Foot traffic at dollar stores continues to grow, but consumers are looking for a broader selection of products from retailers in the channel along with an improved shopping experience, recent insight from ChaseDesign shows.
In its Dollar Store Channel Survey, Chase found that consumers have specific needs and wants when shopping the likes of Dollar General, Dollar Tree and Family Dollar. In the survey, 51% of respondents said they are looking for more fresh and frozen food products while 35% are seeking additional choices in beauty and personal care.
“Where people buy their groceries today is evolving quickly,” said Joe Lampertius, president of ChaseDesign. "Dollar stores are getting an increasing amount of their sales from packaged, fresh and frozen foods, and they’re capturing those revenues from traditional retailers like supermarkets and mass merchants. This emerging competition needs to be top of mind for those retailers as they strategize how, when and where to engage their shoppers.”
While inflation has driven more shoppers to dollar stores as they seek to save money, the continued growth of retailers in the channel has also brought them closer to consumers. Lampertius noted that Dollar General has added more than 1,000 net new stores in each of the past four years, and Dollar Tree and Family Dollar have averaged more than 100 new stores per year over that same period.
As foot traffic increases at dollar stores, consumers are also looking for an enhanced shopping experience. In fact, 72% of survey respondents mentioned lack of organization, navigation and clutter/cleanliness as the top reasons they find shopping at Dollar Stores a challenging experience.
“A key challenge retailers in this space need to overcome is the way their stores are organized and how categories are presented, as many customers find the experience challenging to navigate,” said Lampertius. “In fact, nearly three-quarters of respondents mentioned lack of organization, navigation and clutter as a challenge to their experience at dollar stores.”
Notable takeaways from the survey include:
- The most frequent shopping trips to dollar stores are fill-in and immediate need.
- Typical transaction in the dollar store channel is $25 or less.
- A majority of shoppers never use dollar store retailers’ apps; 15-22% (20% avg.) didn’t know the stores had an app; 35-70% (46% avg.) never use their website (browser).
- Shoppers say Dollar Tree is the easiest to find items, while Dollar General is the easiest retailer to find items online and in the app.