Escolar Documentos
Profissional Documentos
Cultura Documentos
January 2011
Scan this QR code with your mobile device to join our Linkedin community. Dont have a QR code reader? Download it for your iPhone or Blackberry.
Scan the QR code to join us for more up to the minute discussions on the grocery channel and other industry trends on our Watt Bullseye Linkedin page!
Although food and beverage retailing has always been somewhat immune to changes in the economy we all need to eat and drink grocery retailers today must contend both with broad economic challenges and major shifts in shopper behavior. The successful grocer must effectively incorporate the desires and needs of their shoppers into their current brand proposition using various offerings that may include discounting, new media and in-store technologies, community involvement and environmentally sustainable practices. The following report features 12 examples of leading innovation in grocery retail approaches taken by retailers as they confront emerging challenges to their respective businesses in 2011. If you want to explore this topic further, or if youre interested in finding out how Watt International can help you get more people, to buy more things, more often, please feel free to contact me. Sincerely,
quality
1
Owning health
Whole Foods Market is positioning itself as the savior of Americas health, promoting healthier prepared foods and employing a healthy eating specialist at each store. Profitability has doubled in the latest quarter to $57.5 million, and sales in 2010 grew by 12.1%, at $9 billion. The company is highly regarded by shoppers; by December 2010 it boasted 1.8 million followers on Twitter and received 428,520 likes on Facebook, making it the most popular supermarket on the social network site. www.wholefoodsmarket.com
Watts P.O.V.
Attracting new shoppers and refreshing the brand for current shoppers has become especially urgent at a time when consumers are less loyal to their main store due to economic pressures. Tags like Health Starts Here at Whole Foods Market delight the shopper by providing focus and offering lifestyle solutions, which in turn fosters shopper loyalty.
quality
2
Watts P.O.V.
Targets P-Fresh format exemplifies how grocers are quickly losing share to other channels. This is an example of intensive advertising and aggressive store re-formatting that players in the grocery channel could be leveraging.
7
Watts P.O.V.
Although retailers in this example have been acting mostly out of pragmatism rather than altruism, it pays in the long run for companies to be socially responsible. A recent study by Cone found that 65% of consumers felt companies should be ethically responsible, and that 60% of them would be more likely to buy products from companies open to shopper involvement.
8
Watts P.O.V.
Creating a strong corporate culture among employees through internal marketing programs has proven effective by retailers like Wegmans. Without the dedication of staff, the message does not get effectively communicated to the shopper. Similarly, H-E-B would not have experienced success without catering to the specific needs of its local area shoppers.
9
convenience
5
Watts P.O.V.
Grocers with a niche offering like specialty or ethnic foods, artisanal products, or entertaining retail environments can inspire shoppers to make purchasing decisions for reasons other than price.
10
convenience
6
Saving time
Stop & Shops Scan It! self checkout system allows shoppers to walk the store, paying with their Stop & Shop card as they go. Shoppers benefit from great deals, free offers, and special savings that are tailored to their shopping habits. Late last year, Apple introduced an iPhone application called AisleBuyer that allows shoppers to use their mobile phone to scan and purchase items themselves. www.stopandshop.com www.aislebuyer.com
Watts P.O.V.
In stores with a self-scanning option, a recent study found only 22.3% of shoppers actually used the self-scan lane, indicating a need for further merchandising and marketing around that option.
11
value
7
Watts P.O.V.
ALDI has perfected the respectable value offering, providing bright cheerful stores and quality value options such as the Granger brand bacon wrapped beef filet, at $1.99.
12
value
8
Watts P.O.V.
Dollar stores are a force to be reckoned with, gaining in popularity through a challenging economy, and claiming their share of the food and fresh categories. This channel reinforces the need for grocers to differentiate beyond price.
13
Watts P.O.V.
In recent years, Kroger has focused on offering a better value proposition to the customer. In addition, the use of customer analytics, the development of their private brand offering, shopper-relevant pricebased incentives and promotions, and an emphasis on service have helped Kroger to differentiate from the discounters.
14
Watts P.O.V.
