Discount stores slipped 3% over the past three months on net favorability toward Price, more than other retail areas selling similar products. Still, discount stores are up the most over the past year (6%). 

It appears discount stores are investing in selection to support increasing prices. Over the past six months, net favorability toward Selection grew 3% for discount stores. It remained stable for e-commerce and superstores and grew 1% for grocery. 

Over the past three months, Purchase Intent for customers making less than $50K a year has fallen rapidly for grocery (-4%) and superstores (-2%). It fell much less (-1%) for discount stores and remained stable for e-commerce. 

E-commerce was again the most resilient among middle-income customers, while grocery was the weakest. Purchase Intent for e-commerce remained stable over the past three months but dropped 1% for discount stores and superstores. It fell 2% for grocery.

While the future growth outlook dipped for low- and middle-income discount store customers, it stayed relatively steady for high-income customers over the past three months. Purchase Intent for that income group (those making over $100K/year) fell 2% for e-commerce, grocery, and superstores. 

Out of the major U.S. discount stores, only Family Dollar grew in Purchase Intent (+1%) over the past three months, putting it above Big Lots. It slipped slightly for every other store. Family Dollar is also up (+1%) for the year, alongside parent company Dollar Tree (+2%) and Ollie’s Bargain Outlets (+2%).

Family Dollar’s Purchase Intent boost is largely driven by lower-income families. Family Dollar Purchase Intent for customers making under $50K-per-year is up 5% over the past three months, far more than any of its competitors. 

Family Dollar’s jump with lower-income customers is related to its prices. Over the past three months, net favorability toward Price sunk 2%-5% for all the major discount stores, except for Family Dollar, which rose 2%. Over the last several months, Family Dollar has focused on keeping its prices low at the expense of profits at a time when many competitors have been boosting prices to keep up with higher wholesale costs. 

Among high-income customers, however, Dollar General’s Purchase Intent among high-income customers is up the most compared to its rivals in recent months. Dollar General has been expanding its grocery items through its private label Clover Valley brand and its DG Fresh initiative, which offers fresh produce across its stores. 

Dollar General’s new products are appreciated by customers. Dollar General’s net favorability toward Selection grew significantly over the past six months (+5%), far more than any other stores except Family Dollar (+4%).