Tuesday October 8th, 2013 - 2:57PM
Dollar stores are not just for lower income shoppers anymore, according to research published by Mintel. In a recent study by the market research firm, 10% of respondents from the highest-income households designated, earning $150,000 or more, said they are shopping at dollar stores more often while only 8% of the lowest income echelon, households earning less than $25,000 annually, said the same.
Younger men and women, aged 18-34, are more likely than those in other age groups to say they are shopping at dollar stores more often this year than last, with 33% of men and 31% of women in the age group saying so versus 24% of all respondents, according to Mintel.
"Younger consumers are an important group to target for dollar and discount stores. This group is likely to be from lower-income households as many may be students and others who are starting out in their careers and could benefit from the discount prices and convenience of these venues," said Ali Lipson, retail analyst at Mintel, in helping announce the research.
Dollar stores have multiple advantages, respondents to the Mintel study said. Location is one, as 78% of dollar store shoppers said that the operations are conveniently situated, making them easy to shop, and 74% think dollar stores offer better prices than other retailers. Convenience and price aren't the only features driving consumers to these retail havens, Mintel maintained. The stores are pleasant to shop, said 59% of Mintel respondents. Meanwhile, 54% said brands and products sold in the channel are just as good as those found in other retail sectors.
Among the highest earnings, 60% agree that dollar stores have better prices than other retailers, but only 34% of the most affluent consumers found dollar store brands and products as good as those offered at other retailers compared with 64% of lower-income consumers.
"Dollar and discount stores benefit from continued consumer caution regarding spending, as well as an improved level of acceptance and satisfaction of the products offered and the shopping experience in these channels," Lipson said. "However, some consumers do have a perception of lesser quality offered at these retailers, thus choosing other channels over dollar and discount stores. In order to reverse this perception, dollar and discount stores need to promote brand name offerings to those who are unaware that well-known brands are offered at these stores. "