will accept no responsibility for any error, action or omission, any opinion expressed or any investment decisions made and/or based on this information. 1. Introduction 3 2. The Respondents 3 3. The Retail Environment Shopping Methods and Activities Browsing Generally for Products Looking for Something Specific Checking Prices or Product Details Buying Products Shopping Methods and Activities in 2 Years Time Visit a Shop Go Online Use a Catalogue or Mail Order Activity Frequency Important Factors to Consider When Choosing Where to go Shopping Male vs Female Income Groups Shopping Centre Types Frequented Transport Methods Used and Travel Time Change Over the Last Three Years Agree or Disagree Closing Remarks 21 Neither the whole nor any part of this document, nor any reference thereto may be included in any published document, circular or statement, nor published in any way without Broll s prior written approval as to the form or context in which it may appear.

3 3 1. INTRODUCTION In order to understand the consumer market within South Africa, Broll Property Group, an affiliate of CBRE - a leading global commercial real estate and investment firm, participated in a consumer survey. This survey, conducted by a third party, IPSOS was based on a sample size of 1,000 individuals undertaken throughout South Africa. Below are the survey results based on the questions which partcipants responded to. 2. THE RESPONDENTS The majority of respondents were from Gauteng (42%) followed by 25% from the Western Cape, 13% from KwaZulu-Natal and the remaining 20% were from other six provinces. Number of respondents per province Eastern Cape Free State Gauteng KwaZulu-Natal Limpopo Mpumalanga Northern Cape North West Western Cape

4 4 Of the respondents, 364 were male and 636 were female and the ages of respondents varied from 18 to 54 years, with the majority (72%) aged between 25 and 44. Approximately 73% of respondents reside in households with three or more people (including themselves). With regards to income profiles, 940 individual respondents took part in this part of the questionnaire - 77% view their annual household income before taxes as being high, 16% view their annual household income before taxes as being medium and the remaining 7% view their household income as being low. This was confirmed by the number of individuals that own desktop personal computers, laptops, tablet computers and smartphones (see the graphs below). Of the total respondents, around 55% are optimistic about their household financial outlook over the next six months as they believe this will improve, 26% believe it will stay the same, 12% envision it will worsen with the remaining 6% having selected either don t know or prefer not to say. Age and gender of respondents Devices in households* No. of People Devices in Households Smartphone Tablet computer Laptop Desktop personal computer Male Female No. of People *Refers only to individuals that answered income profile question, i.e. 940 respondents 3. THE RETAIL ENVIRONMENT In terms of shopping centre types, South Africa is primarily made up of enclosed shopping centres and 96% of respondents indicated enclosed shopping centres are the main shopping centre types which they frequent when shopping for non-food items, 75% shop at large purpose-built covered centres, 21% frequent smaller covered centres and the remaining 4% were divided into two categories (3% indicated uncovered/high street retail and around 1% indicated don t know/don t go on shopping trips). Furthermore, in relation to the different age groups of respondents, income groups, gender, etc. it was found that large purpose-built covered centres were frequented the most (i.e. in excess of 70% in each group).

5 5 3.1 Shopping methods and activities With regards to the methods of shopping that respondents use for non-food items, when it comes to browsing generally for products, looking for something specific, checking prices or product details and buying products, online is the most popular for all categories with the exception of buying products where the chosen method is visit a shop. Shopping methods for varying activities PREFER SMARTPHONE WHEN LOOKING FOR SOMETHING 32% SPECIFIC Use a catalogue or mail order - 15% Go online on a tablet - 19% Go online on a desktop / laptop - 72% Visit a shop - 67% PREFER WHEN CHECKING LAPTOP/ DESKTOP 73% PRICE Use a catalogue or mail order - 24% Go online on a tablet - 20% Go online on a smartphone - 36% Visit a shop - 62% PREFER TABLET WHEN BROWSING FOR 20% PRODUCTS SHOP 95% WHEN BUYING PRODUCTS STILL PREFER TO VISIT A SHOP Use a catalogue or mail order - 23% Go online on a smartphone - 33% Go online on a desktop or laptop - 71% Visit a shop - 60% Use a catalogue or mail order - 12% Go online on a tablet - 12% Go online on a smartphone - 14% Go online on a desktop or laptop - 48% When focusing on the different online shopping methods which respondents were allowed to choose from, the most popular method is using a laptop or desktop followed by smartphones and tablets. Below are the detailed results of options selected by respondents with regards to the various shopping methods used for browsing generally for products, looking for something specific, checking price details and buying products.

