Electronic Journal of Polish Agricultural Universities (EJPAU) founded by all Polish Agriculture Universities presents original papers and review articles relevant to all aspects of agricultural sciences. It is target for persons working both in science and industry,regulatory agencies or teaching in agricultural sector. Covered by IFIS Publishing (Food Science and Technology Abstracts), ELSEVIER Science - Food Science and Technology Program, CAS USA (Chemical Abstracts), CABI Publishing UK and ALPSP (Association of Learned and Professional Society Publisher - full membership). Presented in the Master List of Thomson ISI.
2006
Volume 9
Issue 3
Topic:
Economics
ELECTRONIC
JOURNAL OF
POLISH
AGRICULTURAL
UNIVERSITIES
Idzik M. 2006. TENDENCIES AND CONDITIONS OF BASIC CONSUMER GOODS MARKET DEVELOPMENT, EJPAU 9(3), #10.
Available Online: http://www.ejpau.media.pl/volume9/issue3/art-10.html

TENDENCIES AND CONDITIONS OF BASIC CONSUMER GOODS MARKET DEVELOPMENT

Marcin Idzik
Department of Agricultural Economics and International Economic Relations, Warsaw Agricultural University, Poland

 

ABSTRACT

The paper presents results of the research on purchase habits of Polish consumers, conducted in following years: 1992, 1995, 1997-2005, describing changes of their preferences and habits’ trends. Polish consumers’ purchase behaviour has been changing, becoming similar to the European standards. Concerning evaluation of economic potential of households, some transformations of the goods’ purchase process as well as changes in consumer purchase opinions and preferences were recognized.

Key words: consumer, preferences, supermarkets, shopping, FMCG, promotion.

INTRODUCTION

Changes in a consumer’s environment have been an incentive to search for new ways of an action. Moreover, they create some possibilities of new experiences, which exemplifications are some types of market behaviour. A consumer, in conditions of trade networks development as well as a comprehensive and continuous supply, has got new possibilities of making decisions, which are the most beneficial to him. Furthermore, tendencies and conditions of consumers’ purchase habits depend on real incomes of households (which, in fact, do not come up to their expectations) as well as low values of consumers’ optimism ratios.

The paper presents an evaluation of consumers’ economic potential and an analysis of tendencies of Polish consumers’ purchase preferences and behaviour during the last decade. Research on Poles’ purchase habits mainly concern food and non-alcoholic beverages, which stand for about 30% of their expenditure <footnote1>. Transformations of a purchase process as well as changes of consumers’ opinions and purchase preferences were recognized. The results concerns research carried out in December of each of the following years: 1992, 1995, 1997-2005, on a representative sample of Polish society. The source of an empirical material was a tracking research conducted by the Pentor Research International. Each of the research cycles was carried out among a random, 1000-person representative group of citizens aged above 15. The surveys (personal “face to face” interviews) were conducted at weekends, at respondents’ places, selected by a random-route method. In each of the cycles, a set of 200 research areas was drawn. The drawing algorithm was based on data of the National Census of Population and Housing, which were also used in a procedure of the research results’ weighing.

ECONOMIC ASPECTS OF CONSUMER PURCHASE POTENTIAL

An amount of incomes has been a major factor, which has got an impact on a consumption level. It has been confirmed by a high priority given to low prices, while making decision on a shopping place and its diversification concerning the amount of households’ incomes. Families that earn less than 2000 PLN a month, as a deciding reason of a shop’s choice indicate low prices – about twice more frequently than families of higher incomes. Furthermore, households’ budget researches confirm that there was decrease of the most of major groceries groups’ consumption in 2004. It means that a level of Polish consumers’ main needs’ satisfaction has been decreasing. In a deteriorating income situation, first need products’ prices have been getting more and more important.

A high priority, given to minimising of costs concerning major consumption needs’ satisfaction, depends on unsatisfactory, in the opinion of Poles, evaluation of households’ economic situation. Regarding 40% of households, it is not possible to keep liquidity in case of total loss of incomes, even for a short period. In one of our Polish households only, in case of total loss of incomes, savings would allow to live longer than one month (graph 1).

Graph 1. Evaluation of a household’s economic situation
Source: [1], [2].

Frequently, purchase of everyday products is connected with a necessity for consumption credits use. Such a situation takes place in one out of five households, which allocate the credit funds in realisation of the household’s current needs, concerning purchase of goods of low demand elasticity (graph 2).

Graph 2. Allocation of consumer credits
Source: [1], [2].

