Wendy 00:10

Hello, everyone. I'm Wendy Liebmann, CEO and chief shopper at WSL Strategic Retail, and this is Future Shop. This is where I talk to innovators, disruptors and iconoclasts about the future of retail. My guest today is my colleague and partner in crime in all things shopper insights, our director of insights. Debbie Kelly, hello. Debbie Kelly,

Debbie 00:34

Hi, Wendy. How are you today?

Wendy 00:36

I am well, nice to see you up close and personal, almost.

Debbie 00:39

It's good to be back.

Wendy 00:40

Indeed. Lovely to have you here again to talk about our latest research. This is all about the seismic shifts that we have been seeing in our population, work that we've been doing. And, you know, some of us could say, oh, we do is talk about demographics. We talk about Gen Z, we talk about Millennials. We even talk about Gen A. How annoying are all these people? We took a slightly different tack on this, So what did we do and why did we do it?

Debbie 01:15

Sure, so one of the things we started to notice is there were some really significant shifts happening, kind of underground, if you will. Thus, the the seismic reference, we know seismic activity leads to earthquakes. So what we were really seeing has to do with the demographic makeup of a household, rather than the demographics themselves. what we did is really started looking more about who is in the household, and how does that impact how they shop. So for example, two really clear examples. One is multi-generational households, which now are growing very substantially and make up a really large percentage of total US households. We started to look more deeply into it. It's not just what you might expect, which is, hey, we know there's a sandwich generation. We know there are maybe a Millennials parents moving in with them. There's also another really interesting dynamic going on, and it's the adult, who's a young adult, primarily 25 to 29 who is still living at home with their parents. They haven't moved out for a number of reasons, and that's a really big dynamic. Out of all the multi-generational households, 1/3 of them are households that have a 25 to 29 year old. So that's a really big dynamic, and you think about how that would look different and what their needs are. So that was kind of one big question, what would that type of shift really deliver, in terms of changes in shopping, and what we'd expect, and what a retailer or brand might expect, and then the second one is the rise in single person household, so kind of the complete other side of that spectrum. And there are a couple of things that have been impacting that. One is there's been a really big difference in the average year that a man or a woman gets married. So it's a rise in about six or seven years versus, you know, 1940 so what you find is, you know, we've got some folks that are staying home with their parents, we're just talking about, and then once they move out, they may be out for a while, and it's a longer period of time. And we've also got people who choose not to get married. So in the end, 46% of adults in the US are unmarried, and that's a really large percentage, and so that is contributing to large percentage of households that are just one single person. And again, what does that really mean for how they shop and what you should be thinking about? So those are the types of things that we really want to look more deeply at.

Wendy 03:39

And I think the thing that's really interesting to me in this, and I think for those of you who are listening or watching this and have hung around with us for a long time, one of the things you know is that we don't just follow the sort of traditional trail of looking where everybody else is looking. Yes, of course we can tell you about Gen Z, and we can tell you about Boomers, and we can tell you about Gen X. Nobody talks about Gen X anymore, but we do, you know, all of those things we can we can talk about those sort of age driven segments, but it's when you look around often, looking around yourself and your own households, that you begin to recognize these shifts that are going on that have a really, sometimes unseen or unrecognized impact on the implications for everything from product size, packaging size, to stores and places that people shop. And I think that one about single person households was one of the most fascinating to me, because that's not just younger that could be older, right? So it's all single person households do not look alike.

Debbie 04:54

They do not right? You're absolutely correct. They're buying different things. They may be shopping in different places or. Some really unique differences.

Wendy 05:02

Yeah, and that's, that's a that's a really in depth conversation that is very important for us all to have, whatever business we're in, whatever category we in, because it has implications for what I choose to spend, what I need to spend on, and where I choose to spend it, or how. So, you know, Debbie, when, when you stepped back and looked at, I mean, these are national surveys that we do. Everybody knows we've been doing them for years. We do them throughout the country, or, yep,

Debbie 05:29

census balanced, right? We make sure that we're fully representing what, what's out there across the US, right,

Wendy 05:35

right? So when we began to look at that, when the data started to come back in here, and you and team started to look at it what was some of the big ahas, dare I say that showed up within those, particularly those two big segments, but I know there, there are others, there were others, but what, what were some of the things that you began to see that would impact those who are with us today.