6 Browsing generally for products Respondents across all age groups access the internet via a laptop or desktop followed by visit a shop. However, in the 18 to 24 year old age group this was extremely close with 74 people indicating go online via a laptop or desktop and 73 people indicating visit a shop. The next most selected category was go online on a smartphone except for those aged 45 to 54 where use a catalogue or mail order was the next highest category followed by go online on a smartphone. Go online using a tablet and use a catalogue or mail order were the least selected methods. Browsing generally for products Age Group No. of people Go online on a laptop or desktop Go online on a smartphone Go online on a tablet Visit a shop Use a catalogue or mail order

7 Looking for something specific When looking for something specific the top three methods used by all age groups are online on a laptop or desktop, visit a shop and go online on a smartphone. The least used methods are online on a tablet and use a catalogue or mail order. Interestingly, despite access to smartphones and tablets, many consumers still access the internet using a desktop or laptop could it be that many do this while at work or at an internet café? Looking for something specific Age Group No. of people Go online on a laptop or desktop Go online on a smartphone Go online on a tablet Visit a shop Use a catalogue or mail order

8 Checking prices or product details When checking prices or product details, all respondents indicated that their top three chosen methods are online via a laptop or desktop, visit a shop and online on a smartphone. The least used methods are use a catalogue or mail order and online on a tablet. Checking price or product details Age Group No. of people Go online on a laptop or desktop Go online on a smartphone Go online on a tablet Visit a shop Use a catalogue or mail order

9 Buying products Once a decision is made to buy non-food items, respondents go to the shop and this is true across all age groups. The number of respondents that selected visit a shop as their chosen method when buying products was substantially higher, practically double, in comparison to any of the other methods across all age groups. Buying products Age Group No. of people Go online on a laptop or desktop Go online on a smartphone Go online on a tablet Visit a shop Use a catalogue or mail order The above data shows that South African consumers across all age groups use online shopping methods, in particular, using their laptop or desktop, to conduct shopping research but when it comes to physically buying non-food products this is done by means of visiting a shop regardless of age. 3.2 Shopping methods and activities in 2 years time After determining the methods which the respondents use for various shopping activities, they were then asked how they expect to conduct shopping for non-food items in two years time. The responses indicate that an increase in online shopping is expected, with 71% of respondents using a laptop or desktop to shop online, a smartphone (57%) as well as a tablet (52%). In relation to visiting a shop and using a catalogue or mail order the majority of respondents believe no change is expected to take place, (47% and 40% of respondents respectively).

10 10 Expected shopping methods in 2 years time Use a catalogue/mail order Go online on a tablet Go online on a smartphone Go online on a laptop or desktop Visit a shop No. of people Do less often No change Do more often Furthermore, data reveals that on different categories such as gender, age, income, household size, devices in household, household financial outlook and main shopping centres, the majority of respondents expect no change in visit a shop and use a catalogue or mail order, and expect to go online via laptop or desktop, smartphone and tablet more often. The only categories in which differences in responses were noted were as follows: Visit a shop 18 to 24 - approximately 38% (being the majority) believe they will do this more often whereas 35% believe there will be no change, and Of those that cited their household income as being low, 46% will visit a shop more often whereas 35% envision no change. This group makes up around 7% of total respondents Go online Of those who frequent uncovered centres/high street retail, 39% foresee no change in going on line on a smartphone, while 36% foresee an increase in usage Use a catalogue or mail order 34% of individuals that said their household income is low expect to use a catalogue or mail order less often while 29% will use this method more often and 25% expect no change.