An expression of higher activeness of Poles in the credit service market, especially consumption credits, is a number of changes observed in value and conditions of taken credits. An average number of credits’ repayment months has been rising, whereas an amount of a singular consumption credit instalment has been decreasing. One of popular resources of current needs’ financing is also a credit line on a current bank account, which has been systematically becoming more and more popular.

TENDENCIES OF CONSUMER PREFERENCES

A consumer, as a market participant, takes up decisions and actions that aim to satisfy his particular consumption needs. Poles reveal various reasons for choice of a place, were they do their shopping the most willingly and frequently. Importance of particular reasons for a shopping place choice, in the society perception, has almost not changed during last ten years. The most important reasons are following: low prices, high products’ quality, short distance between a living place and a shopping place, nice service, attractive offer, habits, shops’ opening hours as well as promotions and sales (graph 3). Such factors as a size of a shop, convenient driveway, parking or possibility of paying by cards play less essential role. However, the importance of the last factor has been growing slowly, but continuously. About 88% of Poles claim that products’ prices play a decisive or important role. Moreover, high quality of products has essential meaning for 87% of the respondents.

Graph 3. Importance of factors influencing choices of shopping place
Source: [1], [2].

Concerning Polish consumers’ preferences, 79% of the respondents claim that it is always worth to pay more if the products a higher quality one. In comparison to 1995, in 2005 they paid more attention to the goods’ quality (graph 4). Besides, they have also become more demanding. There are not so able to find what they need or any special occasions at shops, as frequently as they were in 1995. What is more, Poles have become less loyal to marks and do experiments more willingly, choosing different marks; however, they make it the principle to buy products of known and trustworthy marks only.

Graph 4. Purchase preferences and habits of Poles
Source: [1], [2].

Polish consumers do not trust advertised products, and 66% of respondents are reluctant to purchase the advertised brand-new products. Increase of consumers’ mobility has been also observed, event though most of them (77%) have their own favourite shops, where they use to do shopping. Poles admit, more often than in 1995, that they go to a grocery almost each day. More than a half of the respondents (61%) always carefully check a best-before date or a production date, especially housewives (72%). Similar number of the respondents checks the product prices on their receipts. Furthermore, as in 1995, most of the respondents (70%) do precisely know what they should purchase and buy it. They usually (65%) have got exact amounts of money which they can spend a month.

EVERYDAY SHOPPING

In 2005, 43% of Poles spent total or most of the amount anticipated for everyday shopping in at self-service shops, whereas 29% f the respondents – at shops where products are handed by a shop-assistant (graph 5). On the other hand, 15% of the respondents spent similar amounts of money at both kinds of shops. From 1998, there has been a noticeable growing tendency of number of people who spend total or most of the anticipated amount at self-service shops. From 2001, systematic decrease of a number of persons spending total or most of the anticipated amount at shops wit a shop-assistant’s service has been observed. For the first time, in 2004, people who do their shopping only r mostly at self-service markets dominated in the respondents’ structure.

Graph 5. Allocation of normal each-week expenses
Source: [1], [2].

In 2005, in opinion of more than a half of the respondents (56%), there were women (housewives), who were responsible for choices and decisions concerning everyday shopping. Similar percentage has been observed from 2000 (graph 6). In more than one fifth of the household shopping was done by couples. One out of ten men took up responsibility for doing shopping on his own.

Graph 6. Household’s members responsible for purchase of groceries and everyday shopping
Source: [1], [2].

The last decade presents a decreasing tendency of a number of hours spent on shopping a week (graph 7). In 1992, shopping took 5.4 hours a week, in 1995 – 4.3 hours, in 2000 – 3.6 hours, whereas in 2005 – 2.7 hours. Moreover, it is observed that percentage of the respondents who spend less than three hours a week on shopping has been growing. Average time of doing shopping by women amounted to three hours, whereas by men – 2.8 hours. Relatively the greatest amounts of time were spent on shopping by people aged 40-49 (3.2 hours), families who live in households with income of 1000-1500 PLN (3.5 hours) and these who live in Warsaw (3.4 hours).

Graph 7. Number of hours spent on shopping a week
Source: [1], [2].

In 2005, like in previous years, more than a half of Poles declared doing the greatest shopping on Fridays and Saturdays (graph 8). More than one third of the respondents do their shopping systematically. Despite loud protests concerning prohibition of Sunday trade, only 1 out of 100 Poles declared doing the greatest shopping on Sundays – there were usually (36%) persons living in households of family income higher than 2000 PLN.

