Nielsen, a leading global provider of information and analytics around what consumers watch and buy released a new report revealing that Malaysia has the highest proportion of sales-seekers among the 51 countries surveyed. More than three-quarters (78%) of online respondents in Malaysia indicated that they buy items when products are on sale to save on household expenses. Other countries in the top five for sales-seekers are Turkey and Hungary (both at 77%), and Croatia and South Africa (both at 76%).
Nielsen’s 2011 Global Online Shopping and Saving Strategies Survey of more than 25,000 Internet respondents in 51 countries shows that purchasing large value packs (46%), shopping at valueretailers (45%) and using coupons (43%) are other popular savings strategies employed by Malaysians (Chart 1).
“Rising fuel prices and an overall higher cost of living have prompted Malaysian consumers to actively search for ways to stretch their money and manage their budgets while intensified competition among hypermarkets has led to Malaysian consumers constantly being invited to participate in sales and promotions,” said Mukund Tripathi, Director of Retail Measurement Services, Nielsen Malaysia. “This pull factor from the retailers has not only fed the consumer’s desire of buying consumers goods at lower prices, but has also driven them to be more price-sensitive.”
As a result, the most influential factor for consumers choosing where to shop is lowest prices, with more than three out of five consumers saying that is “highly influential.” The second-most influential factor is having a convenient location (61%). Great sales or promotions rounds out the top three, with 57 percent of consumers saying that is an important driver for choosing which store to patronize (Chart 2). Good value for money and items being regularly in stock are other attributes considered as highly influential by more than half of the respondents.
Larger does matter
As subsidy rationalisation on commodities continues to take place within the country and raw materials costs continue to rise, 41 percent of online consumers would prefer the manufacturers offer larger economy sizes with a lower price per usage/serving. Twenty percent of respondents think that introducing new, smaller pack sizes at lower prices is a better choice while only 1 out of 10 Malaysians would buy modestly reduced packaging size/downsized packages of products at existing prices. Raising prices of existing items proportionately is the least-favoured option (Chart 3).
“Larger packages are always seen as big value savers (value for money) for consumers and it is still the preferred option,” said Mukund. “Recently, we have seen that some manufacturers have reduced packaging size while maintaining the price of the package (to cover the cost of production), but these are generally temporary measures. Package downsizing at a constant price is not a sustainable option.”
Stocking up or making quick trips?
While accessibility to retailer sales and promotions is greater within the country, consumers may end up buying more than they actually need with 36 percent of online consumers surveyed saying that stocking up on groceries or household staples is their primary reason for making a shopping trip. By contrast, one-quarter of the respondents say they will make a quick trip to the store to replenish an item they run out of at home. When a few essential items are missing, 23 percent of the online consumers would not mind making a quick shopping trip to just pick up a few of them (Chart 4).
Flexible retailing options for grocery shopping are welcome
More than three in five (62%) respondents say they are likely (24% highly likely and 38% quite likely) to take advantage of online shopping only if goods are delivered to their homes. Picking up online orders inside the store (47%), via drive-through (46%) or making a curbside pick-up outside the store (35%) all of which involve travelling are not vastly preferred. If they need to travel or purchase offline, 60 percent (23% highly likely and 37% quite likely) of the consumers indicate that they are likely to try hand-held scanners to record purchases while shopping to avoid waiting at the checkout lines.
“Convenience is also highly sought after by most Malaysian consumers after lowest price,” said Mukund. “Conveniences include nearby locations, easy access once in-store or even easy payment. Credible retailers who can offer worry-free or secured online payment channels with delivery may be able to create an alternative shopping experience in terms of convenience to the technology savvy and dependent consumers.”
About the Nielsen Global Online Survey: The Nielsen Global Online Shopping and Savings Strategies Survey was conducted between March 23 and April 12, 2011 and polled more than 25,000 consumers in 51 countries throughout Asia Pacific, Europe, Latin America, the Middle East, Africa and North America. The sample has quotas based on age and sex for each country based on their Internet users, and is weighted to be representative of Internet consumers and has a maximum margin of error of ±0.6%. This Nielsen survey is based on the behavior of respondents with online access only. Internet penetration rates vary by country. Nielsen uses a minimum reporting standard of 60 percent Internet penetration or 10M online population for survey inclusion. The Nielsen Global Online Survey, which includes the Global Online Consumer Confidence Survey, was established in 2005.