11 Activity frequency Furthermore, respondents were asked the question: when thinking generally about shopping for non-food items, how often do they do specific activities, i.e. go into shops, order products online, order products from a retailer s website and collect them from the store, buy something else when picking up an online order from a store, compare product prices on a mobile phone when in or around a store, search a social networking site/access blogs for feedback and comments on products and use a shopping centre app. Interestingly, consumers make use of social media platforms to evaluate good and services, either by sharing own experiences or liking other consumers comments and feedback. Of the South Africans who took part in the survey, each individual had to provide an answer for each activity. Below are the findings: 55% of respondents visit the shops at least once a week with 30% having indicated two or more times a week. Additionally, 24% of individuals shop two or three times a month. 27% of individuals indicated that they order products online less often than every two or three months, 22% actually order products online every two or three months and only around 7% indicated that they do this at least once a week. 46% never order products online and collect them from the store with a further 24% having indicated that they do this less often than every two or three months. 40% of respondents never buy something else when picking up an online order with an additional 27% having indicated that they do this less often than every two or three months. 30% never compare prices on a mobile phone when in or around a store with 18% having indicated that they do this less often than every two or three months. 27% never use social networking for feedback and comments on products with a further 18% having indicated that they do this less (often less than every two or three months. However, around 13% indicated that they use social networking for feedback and comments on products two or three times a month and 50% of all people surveyed never use a shopping centre app. Furthermore, when looking at the different age groups, gender groups, income groups, shopping centre types frequented, for example, responses were similar and it seems the interaction between online and in-store activity is limited to a certain degree but some interaction is taking place. How many times a year do we do specific retail activities (non-food items)? 8 buy order online and collect in store 22 compare price when in store 13 use order online 9 something else when picking up online order 61 go into a shop 24 social networking for feedback on products 12 use shopping centre app

12 12 When focusing on different age groups, it appears that those between the ages of 25 to 34 order products online more regularly compared to other age groups. This may be attributed to the fact that a number of people enter the working world at around this age, as they are generally studying between the ages of 18 to 24, thus these working individuals tend to be tech savvy, earn a salary and have disposable income. Those aged between have the least number of people who order products online, however, it is important to note that the majority of all age groups only buy products online every two or three months or even less often Order products online Age Groups Never Less Often Every 2 or 3 months Once a month 2 or 3 times a month Once a week 2 or 3 times a month 0% 5% 10% 15% 20% 25% 30% 35% 2 or more times a week Once a week 2 or 3 times a month Once a month Every 2 or 3 months Less Often Never % 3% 7% 15% 23% 33% 16% % 3% 12% 14% 22% 32% 14% % 5% 15% 17% 21% 21% 16% % 3% 14% 13% 23% 23% 23% No. of people 3.4 Important factors to consider when choosing where to shop Respondents were asked which factors were important when deciding where to go shopping for non-food items these included aspects such as cleanliness, security, free parking, price of products, presence of certain products and retail offerings for example. The top three extremely important factors were cleanliness, security/personal safety and the price of products. With the least three important factors being the hosting of events such as fashion shows/movie launches, availability of free Wi-Fi and the presence of coffee shops.

13 13 Important factors to consider when choosing where to shop CLEANLINESS 4.50 out of 5 SECURITY 4.46 out of 5 PRICE OF PRODUCTS 4.35 out of 5 FREE Wi-Fi 3.18 out of 5 COFFEE SHOPS 3.09 out of 5 Cleanliness Security / personal safety Price of products Parking facilities Convenience to travel to Range of services available Range of retailers Presence of a department store Presence of information points/clear signs Offer of free parking Presence of a hypermarket/supermarket Presence of specific retailers Presence of good quality restaurants Being covered Being a good place to meet friends/spend time Presence of one or two large fashion shops The centre s environmental business practices Presence of independent shops Size of shops Having an extensive range of catering facilities Entertainment facilities available Availability of free Wi-Fi Presence of coffee shops Hosting of events such as fashion shows/movie * Note: the chart refers to the mean value for each factor based on all respondents answers including respondents that indicated don t know/not applicable. 1 = Not at all important, 2 = Not very important, 3 = Fairly important, 4 = Very important, 5 = Extremely important. When focusing on the top three most important factors according to mean values, the answers are the same across gender, income groups, shopping centre types frequented by respondents and different age groups. The difference comes in with regards to the least three important factors, although not extremly different, some differences can be noted, these are indicated as follows:

14 Male vs Female Male Hosting of events such as fashion shows/movie launches, presence of coffee shops and presence of one or two large fashion shops. Female Hosting of events such as fashion shows/movie launches, availability of Wi-Fi and presence of coffee shops Income groups Low Hosting of events such as fashion shows/movie launches, presence of coffee shops and entertainment facilities. Middle Hosting of events such as fashion shows/movie launches, availability of Wi-Fi and presence of coffee shops. High Hosting of events such as fashion shows/movie launches, presence of coffee shops and availability of Wi-Fi Shopping centre types frequented Large, purpose-built covered centres Hosting of events such as fashion shows/movie launches, presence of coffee shops and availability of free Wi-Fi. Smaller covered centres Hosting of events such as fashion shows/movie launches, availability of free Wi-Fi and entertainment facilities available. Uncovered/high street Hosting of events such as fashion shows/movie launches, entertainment facilities available and availability of free Wi-Fi. When one focuses on the different age groups particularly those between and 45 54, essentially young vs mature, the findings are similar in certain instances but vary in others. For example, both groups indicated that their top three extremely important factors are cleanliness, security/personal security and price of products. In relation to the least most important factors the younger generation indicated hosting of events such as fashion shows/movie launches, presence of coffee shops and availability of Wi-Fi, with the mature generation having indicated hosting of events such as fashion shows/movie launches, entertainment facilities avaiable and having an extensive range of catering facilities. The top three cateogries which indicated the largest differences between the two age groups (18 24 vs 45 54) in terms of mean values were: entertainment facilities available 3.57 vs 3.00 parking facilities 3.90 vs 4.36 and being a good place to meet friends/spend time 3.63 vs 3.20 The younger generation placed greater importance on entertainment facilities and being a good place to meet whereas the more mature generation place greater importance on parking facilities.

15 15 Important factors when choosing where to go shopping young vs mature Important factors when choosing where to shop middle age groups * Note: the chart refers to the mean value for each factor based on all respondents answers including respondents that indicated don t know/not applicable. 1 = Not at all important, 2 = Not very important, 3 = Fairly important, 4 = Very important, 5 = Extremely important. The age group placed extreme importance on the same three factors as the age group i.e. cleanliness, security/personal safety and price of products. Similarly, in relation to the least important factors, these were also the same, i.e. hosting of events such as fashion shows/movie launches, presence of coffee shops and availability of free Wi-Fi. When focusing on the year age group, the top three extremely important factors were the same as the other age groups while the three least important factors these were hosting of events such as fashion shows/movie launches, presence of coffee shops and entertainment facilities. From the above it can be seen that shopping centre developers, managers, owners and anyone involved in the development and daily running of a shopping centre needs to place immense importance on the cleanliness of the centre. Furthermore, security/personal safety needs to be considered in all aspects as shoppers need to feel safe both inside and outside of the centre. Aspects such as sufficient lighting in parking areas may impact upon the consumers decision as to whether or not they will shop at a particular shopping centre. Additionally, the price of products is vital for consumers and as such the tenant base within a shopping centre should allow for comparative shopping and the tenant offering should take the target market and catchment area of the centre into account.

16 16 Proper planning and sufficient research at the inception and construction phases of shopping centre development will assist in achieving all of the above. Continuous maintenance is also important, particularly in relation to the tenant mix which should be reviewed regularly to match the demographic profile of the centre s catchment area. Important factors to consider when choosing where to shop all age groups * Note: the chart refers to the mean value for each factor based on all respondents answers including respondents that indicated don t know/not applicable. 1 = Not at all important, 2 = Not very important, 3 = Fairly important, 4 = Very important, 5 = Extremely important.

17 Transport methods used and travel time When going on a shopping trip for non-food items 89.5% of the total respondents drive to the shops, the next highest category was walking (3.2%) followed by bus (2.5%). With the remaining 4.8% being via means of motor cycle/scooter, or train while 0.3% of respondents selected don t know/prefer not to say. In terms of travelling time, the majority of respondents (22%) indicated that it takes them approximately 6 10 minutes to reach their shopping destination of choice with regards to non-food items, 21.5% indicated minutes and 15.4% indicated minutes. Travelling time 61 + minutes minutes minutes minutes minutes minutes 6-10 minutes 5 minutes or less No. of people When looking at the centre types which respondents frequent the most, travelling times are quite similar, i.e. majority (22%) of individuals that indicated large purpose-built centres selected 11 to 15 minutes followed by 20% selecting 6 to 10 minutes, of those that selected smaller covered centres 27% selected 6 to 10 minutes and in a similar manner 36% of the respondents that indicated uncovered centres/high street retail also selected 6 to 10 minutes. Within all three centre types roughly 7% of respondents indicated that they travel in excess of 61 minutes to their preferred shopping destinations, thus majority of the respondents tend to be local shoppers.

