The supermarket sector is highly concentrated with two chains dominating the market.
The battle has been fierce. Coles launched its Status Quo-inspired campaign, Down Down, forcing Woolworths to respond with Everyday Low Prices.
Coles then upped the ante with Deeper Down Down, enticing German discounter Aldi into the fray as it steadily increased its market presence.
Supermarkets use newspaper media to grow their customer base and drive store visits.
The degree of their trust in newspaper media is illustrated by the tens of millions of dollars dedicated to capturing market share though print advertising.
Recent CEASA figures show that retailers spent $830 million dollars on advertising in newspapers over a 12-month period to June 2013.
In that time, Wesfarmers and Woolworths were two of the three top advertisers in national and metro press, alongside Harvey Norman.
Newspaper Media Reaches Shoppers
Newspaper media reaches 4 out of 5 main grocery buyers, according to emma data.
Shoppers who read newspapers spend more on groceries than non-newspaper readers. Heavy newspaper readers spend an average of $144 a week – some $7 more than non-newspaper readers ($137).
That’s a difference of $364 a year.
Where Shoppers Buy Groceries
According to emma data, 74 per cent of shoppers have visited Woolworths in the past four weeks, some 4 per cent more visits than to Coles or Coles Express (70%). IGA was visited by 41% of shoppers and Aldi pulled in 32 per cent. Obviously, some consumers shopped in a variety of grocery stores.
When emma respondents were asked to name their main supermarket, Woolworths came out on top with 38 per cent, compared with 29 per cent who preferred Coles. IGA and Aldi each had 9 per cent of so-called main-usage shoppers.
Three in five core Woolworths customers consider themselves loyal – the same result that was achieved by Coles.
Aldi has the strongest connection with its customers with 84 per cent professing loyalty, perhaps because of its approach to differentiate through lower prices at the expense of product choices.
Some 40 per cent of grocery shoppers say they are not loyal, which indicates that a large pool of shoppers remains up for grabs.
Newspaper media allows supermarkets to get their promotions in front of these shoppers daily, the first step in winning the battle for the floating customer.
That’s only half the battle.
Inspiring daily action
Supermarkets ultimately want shoppers to act on advertisements, and newspaper advertising is proven to inspire shoppers into action.
The Newspaper Works commissioned a large-scale ad effectiveness research project to get a better understanding of the actions shoppers take after seeing a newspaper ad.
A number of retail newspaper ads were tested with shoppers using our proprietary newspaper metric called ActionMap™. The results are contained in a report called “For a retail action, call on newspapers”. Download a copy here.
One case study within the report shows how a Woolworths print newspaper ad excelled in driving trial and purchase behaviour. Shoppers who viewed the ad were six times more likely to try or buy the products advertised than the retail average.
Another case study shows how shoppers who viewed an Aldi newspaper ad were three times more likely to visit an Aldi store than the retail average. The same ad also had a positive impact on Aldi’s brand equity, increasing familiarity and relevance scores for the brand.
The newspaper media audience are actively engaged when they’re reading. They’re not browsing or tuned out, which means they’re more receptive to advertising messages. Consequently, they are more likely to take action than anyone else.
Sources: emma™ conducted by Ipsos MediaCT, People 14+ for the 12 months ending December 2013, Nielsen Online Ratings December 2013, People 14+ only.