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Expansion Of Non-Traditional Food Retail Outlets: Effect On Consumer Welfare

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  • Morganosky, Michelle A.
  • Cude, Brenda J.

Abstract

In this study three different methods of data collection (telephone interviews/focus groups/on-line consumer surveys) were used to assess the impact of non-traditional retail outlets on consumer welfare. We analyzed consumer cross patronage between supermarkets and nontraditional food retail channels, examined reasons for cross patronage, and made a preliminary assessment of consumer response to one of the newest retail channels: on-line food shopping. Telephone interviews were conducted in a medium-size market with 300 individuals and focus groups were conducted in two major metropolitan markets and one medium-size market. The on-line survey consisted of responses from 243 on-line food shoppers in six different markets. High levels of cross patronage were identified between supermarkets and non-traditional food retail outlets with the highest between traditional supermarkets and supercenter formats. A primary objective of the focus group interviews was to learn how consumers incorporate nontraditional retail formats into their grocery shopping. Focus group participants indicated they add these formats to the existing mix of stores from which they shop. Despite the increased number of types of food retail outlets they patronize, most focus group participants said they don’t feel they spend more time grocery shopping now than before. None of the focus group participants had purchased groceries from on-line services. Therefore, we collaborated with a major supermarket chain offering on-line grocery shopping to survey consumers that were actually buying groceries on-line. Convenience was the primary reason given for shopping online but a significant segment mentioned physical and/or constraint issues as a major factor. A fairly small but interesting group said their primary reason for using on-line services was to avoid going to the grocery store because they “hate shopping” and “hate grocery stores.” Of all the retail outlets examined in this three-part study, on-line shopping appears to meet the specific needs of consumers in a way that is different from that of the other retail outlets. Implications for consumers, retailers, and public policy makers are discussed.

Suggested Citation

  • Morganosky, Michelle A. & Cude, Brenda J., 1999. "Expansion Of Non-Traditional Food Retail Outlets: Effect On Consumer Welfare," New Economic Approaches to Consumer Welfare and Nutrition - FAMC 1999 Conference 260300, Food and Agricultural Marketing Consortium (FAMC).
    • Handle: RePEc:ags:famc99:260300
    DOI: 10.22004/ag.econ.260300
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    References listed on IDEAS

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    1. Kaufman, Phillip R., 1996. "What'S Driving Food Distribution - Forces For Change," Journal of Food Distribution Research, Food Distribution Research Society, vol. 27(1), pages 1-5, February.
    2. Jean Kinsey & Ben Senauer, 1996. "Consumer Trends and Changing Food Retailing Formats," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(5), pages 1187-1191.
    3. Kaufman, Carol Felker & Lane, Paul M & Lindquist, Jay D, 1991. "Exploring More Than 24 Hours a Day: A Preliminary Investigation of Polychronic Time Use," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 18(3), pages 392-401, December.
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