Debbie 06:01

And so speaking about those groups specifically, one of the really interesting thing about these single person households, as an example, is they are, you know, some of these things make logical sense once you really think about them, but they are more likely to create a list before they go to the store, and they are less likely to be influenced by things in the store. And if you think about it, they have less what I will call influencers, not the kind on social media influencers, you know, the other person in the household, the child, there's nobody tugging at their sleeve. And so if you just think about that dynamic, first, you think about the fact that, okay, well, if you want to reach this shopper, where's the best place to reach them? You really need to do your work pre shop, whether they're at home or even before they think about that shopping trip, because once they write that list and they head out to the store, a lot of their decisions are made, and they're not going to be as easily swayed. So that's one of the things. The other thing is just where they choose to shop and where they're choosing to shop more. So for example, if you're looking at single person households, the channel where they're shopping the most versus year ago is Dollar. And typically, when we talk about Dollar, we tend to think in stereotypes. So someone that's shopping a Dollar store, it's somebody who is a lower income shopper, they may be struggling to pay week to week, and how much money do they have the beginning of the month or the end of the month? But one of the things that you may not be thinking about when you're just thinking in terms of traditional demographics is a single person doesn't really need large sizes of things. They are managing a budget. They've got one person in the household. It's their own income, and so it's really convenient to think about going to a Dollar store, where they offer good prices, and they also cater to smaller sizes, and that's a really good place for them to go, and it's someplace that they're obviously going even more and I think that was a really surprising dynamic for us.

Wendy 08:03

One of the things Debbie and team created in the in the in the deliverable was an infographic page. But when you look at it, and some of the things you start to see defined or honed exactly as what you were saying, Where Are They shopping more? These unique groups, younger, single person, older, single person, multi person, households. Where are they shopping more? What categories are they buying more or less? Do they have pets in the household? And, oh, 100% right.

Debbie 08:35

So what? Yeah, interesting about pets. So you were mentioning before, Wendy about how within these single person households, we've got older households and younger households, and in some areas, there's a really big difference between them. Pet is actually one of the areas where we do see a really significant difference, almost two thirds of single person households that are on that younger end. So we're talking about primarily, like the Gen Z, Millennial, to about almost two thirds of them have a pet at home. So, you know, we tend to, again, think it's stereotypes. Oh, a pet is someone you've got a big family and kids and a dog. You know, this is not exactly what a household looks like anymore. And so pet is one of the things they’re buying a lot more of, and cats versus dogs

Wendy 09:16

So that's the other the other thing that was so fascinating to me, Debbie has a dog, just so you all know, I just aspire to stealing my neighbor's cat. So that's a whole other conversation. But within that, I was fascinated as well, to see cats, dogs, and then households, and then where people are buying so that, to me, was really like, we don't tend to look at those things. If we're selling fill in the blank some other category or at some other store. Was that interesting to you? And you saw the cat versus, let's not get political about single cat, right?

Debbie 09:53

We're not going to get political or any associations. I'm not going to go there. But what is interesting. In addition to who has the captain, who has the dogs, is also some of their specific habits. So one of the things we also learned is one of the drivers of people going to pet specialty is when they get a new pet. So if you've got these folks who you know, these younger households, maybe they left home. They used to be a multi-generational household. Now they're driving their own. They make the big step they get a pet, all of a sudden they are really valuable pet specialty shopper. That is where they tend to go, particularly for a new pet, because they're looking for that expertise and all of the variety there. So there are so many things that are impacting where they are shopping.

Wendy 10:37

Yeah, that the other thing you made me think about there was, as I think, about those categories that people are willing to spend against, right? So again, household configuration, who's in that household, single to get, single older, single younger, all of these things which, seem, you know, if we observe, we know that, we know people around us, right? We don't have to look at the tons of data. We don't even have to look at our data, until you start to need to be more nuanced. But what's in that, what's in that, on that shopping list and what's not on the shopping list becomes really powerful. I was thinking about things like personal care products, and I was thinking about, you know, shampoos. I've got four different age groups in my house, and every one has a different shampoo, right? Those sorts of things that, unless you understand who's in the house, you don't know how you need to be marketing all of those products or those categories. So that, to me, is something we talked about before, but it's very interesting all over again.

