Shoppers are prepared to drive around looking for the best value and discounts for food and groceries

It was once the convenience and location of a supermarket that pulled in shoppers, but now cost of living pressures is seeing shoppers hop in the car and drive further to get a bargain.

Coles boss Leah Weckert says that two thirds of her customers are worried about their ability to cover everyday bills, reaching levels of financial stress higher than it was 18 months ago, with mortgage and rental costs top of the list of worries about stretched households.

She said customers were so heavily focused on saving money on their grocery bills that they were willing to travel between stores and around their neighbourhoods just to secure a discount on food and grocery items.

Ms Weckert, unveiling the retailer’s half-year results on Tuesday, revealed the details of the company’s latest survey of its shoppers which highlighted customer concerns over the ability to pay household bills that was at a level higher than it was 18 months ago.

“We are doing a lot of survey work, but also a lot of focus groups, and we have just completed our January cost of living survey, which we have been running on a regular basis for the last 18 months,” she told The Australian.

“We know that two thirds of customers worry about their ability to cover their household needs as we have seen costs rise and although this is higher than where we were 18 months ago, but it’s actually unchanged in terms of the levels since August 2023.

“Mortgage and rental costs are now the number one issue, although groceries obviously are still quite high on that list. And what we’re seeing is that a very high proportion of customers, almost 90 per cent of people, are making choices and changes to minimise the cost of their groceries.

“And I think that that does reflect that there’s more ability to do this in the grocery space than you can do on other bills, so you can’t really shift what your energy or your interest bill is going to the bank.”

Ms Weckert said these cost of living pressures were showing themselves in the size and composition of baskets and trolleys as her shoppers headed to the check-outs as customers either went without certain items or traded down to cheaper food and groceries.

“From a diet perspective, that’s buying less treats, buying less meat but doing a couple of meat-free days a week, but also buying less alcohol in terms of their shopping habits. We’re seeing (customers) moving into cheaper brands, cheaper cuts of meat, buying more bulk and buying more frozen.”

Ms Weckert said customers were so heavily focused on saving money on their grocery bills that they were willing to sacrifice convenience – which was traditionally a key drawcard of supermarkets – and travel between stores and around their homes to secure a discount on food and grocery items.

“If I was to reflect on all of that, we have seen for many years now that convenience of the location of the store is probably one of the key factors for customers and I think we have a growing cohort of customers now where actually value is king, and they are willing to travel between stores to find value and access the best price.”

Ms Weckert said she had recently accompanied customers on a shop, later talking with them about how and where they shop, as well as key issues around value for money and stretching that household budget further.

“And I think one of the things that was really surprising from that for me that was just a number of them were willing to hop in the car to go to places where they knew they could get good value on certain items, I do think that is becoming more prevalent.

“It just means we need to be sharper and sharper in terms of the value propositions we are providing, and that is something we are very focused on.”

To cater to this growing trend, Coles has also added tools to its mobile app, such as a search function to pin down the lowest unit price for goods and budget applications for shopping lists.