Power of major supermarkets a concern to shoppers: survey

Posted by Daniel Palmer on 9th July 2009

A new survey has indicated growing skepticism of the major grocery chains, with Consumer Affairs Minister Craig Emerson today indicating he was hopeful the proliferation of Aldi stores and the introduction of Costco will shake up the sector.

Speaking following the release of a survey of Adelaide and Sydney mothers by Heartbeat Trends that suggested growing discontent with Woolworths and Coles, Dr Emerson told Sky News that, when it came to supermarket operators, his view was “the more the merrier”.

“The Government will continue to remove barriers of entry in supermarket retailing,” he added, saying steps were being taken to remove anti-competitive features of local planning regulations in all states and territories.

Those surveyed reported concern that Coles and Woolworths had too much power in the marketplace and were showing greater support for local markets and Aldi (Sydney respondents only, as Adelaide is yet to see its first Aldi store). They were also looking forward to the entry of Costco – even though the American retailer has yet to even find a site in Sydney or show any interest in Adelaide.

The groups also admitted to greater anger if something went wrong a Coles or Woolworths store – such as enduring a long queue.”Consumers were more than happy to offer their views on Coles and Woolworths, and not in kind terms,” Neer Korn, a Founder and Director of Heartbeat Trends, advised, according to the Sydney Morning Herald. “(Respondents) had a strong sense that what they didn’t want was the feeling of ‘being had’, and they were prepared to drive the extra distance if it made them smart shoppers.”

A recent Roy Morgan survey into the satisfaction of shoppers with regard to IGA, Aldi, Coles and Woolworths indicated that the gap in satisfaction between the four may, in fact, have narrowed over the past six months. It should be noted, however, that all four witnessed declines in customer satisfaction levels in the six months to the end of April, with Aldi at 89% followed by IGA (86.2%), Woolworths (85%) and Coles (84.6%).

Downsizing not well received

Smaller portion controlled products were also causing angst amongst shoppers, with Mars singled out following the recent cut in size of the iconic Mars Bar. The company said the 11.6% reduction was in response to the obesity issue, but respondents in the Heartbeat survey did not see it as a positive.

As noted in an article on Australian Food News earlier this week, the cost cutting strategy of downsizing is fraught with danger as consumers need to be convinced the smaller size is offering them a real benefit.