Debbie 11:48

It is very interesting, and what you were talking about makes me really think about the dynamics that go on in a multi-generational household, where you have more of everything. Multi-generational households are buying more of almost every single category we looked at, they are. I think your example of thinking about a shower is a really good one. You know, we were talking to a client recently, and they were talking about a body wash brand, and saying, you know, we typically think about, oh, well, are they, you know, this brand, or do they prefer this other brand? Well, you know, what? A lot of households not only have those two brands, they might have a third or a fourth, you know, and there are certain things like personal care, where people have a preference, or, I can tell you, from having two kids of my own, you may decide that you want to spend less on, you know, a certain product where your kid is going to pump and use the whole thing up in just a couple of showers. But that doesn't mean I'm going to do the same thing for myself or somebody else in the household. Yeah. So the value of the multi-generational household, not only are they buying more, they are shopping at a higher frequency, and also across a lot of channels, yeah. And

Wendy 12:56

And I also think the interesting part about that is that portfolio of places that everybody's shopping, right? So you raise the point about single person households, maybe surprisingly more in a Dollar store, not only because of price, but also because of sizing, right? Yep. And then you start to think about, you know, if I walk into the local drugstore or the local grocery store. Do I need the 100 and whatever pack? But then you see some of those people going to the club, going to the Costco or the Sam's, and you say, wait a minute, these people live by themselves. Why are they doing that? And drum roll?

Debbie 13:36

And the answer is, we've got some folks who just really want a good deal, want to stop up, stock up, and want the trust that comes with someplace like a club store that's got really well-known high equity products that they can count on. There's something to be said for that.

Wendy 13:51

The other thing we see, particularly in the city, in in a big city like this, where people don't have a lot of storage and they're single, is that groups go or friends go to the club. They buy the big pack packs, and then they divvy them up. So maybe one social shopping, right?

Debbie 14:12

Yep, that's always a little bit different than when you're at Sephora, but exactly creative shopping. But true.

Wendy 14:16

But it is that sense of, I've got a friend, and they're yeah them, and they go to the Costco, up in, up in, wherever it is, Queens, and they buy and they share, you know, they buy the 24 pack, and they each take eight so again, it talks to the things out our I was called the mother of all our research, dear Candace Corlett, who many of you know, always says to us, look beyond the obvious and look At the small things as well. And I think that's the other piece to understand when we think about local or localized marketing, localized shopper programs and initiatives, we really do have to understand the local communities in this context of, what does the household look like? Who's in it, what are their preferences, and not assume in some of this, which I think is really important. The other thing I think a lot about is, okay, we're talking physical stores, but actually, where does digital e commerce fit into all of this? And we've narrowed that down by shopper segment, by household configuration, in this report as well, right?

Debbie 15:23

Yeah. I mean, when we're looking at things like who's shopping Walmart more frequently, we're looking at not just who's visiting the store, but who's shopping online and or in the store. So as an example, we're just talking about multi-generational households. Multi-generational households, almost half of them are shopping Walmart weekly, and so that doesn't mean they go to the store every week. To your point, they may go to the store every other week or every couple of weeks, but they're also going online, and they are finding value and convenience in places where they can kind of get more done and get more from, you know, fewer trips, and those trips don't have to be in a car.

Wendy 16:03

So it does, does talk to the complexity of all of this. It doesn't matter where you are in terms of category you're you're working in, whether you're a brand or a retailer. It feels to me like this sort of one size fits all-ness that was often, you know, the American populace. I know that's not been totally true for some time, but still, you know that everybody wants this big brand, or everybody wants the latest cool brand, or whatever in a category, be it coffee or, you know, cosmetics, that that fragmentation changes a lot, particularly in this, in this last as these, these demographic groups, change a lot through a variety of reasons. Is that, I mean, you've been doing this for a long time, is that your sense, this nuanced fragmentation?

