Retail bosses are held in higher esteem by the public than the Government, according to a study carried out by research and planning agency Leapfrog. Retail chiefs – especially the heads of supermarkets – are now more trusted collectively by consumers to provide the best information about the current economic climate than representatives of the state. They are also seen to be doing more good deeds to help people get through the recession.
The online survey, which polled 2,000 UK adults for their views, concludes that the collective views of the bosses at Tesco, Marks & Spencer and Bhs hold “more weight than any single political party leader when it comes to charting our economic recovery”.
The one executive that is seen as more trustworthy than any other is Sir Terry Leahy, chief executive of Tesco, according to the results. Ten per cent of people trust his opinions.
Collectively, Leahy and his counterparts Stuart Rose at Marks & Spencer and Philip Green at Bhs are trusted by 19% of consumers, compared with 16% who say they trust the views of the Government.
Leapfrog client services director Sarah Buckle says the research shows that brands should leverage their leaders more effectively to take advantage of consumers’ latent trust in them.
“There’s certainly an opportunity, particularly for retailers but also for brands, to be the right spokesperson in turbulent times,” she argues. “They are seen as the voice of the consumer.”
Prior to the recession, there were growing concerns among consumers that retailers, and especially supermarkets, had too much power. After all, the four major UK supermarkets – Tesco, Asda, Morrisons and Sainsbury’s – account for about 76% of the market, according to IGD.
Groups such as the anti-supermarket organisation Tescopoly had sprung up, with consumers commenting on forums back in 2007 that/ “Tesco is too big for its boots, too powerful, and too manipulative over local areas.”
It appeared that just two years ago, many consumers were questioning the power of retailers and asking if they had the consumer’s best interests at heart. So why has the recession changed people’s views of retailers?
Leapfrog’s Buckle argues that the lack of trust that consumers feel for other sectors has bolstered the retail industry’s reputation. She says: “We’ve noticed that over the past 18 months, consumers have been very critical of traditional institutions, the Government, political parties and the banking sector generally. Within that context, we’ve noticed that people are talking more positively about other sectors, particularly retailers.”
Supermarkets take the lead as the sector seen to be the most helpful to people dealing with the recession. Just over 29% say grocery stores are doing the most to help families during this tricky time. By contrast, only about 16% say they feel the Government is doing the most to help families during this current economic climate, while general retailers take just over 9% of the vote.
The older generation (55 years and over) feel that supermarkets are doing more to help than younger people do, but it appears that this age range may be more positive than other groups in general. More people in this demographic than others believe the Government is helping them through the recession too.
Supermarkets being seen to be “helpful” appears to have been bolstered by such initiatives as the increase in “value” ranges in stores. Consumers perceive this as helpful guidance on how they can practically reduce the cost of their weekly shop.
It’s not simply those on a budget who are being more thrifty, says Buckle. “It’s not just the preserve of the mainstream supermarkets now; Waitrose launched its ‘Essentials’ range this year and M&S has launched ‘Wisebuys’, for example.”
This seems to be backed up by 73% of the research respondents, who saying that the way they buy food has changed because of the impact of the recession. These people claim they are more likely to buy from a value or supermarket own-brand range to save money on the weekly shop.
Some consumers are even trading-off by switching to basic ranges in some stores in order to be able afford more luxury items. More than 16% are using this tactic so they can continue to treat themselves without straining the budget.
Almost half (46%) of people say they intend to remain bargain hunters even when the economy fully recovers, with more young people than any other age group believing they’ve changed their buying habits for good.
Buckle says this indicates that a youthful generation – used to living off credit – is learning money-managing habits from the older generations of their families. She says: “Younger people are now embracing some of the shopping behaviours of their parents’ and grandparents’ generations.”
More planning also goes into the weekly shop these days, with about 18% of people saying they now think more about what they are going to buy in advance by planning meals for the week and writing a list before visiting a supermarket.
More people claim to be cooking from scratch, with more than 20% saying they are making their own dinners rather than relying on ready-made meals.
Survey respondents also believe they are wasting less food overall, and this could be a permanent behavioural change, claims Buckle.”There’s definitely a move to buying only what you need,” she argues.
However, 19% also say they are bulk-buying to ensure they get the best deals. While consumers may claim they are buying only what they need for the week, many admit they are still tempted by deals and are stocking up on bogofs and three-for-two deals because they feel this is a way to get better value for money.
Not everyone sees the recession as a massive watershed in their consumption habits, however. A portion of the population remains defiant about the way they shop. Almost a third (about 27%) say they haven’t changed their shopping habits at all. More men than women claim they haven’t changed what they buy, with a third of men saying they haven’t changed their shopping habits versus a quarter of women.
Buckle says this could be explained by the fact that more women still do the weekly shop, so they are on the frontline when it comes to making decisions about the types of products to purchase for the household. They are more likely to be affected by the need to make cash stretch further than their male counterparts.
It appears that while many businesses have suffered at the hands of the recession, retailers have managed to walk an effective line between taking money from consumers and appearing to help them. The grocery retailers especially are on course to emerge from the recession with even better reputations than before.
WE ASK MARKETERS ON THE FRONTLINE WHETHER OUR ‘TRENDS’ RESEARCH MATCHES THEIR EXPERIENCE ON THE GROUND
Head of consumer public relations at Asda
Regardless of what the numbers are saying, the loss of trust in banks, the Government and big business isn’t something that anyone can afford to ignore.
Customers are demanding more say, more involvement and more of a stake in what they buy, how they buy it and who they buy it from. That’s why we’re trying to put customers at the heart of our business and involving them in a bigger, more meaningful way than ever before in the decision-making process, from the ranges we put on our shelves to the volumes we buy. They are dictating strategy at the moment.
We can actually help our customers save money and get the things they need at prices they can afford – and that’s where we gain our trust from customers.
One of the things customers have been telling us is that they want to spread the cost of Christmas. As well as doing special events in the festive run-up, such as our toy event where we had more than 100 lines selling for half price or less, we’re making sure we don’t take our eye off the ball when it comes to the core weekly shop.
Head of marketing at HobbyCraft
These research conclusions do more or less tally with what we have noticed. However, I think that not everything is about saving money but about a return to nostalgic activities that give people creative satisfaction.
It does surprise me [that retail leaders are more trusted than the Government]. However, there are a number of dynamic retail leaders who are well known and have been written about extensively in the media. They set out to do a job and have been instrumental in well-documented business successes.
We have certainly seen an increased interest in arts and crafts over the past five years and this interest has definitely grown since the recession. I am not sure if it is necessarily all about saving money or whether it’s more about how you choose to spend your time. Perhaps in recession we look to rediscover some of the simpler pleasures in life.
We are trying to appeal to a wider market through the concept of inspiration; it is all about inspiring more people to have a go. We do have good value offers but, more importantly, we have ideas with wide appeal and which are relevant to the season.