A comparison of shoppers:

Schnucks vs. The Neighborhood Co-op

By

Rob McGee

Econ308

As a marketing major in the SIUC College of Business, I have thoroughly

studied many different aspects of the business world. I find demographics,

specifically customer and target market demographics, particularly interesting. To

be clear, “a target market represents the people most likely to buy what you sell.

These people have something in common that solidifies their desire for your

product or service. And that something distinguishes them from the market at large

(Morton).” Companies love to identify target markets because it allows them to

focus their services and develop their brand to the satisfaction of those who do

business with them most often. Thereby creating more sales.

The reason I chose to look at the demographics of Schnucks and The Neighborhood

Co-op shoppers is because both stores have reputations of higher quality and higher

prices. I want to know who is shopping at these places and is there a statistically

significant difference between them.

Therefore, my hypotheses are:

Ho: There is no statistically significant difference between Schnucks and Co-op

shoppers.

Ha: There is a statistically significant difference between Schnucks and Co-op

shoppers.

To start, I am going to cover some existing research. Then, I am going to describe my

surveys and the relevant data of those surveys for both stores. Lastly, I am going to

outline the results of statistical tests and make conclusions about my hypotheses.

Existing research

Francis Murphy, the General Manager at The Co-op, provided me with an

extensive survey called “What do you think? A customer and owner survey.” This

survey had a total of 321 respondents and 30 questions (some with multi-statement

Likert scales). While this survey is too long to explain completely, it does have some

interesting data that pertains to my research. For instance, Question 2 asks “When

you're not shopping at the Co-op, where do you shop most often?” The number one

answer, with 43%, is Schnucks. This shows that many people who shop at The Co-op

also shop at Schnucks. For gender, the survey found that about 74% were female

and 26% were male.

For frequency of visits, the survey found the following:

For age groups, the survey found:

For household arrangements, the survey found:

For education level, the survey found:

Lastly, for income level, the survey found:

Primary Research

For The Co-op survey, I was allowed access to the store to convenience sample. My

survey contained 12 questions, 10 of which were demographically related. The

other 2 questions pertained to the motivations to shop at the Co-op.

For Schnucks, I was not allowed access to the premises for sampling. In turn, I used

referral sampling, which is where I would hand out a few surveys and then ask those

respondents for potential respondent referrals. I used the same survey for Schnucks

as I did for the Co-op; however, I replaced the motivation questions to match the

reputation of Schnucks. For this research project, I will not be using data from all

the survey questions. I will be focusing on gender, age, frequency of visits,

education, and income.

Gender

For Schnucks, I had 8 males and 12 females. For the Co-op, I had 11 males and 19

females.

Age

Age is grouped into 8 categories. For The Co-op, a majority of the respondents fell in

the age group of 25 to 34, with 13/30 or roughly 43%. For Schnucks, a majority of

the respondents fell in the 20 to 24 age group, with 8/20 or 40%.

.

Frequency of Visits

I then asked about frequency of visits to the respective stores. For Schnucks, the

most answered was “Less than once a month” with 8 respondents. A tie occurred

between “Once a Month” and “4-6 Times a Month” with 4 respondents each.

For The Co-op, the most answered was “2-3 times a month” with 8 respondents and

the second highest was a tie between “4-6 times a month” and “10+ times a month,”

both with 6 respondents. The mean for Schnucks is 2.55, which is about halfway

between once a month and 2-3 times a month. The mean for The Co-op is 3.43,

which is about halfway between 2-3 times a month and 4-6 times a month.

Children in the Household

To add to the previous question, I then asked how many children lived in the home

of the respondent. 85% of Schnucks respondents indicated that they had no

children, while 10% had one child and 5% had 3 children. For The Co-op, I found

that 83% had no children, while 13% had 1 child and 3% had 2 children. The mean

for Schnucks .25; The Co-op mean was .2. Below are frequency diagrams for

Children in the Household.

Education

Next, I asked about the highest education completed by my respondents.

For Schnucks I found that most respondents had a 4-year college degree with 6 out

of 20 and a mean of 4.45, which corresponds halfway between a 2-year degree and a

4-year degree. For The Co-op I found that most respondents had a master’s degree

with 8 out of 30 and a mean of 5.06, which is right on the 4-year degree mark.

Income

For Annual Income I found that about 45% of Schnucks respondents had an income

of $24,999 or below, with a mean of 1.84 overall. For The Co-op, I found that 53%

had an income of $24,999 or below, with a mean of 1.83 overall. Both means

correspond to the $0 to 24,999 level, but are very close to the $25,000-49,999 level.

Testing Differences between Means

Age

I found a difference in Age means of .16 and calculated a t-stat of .36. The two tail t-

critical value is 2.032. Since my t-stat is less than my t-critical value I can accept the

null hypothesis of no statistically significant difference between means.

Frequency of Visits

I found a difference in Frequency of Visits means of .88 and a t-stat of 1.55. The two

tail t-critical value is 2.02. Since my t-stat is less than my t-critical value, I can accept

the null hypothesis of no statistically significant difference between means.

Children in the household

I found a difference in Children means of -.05. I used that absolute value of that

number and found a t-stat of .293. The two tail t-critical is 2.04. Since my t stat is

less that my t-critical value, I can accept the null hypothesis of no statistically

significant difference in means.

Education Levels

I found a difference in Education means of .61. The associated t-stat is 1.69 and the

t-critical value is 2.02. The t-stat is less that the t-critical value so I accept the null

hypothesis and find no statistically significant difference in means.

Income

I found a difference in means of Income of -.008. I used that absolute value of that

number and found a t-stat of .163. The t-critical value I found is 2.01. My t-stat is

less than my t-critical value, so I accept the null hypothesis and find no significant

difference in means.

Conclusion

The Null hypothesis was accepted in all variables that I presented, therefore I

cannot conclude that there is a statistically significant difference between the

shoppers of each store. Therefore, I found that the shoppers of Schnucks and The

Co-op are on average:

25 to 34 years old

Shop at the stores about 2-3 times a month

Mostly no children (around 85%)

Have either a 2 or 4 year degree

Earn less than, but close to $24,999