Base rate hints at the blind leading the blind

I'm no expert where politics and economics are concerned, but I do like to play devil's advocate.

Today the Bank of England published the minutes of the May meeting of its Monetary Policy Committee - you can read them here. In the section headed Money, credit demand and output, the MPC talks about the fact that shoppers have recently been making more trips to the shops, but buying less each time. This is held up as a sign that household finances are under pressure.

Now, I'm not arguing that household finances are not under pressure - of course they are, we're all feeling it. But people buying less stuff, more often doesn't seem like cast-iron proof of that. If anything, it's a bit of a leap of logic to suggest the two are directly connected.

The reason I think so is because there's been a bit of a backlash against the pile-it-high, sell-it-cheap approach of the out-of-town supermarkets over the past couple of years. People just don't want to bulk-buy low-quality food from Tesco any more (although their bacon is good value...). Couple that with the Co-operative Food campaign to encourage people to shop smaller and more frequently, and you've got non-economic factors at play.

If anything, this is a trend that's set to continue, regardless of what the economy does. The latest financial update from the Co-operative Group outlines plans to substantially increase the amount of own-brand fresh produce in its stores - from 6.5% now to 25% by the middle of the decade. With all the coverage given to fresh local produce on the TV and shoppers always looking for new ways to stay healthy, I'd say smaller shopping baskets are likely to be around for some time to come as people pick produce at its best.

What does all this have to do with online marketing? Not a lot really, I just thought it was interesting... it's a reminder that things are always more complex than they seem, though. And a bit of a lesson in analytics, too - just because your average shopping basket size has dropped, it doesn't mean you're making less money, if people are buying from you twice as often. It's about the big picture.

No comments:

Post a Comment