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Consumer Research

Consumer Research in modern Australian grocery retailing


As consumers change the way they shop, e.g. using smartphones, then the types of research undertaken should also change to better understand consumers. Traditional research methods may not accurately capture the necessary information in a timely manner. Are current research methods, e.g. scan / ‘big data’, the best option to create personalised experiences for shoppers?

Very, very brief history of market research in Australia

A very quick overview of market research in Australia, based on an excellent review written by Mike Larbalestier, Past Chairman of AMSRS (Australian Market & Social Research Society) would be:
• Market research started in the UK with social survey research e.g. Mayhew’s “London Life and London Poor” (1851)
• European mathematicians developed sampling theory in the late 1800s, early 1900s
• Australia’s first recorded consumer study was in 1929, completed by Rudi Simmatt of J Walter Thompson. J Walter Thompson was a training ground for Sylvia Ashby and Bill McNair.
• Bill McNair initiated the first studies of radio audiences in Australia in 1934
• Sylvia Ashby opened the first independent market research company in Australia in 1936
• Roy Morgan Research Centre was established in 1941 to conduct Gallup Polls

Now, 100 years after consumer research started in Australia, research in the retail industry has developed into a data and insights driven tool to deliver instantaneous understanding of consumer and shopping behaviours.

Traditional consumer research methods weaknesses

Traditional research was primarily completed face to face. Research methods commonly used in the retail industry, such as focus groups (qualitative) and surveys (quantitative) are still used in Australia today by many companies. This research can be apt for some specific types of research e.g. NPD (new product development). Traditional research methods have 2 major weaknesses vs some current research methods:
• Time
• Data Quality / Cost

It is normal for a traditional research project to take months, from defining the question that needs to be answered through to the presentation of results. After the results are presented then the company can use these insights to create an action plan.

Due primarily to cost restraints traditional market research was completed with a small group of consumers, e.g. 4 * focus group with 6 people per group, and / or in store survey of 100 people. Researchers would screen potential respondents, to ensure they represented the target market, to try to ensure this small sample size would reflect the target market in general.

Market Research Process

Market Research Steps

Current research methods in the Grocery Industry

In addition to traditional research methods, such as focus groups and in store surveys, Australian retailers and suppliers also use other data sources to try to understand consumers and shoppers better. Some ‘modern’ research methods are actually traditional research methods, that are now completed by utilising new technology and larger data sets, e.g. online survey rather than an in-store survey.

The major change in ‘consumer research’ today is that nearly all steps in the purchasing journey are being researched / analysed. This in-depth research of all touchpoints / customer experiences should lead to a greater understanding of consumers and shopping behaviour but it can also create an excessive amount of data, for retailers and suppliers, that can be difficult to manage and draw actionable insights from.

Some retailers and suppliers now break ‘consumer research’ into specific research areas. ‘Shopper research’ focuses on how the product / service is purchased in store. The shopper buys but may not consume the product / service. ‘Consumer research’ focuses on the expectations and actual experiences of people that consume / use the product / service. With increasing online sales e-commerce specific research is also completed now.

Stock Availability

Research into the grocery industry, in Australia and overseas, has highlighted that consumer expectations are still not being met due to items being out of stock in store. For example, the 2017 Canstar Blue Supermarkets survey highlighted the second major issue with supermarkets is:

Items I want being sold out / unavailable, 18% respondents

The grocery industry in Australia is aware of the issue and more meaningful data is now being shared. For example Woolworths Voice of Customer (VOC) results include results for availability. According to Woolworths 2017 annual report ‘On-Shelf availability and Fruit & Vegetables remain our biggest opportunities for further improvement.’

To address this issue retailers and suppliers will have to share more real-time information, from all steps in the supply chain, to ensure consumer expectations are met. Traditional measures like DIFOT (delivered in full on time) only measure stock availability at the warehouse / DC, not at the key place of on shelf in store. ad

Scan Data

Scan data (EPOS) is the data that is collected in-store when items are purchased. Historically this sales data was used by replenishment teams for stock ordering / forecasting etc. For some time this data has been used to get a better understanding of how consumers react to changes in retail price changes (including promotions) and to evaluate changes in ranges, POGs etc. The major advantages of this data set vs a traditional research is that all purchases are recorded (larger data set) and actual purchases are recorded rather than potential purchases.

Panel Data

Panel data adds more depth to scan data as consumers household information such as the age of the consumer and the number of people in the household is recorded. In the Australian grocery industry, Nielsen Homescan and IRI shopper panel are generally used.

Historically this data was captured in the home by members scanning their purchases but now it can be captured at point of purchase via credit cards and loyalty cards. The major advantages of this type of data vs traditional research is that more purchases are recorded (larger data set) via a longitudinal study (not a once off snapshot) and actual behaviours are recorded rather than potential behaviours.

Australian retailers are using panel data to test new products. For example in October 2015 Aldi launched its ‘Testers Club’ and in 2016 Woolworths started developing ‘The Bunch’ that went live in 2017. These panels are examples of how traditional research is now completed by utilising new technology and larger data sets. Historically, a market research agency would select participants to complete a taste test on a particular day/time at a certain location. The findings would then be presented to the client at a later date. Now Woolworths has a panel available (The Bunch) and they can pick up the free sample to be tested at their local store, try the sample at home and then complete an online survey.


