Survey to help retailers find their roots

The report provides factual information relating to particular target market routines, habits and lifestyle. John Bowles, Joint Managing Director of NAB, explains that retailers hoping to secure their fair share of disposable income need to understand the dynamics of the community in which they operate. "Roots 007 is a comprehensive study of economically viable areas countrywide, that can provide a wealth of statistical information and insights to guide any retail decision," he says.

Breaking down the four poles of Gauteng and researching individual suburbs within these areas, Bowles says that a comparison of the priorities and spending power of Purchasing Decision Makers (PDM's) interviewed, differ completely from one suburb to another. For instance, more than half of Krugersdorp's PDM's prefer to do their grocery shopping on a weekend.

"This trend is pretty stable across the entire West Rand, with Roots 007 determining that 57% of Randfontein residents and 64% in Roodepoort do the same," he says.

"Big" shoppers vs. weekenders

Digging deeper into West Rand pockets, the vast majority of these inhabitants plan their 'big shop'. "The statistics speak for themselves," says Bowles and explains, "Percentages across the suburbs of Krugersdorp (42%), Randfontein (49%) and Roodeport (42%) prove this trend among PDM's interviewed." Over 30% living in these three suburbs have school-going children and the majority earn between R12,000 and R24,999 per month. It is also interesting to note that their retirement statistics include Krugersdorp (19%), Randfontein (21%) and Roodepoort (15%).

"Although there are some similarities in these areas, PDM's priorities and what they do with disposable income differ greatly," says Bowles. This is seen clearly when comparing the number and type of 'techno' items appearing in each home. Roodepoort sees 86% of its households sporting a music system, while only 45% in Krugersdorp have the same.

In comparison, a whopping 73% of Johannesburg South's residents are weekend grocery shoppers and 63% do one bulk shop a month, with a few 'fill-ups' along the way. A staggering 82% own their own homes, while 57% bought or looked for small electrical appliances within the last twelve months. "Furniture retailers positioned in the South are in the right place," says Bowles and backs his point explaining that 45% of residents bought or looked for furniture in the same period. While only 23% of PDM's use email or Internet at least once every two weeks, 81% own a DVD player and 83% have a cell phone. "The majority of bread-winners in this circle earn between R12,000 and R24,999 per month and 35% have completed Matric," he adds.

Impacts of household income

An interesting observation of the East Rand population is that of household income. While 19% of Brakpan residents earn between R4,000 and R7,999 per month, only 7% in Bedfordview/Edenvale earn the same. "Instead, 5% of this community earns over R51,000 per month, while no-one interviewed in Springs earns within that high-end salary bracket," he adds.

In terms of racial breakdown, Roots 007 showed that Kempton Park has a 36% black population, Alberton has an 9% coloured population, Brakpan has the highest Indian population (8%) and Bedfordview/Edenvale has the highest white population (81%) in the East.

Kempton Park residents scored the highest when it comes to full-time employment (69%), compared to only 50% in Brakpan. Springs showed the lowest percentage of students (1%), while Benoni had the highest (4%). "In terms of techno items, 55% of the Boksburg community own four or more, while only 27% of residents in Germiston own the same."

"Retailers should be aware of the bottom line," says Bowles and explains that those wanting to target the East should also note that 57% of Bedfordview/Edenvale PDM's bought or looked for audiovisual appliances within the last twelve months, while only 21% of Benoni residents saw this as a need. Germiston residents are the highest consumers of soft furnishings with 41% purchasing curtaining, bedding and towels. "The purchasing of outdoor equipment saw one of the most remarkable differences," he says. While 8% of Bedfordview/Edenvale residents bought outdoor goods in the last twelve months, only 1% of Springs residents did.

Know your market

"This proves a simple point. Retailers need to access our research into the spending habits of the communities in which they operate. How else will they know that 59% of Boksburg residents bulk shop once per month, while 52% of the Bedfordview/Edenvale community shop twice a month or more."

Shoppers living in different suburbs in the north of Johannesburg are also not a homogenous group of people. There are significant differences in demographics and lifestyle which retailers need to consider. "It's easy to assume that people who live in Fourways, Randburg, Sandton and Northcliff are similar, but the survey warns that these assumptions are dangerous," says Bowles. He explains that a comparison in home-ownership and home-improvement trends show that only 75% of Fourways residents own their own home, compared to 91% in Northcliff.

In Fourways 58% of PDM's have four or more techno items, while 44% of Northcliff residents have spent money on these items in the past year. "This alone suggests that these two groups have very different needs and aspirations," says Bowles.

Roots 007 also has the ability to dissect family situations and has determined that Northcliff residents have the highest percentage of grownup children living outside the home (21%), while in Fourways, 18% of PDM's have children under the age of six and is also the suburb that has the highest percentage of singletons with no children (40%).

Sandton residents tipped the scales when determining the monthly paycheck and sees 13% of residents bringing home more than R51,000 per month.

"Retailers clearly need to do their homework when choosing a community and site in which to base their store. The correct positioning is key, as we already know that the vast majority of people conduct the greatest percentage of their 'retail therapy' close to home," Bowles concludes.

For more information on the Roots 007 survey, visit: http://www.nab.co.za/