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Cost-conscious Consumers Love Wal-Mart for Low Prices, Reduce Overall Spending Due to High Cost of Gas, According to ARG Study
Charleston, SC, May 30, 2007… A whopping 94.8% of Americans have shopped at Wal-Mart in the last three months, but overall 49.8% of consumers reduced their shopping and spending in April due to higher gas prices, according to new data from a national survey released today by America’s Research Group (ARG).
The survey revealed that of those consumers who shopped at Wal-Mart, 83.4% believe that Wal-Mart has the lowest prices, and of those who shopped there because of their low prices, 75.7% bought Wal-Mart brand groceries to save even more.
“Wal-Mart is breaking down brand loyalty one supermarket at a time,” said C. Britt Beemer, Chairman of ARG. “At this rate, Wal-Mart brand groceries will push name brands either to lower their prices or to become less competitive in the supermarket retail world,” he predicted.
High gas prices are at the bottom of this cost-conscious attitude on behalf of consumers, according to Beemer. The survey data revealed that if prices move to $3.50 per gallon, 18.9% of consumers will spend “much less” and 51.2% will spend “some less” this summer, potentially threatening back-to-school spending and forcing parents to spend less this year than last.
Beemer said that there could be a retail industry “melt-down” this summer if Americans see gas prices get to $3.50 and stay there for a month or two. Consumers worry that gas prices will not fall below $3.00 a gallon in the future once the price reaches $3.50.
The situation bodes well for Wal-Mart. Their store shopping levels continue to grow, in spite of negative publicity, even though their comp store sales have not been strong for 2007, according to Beemer.
The telephone survey of 1,000 adults was conducted May 18 to 20, 2007. The error factor is plus or minus 4.3%. ARG is known for its Consumer Mind Reader™ surveys which are conducted six times a year.
America's Research Group is the consumer behavior marketing firm that provides clients the insight, strategy and tactics to increase market share. America's Research Group's expertise in consumer behavior has made it a key resource and advisor to leading brands and top retailers in the nation for 27 years.
Contacts: Britt Beemer, ARG, tel: 843 345 0939
BBA Communications: Barbara Burns/ Eve Edwards
Tel: 212 486 1140 / 516 859 3402