The internet offers Australian retailers and suppliers a large number of different, generally cheaper, ways to complete consumer research. Some examples include:
1. Online surveys. There are numerous software packages available now so Australian retailers and suppliers can quickly complete online research, generally cheaper, than traditional research methods such as in store surveys. Surveymonkey is an example.
2. Google. Google Australia communications manager, Camilla Ibrahim stated “Fidget spinners were the toy craze of 2017.” If a toy retailer was not ranging fidget spinners because it was not a top selling SKU in historic scan data then they missed a major opportunity in 2017. Also one of the top 10 google Australian searches for 2017 was Amazon Australia site.
3. Social media. There are numerous sites e.g. Facebook, Youtube, Instagram and Twitter where consumers and businesses can express their opinions on products / services. According to Facebook Australia had 15 million active monthly users in 2017. In September 2017 an upset Coles customer uploaded a video to Facebook of people buying baby formula, allegedly to be on-sold in China, so she challenged Coles to ensure stock availability for Australian consumers.

The Internet has created many new ways for Australian retailers and suppliers to complete consumer research quickly for a low cost. Very importantly the Internet has changed consumer research by giving consumers a new way to express their ideas / opinions about a product / service or company to a wider audience quickly without the retailer or supplier instigating a ‘research’ project.


As more consumers research and buy products online, e-commerce research is becoming more important. Roy Morgan research estimates that 2,100,000 million Australians bought Food and Beverages online per 4 weeks in 2016, up 67% or 851,000 people since 2013.

(Source: Roy Morgan Single Source (Australia), Jan – Dec 2013 (n=18,576) and Jan-Dec 2016 (n=14,330)

Canstar Blue Online Grocery Shopping 2017 survey highlighted that 22% of online grocery shoppers do all of their grocery shopping online today and 42% expect to do all of their grocery shopping online in the future.

The addition of e-commerce to in store purchases means retailers and suppliers now have to collect different types of data from another type of shopping experience. For example, what percentage of orders are delivered in full, on time (DIFOT) to the shoppers home? How many SKUs have to be substituted due to out of stocks in store?

Current Research Methods Weakness


Due in part to new technology and consumers demands changing, the retail industry is now focusing on delivering personalised solutions to shoppers. PwC in the Digital Pulse article, Retail Trends 2017: What is digital’s impact on the retail sector? define retail personalisation as:

“contextualises and responds to the individual user based on their personal needs and preferences. Using data analytics to not only respond to but anticipate customer needs is the next step on from that.”

For example, Amazon will make product recommendations to their customers, whilst they are shopping, based on that individuals past purchases or recent product searches.

So the major weakness current research methods, e.g. scan and panel data, have is that they use larger data sets to focus on top line numbers, e.g. total sales, and group similar / like customers into target markets but consumers expect a unique personalised offer now. For the data to be used to create long term relationships with shoppers it needs to be focused on individuals, not large groups. Considering the amount of money Australian retailers and suppliers have invested into ‘big data’ already and the plans to invest more the industry needs to consider how best to invest this money.

To meet the emerging demand for personalisation a shoppers’ purchase history needs to be analysed in real time to make personalised recommendations at the time of purchase. This could occur in store, e.g. smartphone, or online. For this to be achieved retailers will need to invest heavily in new technology e.g. AI. This means the focus of research will move from retailers and suppliers analysing ‘big data’ to grow the category to computers using ‘personal data’ to make individual recommendations and grow the relationship with the shopper and consumer. This is a fundamental change in how retailers and suppliers have traditionally met shopper demands. As the technology evolves other data sources, e.g. recent online product searches, shall be included into the data to deliver the personalised offer consumers are now expecting.


All research methods will have their advantages and disadvantages. This brief article has highlighted that the Australian retail industry is using traditional and new research methods to better understand all aspects of the shoppers and consumers experience. The general trend in the research is to capture more data, from more touchpoints in store and online, and then use technology to analyse to shoppers and consumers to get a greater understanding of their behaviours.

Traditional consumer research was designed to ensure that the expectations of consumers were met / exceeded. Some people may refer to this as ‘product / brand research’. The majority of this research was completed face to face in focus groups or completing in-store questionnaires.

More recently, with advances in technology, more research is completed online and / or with ‘big data’ sources such as scan. These methods are generally quicker and use larger samples of respondents. The research is being broken down into specific areas, e.g. shopper research, consumer research and online / e-commerce to get a deeper understanding of consumers. These changes have addressed some of the weaknesses in traditional research methods.

With more data being captured about how people shop, products / brands they prefer, online searches etc there is an increasing expectation from shoppers and consumers that retailers and suppliers will be able to meet their personal expectations, but many current research methods are focusing on larger sample sizes to better understand ‘the market’ and are not focusing on the individual. As consumers now expect personalised offers, so research methods must focus on understanding whether retailers and suppliers are building long term relationships with individuals. Technology will be an important part of this change.

The information provided in this blog post was general in nature. If you require more information I offer a free initial consultation by completing a contact us form.

Thank you,

Tim Bowen