Debbie 16:59

Yeah, I do think it is important. And one of the decisions that we made as an insights team is after really looking at how significant these differences are, we will now consider those household makeups as a traditional demographic. Every study we do, we will be collecting that information and cutting the data by those household types, the same way we would by gender or income or ethnicity and race. It's really something that we've got to start looking at on a regular basis, and not look at it just as a moment in time, but also continue to see where we think it's evolving to and how it's shifting and changing.

Wendy 17:36

And one of the other things that you brought up when we when we first published this report, was this whole conversation around the Hispanic shopper. And I know for many of us, we've talked we've said, listen, there isn't one Hispanic shopper. We have several in our team, and we know they're quite different, you know, in terms of their life, stage, lifestyle, all of the above. But what struck me in the work and the call out that you made was we make assumptions about what Hispanic shoppers sometimes do.

Debbie 18:07

So one of the things we did is we tried to scratch a little bit below the surface. And one of the things that we we realized is that the average Hispanic is about 11 years younger than the average non-Hispanic. And so what happens when you look at the data for Hispanics? If you don't try to look and break that down by generation, what tends to happen is, because there are more younger people, Hispanic data looks different, and it's really skewed because it's just younger age. And if you took, you know, for example, data on Caucasians and adjusted it to a similar profile across ages, it might look exactly the same. So people will make assumptions about things like, oh, Hispanics buy more of this or less of that. And the reality is, no, that's not true. It's just that you're looking at a younger population, and so you kind of have to normalize that, and you realize, oh, okay, well, you know what, it's not that they buy less vitamins and supplements or less of some other things, like OTC medications. That's really not true. When you break it down by generation, it looks exactly the same. So it's making sure to really dive deep and understand what could be real, and what might not be real. And this is going to become even more important. So one of the things that that we're seeing over time is a huge increase in the Hispanic population. They represent about 19% of the population right now. And what's also happening a lot of people, again, thinking in stereotypes. A lot of people tend to think, oh, there's tons of immigration. The Hispanic population is going to continue to grow. And although that may be true, the majority of the growth of the Hispanic population that's happening now and projected to happen over the next number of years, is actually through birth rate. So Hispanics are having more children on average, than non-Hispanics. And so when you think about the fact that there's 19% percent of Hispanics in the US population. Now, if you look only at children, Hispanics make up 26% of the population. So think about what happens if they've got more kids and they continue to grow, not only do they continue to be really important, but you just have to be that much more mindful about making sure that, again, you're really looking below the surface and making sure, just because you know, your bubble of lots of younger people who have an age yet isn't necessarily going to cloud

Wendy 20:28

yeah, and then there could be still at home, multi-generational, or they can be single. It's the overlaying of this so important, right? We shared some of this with one of our clients recently. And this is a pretty sophisticated, big, global company, and I remember the president, the president of North America, saying, you know what? We are looking we've created all these segments that we are looking at for the future growth for the next 5-10 years. She said, we're not even looking at household configuration. We are looking, yes, we look at number of people who live in the household, but we're not that's just sort of in the sort of broader terms. We're not really understanding these kinds of nuances. And what struck me about that was not that they weren't, that was interesting by itself, but that we're all and you and I hear this all the time. Our whole team does this. This just worrisome issue around traffic, in stores, around volume, all of these things. And yet, here are these, if understood, these opportunities by looking at the population in real terms, really how they live, not how we think they live, and the ability to target both product, size, where they're sold, how they're it's just a massive opportunity. So I, you know, I don't know. My frustration is that we're looking for growth. Well, guess what? It's right in front of us, if we look more closely. Yeah.

Debbie 22:03

I mean, one of the things, I think, is a natural response to hearing about single person households is, well, you know, they don't buy as much. There aren't as many people, but one of the things we do see with single person households is, if they have extra money, they're more likely to spend it versus save it. They're more likely to splurge on physical items versus experiences. So they're not solely going and traveling, you know. And so do you have physical items you want to sell them, you know? They are open and they're willing to spend. They're not squirling away all their money. We also see, and this is, this has come up in a couple of studies, and we're seeing it again, particularly with single person households, those younger ones, they also are really interested in treating themselves and treating themselves well. So what that means is, even if you have a budget, you want to treat yourself, and that's something that's very important to people. So, you know, it's just, how do you there's many different ways to skin,

Wendy 23:02

yeah, yeah, I'm always again. Sometimes the opportunities are right in front of us. And I think about the focus of how people are thinking about and wanting to take care of their own health looking at these as new demographic segments, not just the typical age, income, ethnicity. And then the newer work we're doing, where we're talking about, how do we think about trust, and how are different groups in the population really what's important to them when they go to buy products, goods and services? So this whole continuing story from our How America Shops® Was there one thing beyond cats and dogs? was there one thing beyond cats and dogs? Was there one thing beyond that, that just, you've still been noodling on, that you're thinking about?

