As Australians, we're creatures of habit, especially when it comes to where we buy our groceries. It turns out that many of us are sticking to the major supermarkets like Coles and Woolworths, not because of the prices, but because of our shopping habits. This loyalty is not necessarily driven by the best deals or the lowest prices, but rather by a sense of familiarity and convenience that keeps us coming back to the same place week after week.

Recent research by the think tank e61 has shed light on this phenomenon, revealing that a significant number of Aussie shoppers show a strong brand loyalty to one major grocery store over others. This preference is so strong that it's shaping the market, giving these supermarkets more power and reducing competition. The study analyzed consumer bank transactions and found that in NSW and the Australian Capital Territory, there's a high degree of 'inertia' favoring industry giants Coles and Woolworths.



Economist Matt Ellias, the author of the report, suggests that this customer behavior persists even in areas serviced by a variety of grocery stores. The lack of shopping around isn't due to a scarcity of options but rather factors like convenience, unconscious habit, and a lack of resources to help shoppers find the best deal. Coles and Woolworths also have a competitive edge by strategically locating their stores in prime areas, often within shopping centers, which offer additional amenities and convenient parking.


The research indicates that brand loyalties run deep, with 70% of customers who do their primary large shop at Woolworths likely to return a month later, and 62% still shopping there six months later. Coles sees similar loyalty, with 62% of customers returning after a month and 55% after six months. In contrast, Aldi's numbers are lower, with 48% of customers returning after a month and 37% after six months.



Interestingly, Aldi's strategy of situating stores close to the major supermarkets seems to be a tactical move, making it easier for customers to switch without much hassle. Despite this, the pull of habit keeps many shoppers loyal to their usual supermarket.

This topic of supermarket loyalty and pricing has come under scrutiny recently, with the Australian Competition & Consumer Commission (ACCC) taking legal action against Coles and Woolworths over allegations of misleading discount practices. Furthermore, a CHOICE survey found that while Aldi offered the cheapest prices for a 14-item basket of groceries, the price difference between Coles and Woolworths was minimal, and all were significantly cheaper than IGA.

The ACCC's interim report on the supermarket sector also highlighted the difficulties shoppers face in comparing prices, contributing to a loss of trust in supermarket pricing claims. These challenges are reportedly due to various pricing practices, such as frequent specials, short-term lowered prices, bulk-buy promotions, member-only prices, and bundled prices.



So, what does this mean for you, our savvy seniors? It's a reminder to consider whether your shopping habits are serving you well. Are you visiting the same supermarket out of convenience or habit, or are you actively seeking the best deals to stretch your dollar further? It's worth taking a moment to reflect on your shopping routines and whether a change might be beneficial.


We'd love to hear from you, our Seniors Discount Club members. Are you loyal to one supermarket, or do you shop around for the best prices? Have you found that your shopping habits have changed over time, or do you stick to what's familiar? Share your experiences and tips in the comments below – your insights could help fellow members make more informed choices about where they shop.