18 Change over the last three years Respondents were asked how the shopping centre which they visit more often for non-food items has changed over the last three years- the majority indicated that the centre has gotten a lot better. The consensus across all categories (i.e. age groups, gender, income groups, main shopping centres frequented, etc.) is that the top three selected categories were: got a lot better, got a little better and stayed about the same and generally got a lot better or stayed the same were at the top of the list. When looking at centre types frequented by respondents the largest improvement was seen by those that frequent large purpose-built covered centres where 40% of respondents indicated got a lot better. With regards to smaller covered centres and uncovered centres/high street majority of respondents indicated the centres have stayed about the same, i.e. 36% and 43% respectively, but a number of respondents also indicated that the centres have gotten a little better as well as gotten a lot better. Changes in most frequented centres 3% 1% 3% 30% 36% 27% Go a lot better Stayed about the same Got a lot worse Got a little better Got a little worse Did not use the same shopping centre 3 years ago

19 19 Respondents were then asked to select areas in which they had seen an improvement in the last three years, of the total respondents, the top five areas in which improvements were noticed were as follows: 1. Renovation of the centres (47%) 2. The size of the centre has increased with more shops open (39%) 3. More/better catering facilities (29%) 4. The addition of new international brands (28%) and 200% Specific areas where an improvement has been seen 11% 14% 20% 5. More entertainment facilities (18%). 150% These top five areas were also reflected across gender group, age groups as well as for low and high income groups with all groups indicating the same areas area of improvement. Regarding the middle income group, the only difference was that the size of the centre has increased option was at the top of the list followed by renovation of the centre and the remaining areas. A detailed breakdown of specific areas where an improvement has been seen for the different types of centres frequented by all respondents can be seen in the graph to the right. 100% 32% 31% 5% 14% 12% 16% 24% 4% 43% 31% 11% 7% None of these 50% 25% More events Introduction of free parking 49% 44% 36% More entertainment facilities Addition of new international brands More / better catering facilities 0% Size increase / more shops -33% -46% -50% Renovation of the centre -50% Large, purposebuilt covered Smaller covered Uncovered/High Street *Percentages do not add up to 100% as respondents were allowed to select more than one option Percentages do not add up to 100% as respondents were allowed

20 Agree or Disagree Respondents were given four statements and had to indicate their level of agreement or disagreement with these statements - see results below. The statements and results are as follows: WHEN CHOOSING TO GO SHOPPING, I THINK... 38% STRONGLY AGREE...about the overall experience of visiting the destination, not just about the choice of shops. About the overall experience of visiting the destination, not just the choice of shops. 38% 36% 15% 9% 2% 28% TEND TO AGREE...I will use social media to keep up to date on special offers, events and advice on new shops at shopping centres. Big regional shopping centres will be the only places worth going to shop at in the future. 15% 22% 29% 23% 10% A smaller shopping centre can t compete with online for my shopping needs. 23% TEND TO DISAGREE...large regional shopping centres will be the only places worth going to shop at in the future. 12% 20% 32% 24% 9% I use social media to keep up to date on special offers, events and new shops at shopping centres. 24% TEND TO DISAGREE...a smaller shopping centre can t compete with online for my shopping needs. 18% 28% 23% 16% 15% Agree Strongly Tend to Agree Neither Agree/ Disagree Tend to Disagree Disagree Strongly

21 21 4. CLOSING REMARKS When looking at the overall survey results, it can be seen that South African shoppers are still getting accustomed to online shopping although online shopping research is taking place. Going into a physical shop is still important and is expected to remain so in the near future, however, online shopping is expected to increase in the near future as consumers get used to the idea. Consumers indicated that they think about the whole shopping experience when choosing where to shop and not just the choice of shops, a telling sign that shopping isn t a matter of picking up a product, it is about an experience and a whole lot more. Aspects such as cleanliness, security/personal safety, price of products, parking facilities, convenience to travel to, range of services available, range of retailers, presence of a department store, hypermarket, certain retailers, good quality restaurants, free parking, being a good place to meet friends and a lot more are considered fairly, very or extremely important in terms of deciding where to go shopping. Therefore, shopping centre owners, managers, and developers would do well to consider consumer behaviour, current and predicted, in order to remain relevant and maintain their share of the market. For more information please research@broll.co.za

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