why value matters

03/18/2005 09:14:00 PM
If anyone was questioning Americans desire for a bargain, they need look no further than a recent study from NOP World. The study creates a global bargain index based on responses to two questions; "I feel really satisfied with myself, even excited, when I get a good deal" and "I always try to buy things on sale". Americans scored 24% higher than the global average. Most consumers around the globe were excited by the prospect of finding a bargain, but not everyone had the chance to buy things on sale. For, America and Brazil, the global leader for bargain hunting, over 75% of people always try to buy things on sale.

At the bottom of the bargain seeking pile are Japan, Russia, Poland and Hungary, where sales are hard to come by and when found, cannot be relied upon.

Price and value are clearly needed to be competitive, a theme echoed in a recent paper "Competing in a Value Driven World", published by McKinsey.

Some of the highlights include:

- Value driven grocery retail increased share from 21% to 25% over the period 2001-2004

- By 2015 Wal-Mart will have captured almost a 20% share of grocery retailing in every state

- Location as a barrier to shopping at value driven retail is declining in importance

- Traditional grocery retailers need to develop differentiated brands in order to compete
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