Graph 8. Days when usually larger shopping are done
Source: [1], [2].

Invariably, about half of Poles (48%) did their shopping usually at different time, 22% from 9 a.m. to 1 p.m., 14% – after 4 p.m., 9% – from 6 a.m. to 9 a.m., whereas 3% – from 1 p.m. to 4 p.m. Elderly people with a basic education, rural people and these who do not work (housewives, pensioners, unemployed) do relatively more often their shopping in the mornings. The largest cities’ dwellers, people active in the labour market as well as younger people visit shops usually after 4 p.m.

Most of Poles (66%) purchase groceries at these shops, which are situated in a close distance from their houses (maximum 5 minutes of walking). Average time of walking to a grocery amounted to seven minutes, and for 85% of the respondents did not exceed ten minutes.

PROMOTION ACTIONS AND SUPERMARKETS

One of symptoms of the retail sale market development is a variety of promotion actions that, in past six months, made four out of ten Poles buy something, even though thy were not going to buy it at all (graph 9).

Graph 9. Selected effects of promotion actions
Source: [1], [2].

Similar number of consumers decided t buy a new mark, unknown product, because it was in special offer. Promotion actions’ effects are seen also in large amounts of purchased products. In 2005, such a decision was made by one out of three persons. The same year, about 36% of the respondents decided to go shopping, because they were informed about a special offer. The number of consumers, who were made to go shopping because of promotion, has been systematically growing from 2003. Similarly, from 2001 the most favourite forms of promotion have been as following: price discounts and possibility of receiving more amount of a product for the same price (graph 10).

Graph 10. Favourite types of promotion actions
Source: [1], [2].

Each year super and hypermarkets networks have been growing. Likewise, a number of Poles who support doing shopping there has been increasing. The percentage of the enthusiasts increased from 30% in 2000 to 42% in 2005 r., whereas percentage of the objectors – from 26% in 2000 to 22% in 2005 (graph 11). The best known hyper and supermarkets networks include: Biedronka – the Jerónimo Martins Group (61% of spontaneous contacts and 92 % of supported contacts), Tesco (42% and 71%), Real (31% and 56%), Geant (30% and 52 %) and Auchan (28% and 47%).

Graph 11. Support for supermarkets’ networks development
Source: [1], [2].

CONCLUSIONS

The empirical material analyses as well as theoretical discussion entitle to make following statements and conclusions.

  1. Polish consumers’ purchase behaviour has changed during the last decade. A scale and a tempo of changes of purchase habits and preferences allow to claim, that Polish consumer has been learning and adaptation to new conditions very quickly.

  2. Suppliers and producers are demanded to widen their products’ offer by “economy products”, for the reason that a major factor deciding on a shop choice concerns economic reasons.

  3. There has been a growing tendency of a number of persons who spend the total anticipated amount or most of it at self-service shops. A group of consumers who spend the total anticipated amount or most of it at shops, where products are handed by a shop-assistant, remain as a minority.

  4. Social approval for super and hypermarkets’ networks is moderate; however, this support has been growing slowly, but systematically.

  5. Percentage of consumers, who were made motivated to go shopping just by information of a special offer, has been increasing continuously.

  6. Consumers have become more demanding, what motivates producers, suppliers and distributors to pay more attention and care to quality of goods and services.

  7. Diversified and various supply offer makes that everyday products are usually bought at self-service shops or supermarkets.

  8. Determinants of shopping place choice remained similar during the research decade. A decreasing tendency of time spent on shopping a week has been observed. More and more consumers purchase everyday-use goods once a week. More often couples do their shopping together.

  9. Most of Poles act rationally and economically when they do shopping, as they exactly know what they should buy and purchase only necessary products. They usually have got the exact amount of money they can spend each month.


REFERENCES

  1. Omnibus XII 1992, 1995, 1997-2005, Pentor Research International.

  2. Polski konsument 1992-2005 [Polish consumer 1992-2005] Pentor Research International, Warsaw [in Polish].


FOOTNOTE

1. In the EU (15) the expenditures amounts on average to 20%. Such a difference results from economic factors connected with consumers’ purchasing power.

 

 

Accepted for print: 26.08.2006


Marcin Idzik
Department of Agricultural Economics and International Economic Relations,
Warsaw Agricultural University, Poland
166 Nowoursynowska Street, 02-787 Warsaw, Poland
email: midzik@pentor.com.pl

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