What the future has ‘in store’
BELLEVUE, Wash. The Hartman Group is teaming up with GfK Custom Research North America on the launch of a new syndicated study, called Future Buy, to depict what retailing strategy will look like in the future as American shoppers emerge on the other side of the current economic crisis.
The overarching goal of the Future Buy Shopper Innovation study is to define the new meaning of “value” and determine what broad cultural values now influence and impact the way people live, shop and use products — and will in the future. “There are some obvious components of value [around which] consumers have historically defined [value],” Michelle Barry, SVP of the Hartman Group, explained to Drug Store News. “Quality, quantity and price — that’s the triumvirate that’s been predominant as consumers think about what does value mean across categories.”
The premise behind the Future Buy report is to ascertain whether that traditional definition of value has expanded or shifted within consumer minds by tracking their purchase patterns — where they buy, what they buy and how much they buy. “What we’re trying to understand is price and convenience and some of the more pragmatic, traditional notions of value more important to consumers right now during an economic crisis than more emotional, entertaining [and] experiential dimensions,” she said. “And, if so, is this a long-term trajectory?”
As of press time, the Hartman Group and GfK were only a few weeks into the project. But some of the early learnings included that, regardless of actual income, consumers are more and more becoming thrifty shoppers. “We’re seeing that play out in a couple of ways,” Barry said. “As a coping mechanism, finding that bargain actually generates a buzz, allowing consumers to relax. It ameliorates that sense of anxiety and concern about the economy as a whole.”
Accordingly, shoppers are more and more looking for deals on quality products, and they’re looking for those deals online. And not necessarily in the traditional sense, where consumers might go to the Web sites of their favorite products in search of an online coupon, Barry reported, they’re creating and utilizing local online shopping support groups. “They’re very local groups, grassroots, where [consumers] get online and start talking about [where sales or coupons can be found],” Barry said. “It’s not happening on Myspace or Twitter as much as its happening among these indigenous groups — they’re all over the place and very local,” she said. “They’re a little hard to find and tend to be in [urban locales] … where there is a broader choice of retails [from which] to choose.”
Additionally, consumers are not necessarily open to trying new products or brands these days, instead relying on products and brands they know will deliver a good experience. “They’re really sticking with the familiar — that tried and true product with brands they already love,” Barry said. “They’re not trading down from quality … instead they’re taking some different approaches to shopping for quality products.”
That suggests shoppers are increasing the frequency of trips, buying less each time as compared to trips prior to the economic woes, and they’re increasing the number of channels in which they shop. “We’ve seen the multichannel phenomena really expand, much more so than we would have predicted,” Barry said.
The study will be available July 2009, Hartman Group and GfK have reported.
Kroger to serve as exclusive supermarket sponsor of Fiesta Atlanta ’09
ATLANTA Kroger will serve as the exclusive supermarket sponsor of Fiesta Atlanta ’09, an outdoor Cinco de Mayo festival celebrating Latino culture, music and food.
Fiesta Atlanta ’09 takes place on Sunday, May 3 at Centennial Olympic Park in downtown Atlanta. For Kroger, the partnership represents the company’s commitment to the Hispanic community.
“We are very excited and looking forward to Fiesta Atlanta,” said Glynn Jenkins, director of communications and public relations for Kroger’s Atlanta Division. “Kroger has always made exceptional efforts to serve the Hispanic community and joining this celebration is another commitment to our Hispanic customers.”
Atlanta’s largest Hispanic outdoor family festival, Fiesta Atlanta attracted over 40,000 attendees last year. This year’s event will once again feature authentic food from many Latin-American countries, arts and crafts, sponsor displays with many free product samples and continuous live musical performances by national and local recording artists.
AARP cites big jump in Rx prices
NEW YORK A report by AARP indicated that prices for branded drugs have increased at a rate outpacing the rate of inflation by more than six percentage points.
The report found that manufacturers’ prices for branded drugs increased by 9% last year, compared with the general inflation rate of 3.8%. Meanwhile, prices of generic drugs decreased, on average, by 10.6%.
Generic drugs have already grown significantly over the years, accounting for 69% of all prescriptions dispensed in the United States, but 16% of money spent on prescriptions, according to IMS Health. In 2007, according to the National Association of Chain Drug Stores, the average price of a generic prescription drug was $34.34, compared to $119.51 for a branded drug.
Price increases for branded drugs significantly higher than the overall rate of inflation, mixed with the recession, are likely to drive more consumers to generics. According to AARP, nearly a quarter of all older Americans skip medication doses because of the cost, while other studies have shown that many Americans facing economic hardship don’t have prescriptions filled at all.
At the same time, many branded pharmaceutical drugs – not to mention biologics – don’t yet have a generic version. This could create difficulties for elderly and other patients who may be able switch to medications that are cheaper, but different from what they take, or who take biologic drugs or newer drugs that have no equivalent on the market.
The Generic Pharmaceutical Association said the report indicated that generic medicines are “the right choice for better health.”
“During these difficult economic times, it is truly disturbing to hear reports that our nation’s seniors cannot afford their prescription drug costs,” GPhA president and CEO Kathleen Jaeger said in a statement responding to the report. “No one should be forced to choose between putting food on their table and paying for needed medicines.”
Jaeger also said the report illustrated the need for a regulatory pathway for biosimilars.
“It’s time to do right by our seniors and all Americans struggling with healthcare costs by approving legislation that brings safe, effective and affordable biogeneric medicines to patients sooner rather than later,” Jaeger said. “GPhA also strongly believes that increasing funding for FDA would ensure the more timely approval of generic medicines, increasing the opportunity for consumers to save immediately.”