Debbie 23:53

One of the things that really surprised me, it was one of those moments where you stop, stop and really think about how much has changed. So we were looking at the dynamics of shoppers across different channels, and of those shopper groups, shopping, each of those channels are key accounts, what percentage of those are weekly shoppers? And what we saw was that Walmart has a larger percentage of weekly shoppers than a supermarket does. And when I thought, wow, you know, when you think about, where do people go every week we're all trained to just think it's the supermarket. And that really made me stop and think, you know, this is really a very big shift, you know, and what does that mean for kids growing up in a household now, and where they think their weekly shopping would be done. And again, let's remember that weekly shopping may not necessarily be, you know, getting in your car or taking, you know, transportation to get to the store. Part of that is the ability to do online and offline. With Walmart being so dominant in that area, it also just really made me think about how well. They're doing with, you know, doing they put a lot of focus on seamless integration of online and offline. And so, you know, when we think about your shopping experience and where you're going to shop, one of the ways that you can increase the frequency of people shopping is to get them whether they want to be shopping online or in person, yeah. So that was a really big aha moment, yeah,

Wendy 25:19

And I do think that as a sort of closing thought is so, so powerful, because we do think about, or we need to rethink, that sort of old world of what's the frequency people are everywhere is the drugstore, the place that people go once a month to get a prescription, once every three months to refill a prescription, and that's the major driver or is it actually the daily. So to think about sort of wrapping up here, one of the things that really strikes me about this, and you said it in a few different ways, is, for most of us working in this space, there are these sort of precepts of who, who we look at, how we look at them, and also how we look at the places they go to shop, and that notion of Walmart being the weekly place now we get the kind of weekly stock up, but, or the weekly grocery, but those Walmarts aren't necessarily on the corner near the grocery store in the city or the suburbs. So, the implications for the grocery store, the implications for the drug store, where you know, traditionally it was you go once a month to get a prescription refill, or once a quarter to get a prescription refill. I don't know, is it the daily store now, you know, you pop in to get the milk, the candy, the all of those things. I just start to think again about that sort of kaleidoscope of rationales that we thought about when we thought about our shopper insights work, our shopper marketing work, our brand building, our package size, our the shelf configuration, all of those things now that you talked about seismic shifts, yeah, at the very beginning, yes. Feels like, there's a lot going on under there's, there.

Debbie 27:10

There is a lot going on. And, you know, another shameless plug for something that we've got coming in the next round of research as well. You know, I mentioned the notion of Walmart and the whole idea of being online offline, and you were talking about, you know, what can I order every day? One of the things that we're looking more deeply at in this next study is looking at Walmart Plus as an example, and looking at how are shoppers using Walmart Plus versus how they use Amazon. How is it similar? How is it different? We know Walmart Plus has been really successful in giving Amazon a run for its money, and we really want to get a better understanding of those households and how they're utilizing them, and how they're perceiving them. So that's more good stuff to come.

Wendy 27:53

While I was talking to Debbie, my doorbell rang, and of course, that was my grocery delivery just being dropped at the door of my apartment. That doesn't mean I don't go to a supermarket. I do. If we stop to think about what our own household configurations look like, or our friends and neighbors and families and grandparents and whatever, we would have great insight into where some of these opportunities are really emerging. So for those of you who are complaining about volume, traffic, all of those things. Pay attention. There's more on this for any of you at our website, and there's more on just ask us, we're here. Thank you. Debbie, as always, we look forward to your next visit to the future.

Debbie 28:36

Thanks for having me.

Wendy 28:37

Cheers for now.