A lot can be learned from TJs approach to retailing, which emphasizes fun and adventure for the shopper - an aspect of retailing that can get forgotten at some supermarkets.
15
digital communication
11
Approachable grocers
Giant Eagles website highlights personalization with lifestyle profiles, quotes and video feeds of happy Giant Eagle shoppers, like Michael: Giant Eagle customer for 18 years. The website walks shoppers through every aspect of the store, including how to sign up for eOffers that are integrated with the Giant Eagle loyalty card. Giant Eagles sales were estimated at $8 billion in 2010, with 15% of these sales coming from private brands. www.gianteagle.com
Watts P.O.V.
Giant Eagle has encapsulated its core customer and identified their needs, creating a promotional space that fully reflects and responds to them personally.
16
digital communication
12
Watts P.O.V.
Mobile couponing will continue to expand and drive growth in the grocery segment. Redemption rates for mobile coupons are 10x that of mail or newspaper distributed coupons. While user adoption has been high, shoppers have been frustrated by a lack of infrastructure at retail locations to allow them to redeem them at the register.
17
Appendix
Page 5: All stats from: FMI US Grocery Shopper Trends 2010, except for *1: Digital Coupon Use Soars in 2010, Progressive Grocer, Nov 16, 2010 Example 1: Whole Foods rolls out changes to put health at forefront of shoppers minds, By Sarah Skidmore, Canadian Business online, Jan 10, 2010; Fortune Magazines 100 Best Employers to Work for, 2010; Whole Foods Most Liked on Facebook, Supermarket News, Dec 31, 2010; Reaching Millions with Twitter: The Whole Foods Story, M. Stelzner, Social Media Examiner, Feb 9, 2010; Company annual reports Example 2: Westwood Village Target store to remodel and add P-Fresh fresh food, P. Robinson, West Seattle Herald, Jan 10, 2011; Targets Grocery Rollout Spurs Debate, J. Springer, Supermarket News, Oct 4, 2010 Example 3: Urban Grocers Proliferate, R. Steuteville, New Urban Network, Oct 1, 2009; Push for Grocery stores in poor areas, S. Sager, ABC local New York, Sep 24, 2009; Chicago food deserts: Drugstores adding fresh produce, Huffington Post, Sep 8, 2010; Just say no to food deserts, first lady tells Huckabee, FoxNews.com, Feb 21, 2010; Companies fail to engage customers on environmental and social issues, Cone/Omnicom press release, May 2010 Example 4: Fortune Magazines 100 Best Employers to Work for, 2010; H-E-B opens Mi Tienda format in Pasadena, Wegmans Organic Farm Example 5: Food retail format for the future, J. Domino, GLG News - Gerson Lehrman Group, Nov 11, 2010 Example 6: Forget check-ins, AisleBuyer is an LBS App thats all about the check-out, Mobile Marketing Watch, Aug 16, 2010; Front End Focus, Best Practices For Superior Checkout Merchandising, page 11, Dechert Hampe, FMI 2010 Example 7: Company Fact Sheet, Aldi Foods website; SNs Top 75 Retailers for 2010, Supermarket News Example 8: Ahead of the Bell: Service sector index, Jan 5, 2011, The Associated Press; Dollar General to add Colorado stores, Denver Business Journal, Jan 5, 2011; Retail ad circulars reveal top marketing trends, (ECRM Data Points), D. Orgel, Supermarket News, Jan 4 2011; SNs Top 75 Retailers for 2010, Supermarket News Example 9: Marketing with Meaning Blog, Kroger shows loyalty to customers, DHI Non-conference, B. Gilbreath, Sep 30, 2009; Private Label Magazines Top 100 Retailers and Wholesalers, Nov 2010; David Dillon Power 50 Profile Ranking:1, Supermarket News, Dec 20, 2010 Example 10: SNs Top 75 Retailers for 2010, Supermarket News; Trader Joes owner, German billionaire Albrecht dies, P. Donahue & H. Elfes, Bloomberg Business Week, Jul 28, 2010 Example 11: Private Label Magazines Top 100 Retailers and Wholesalers, Nov 2010 Example 12: Farmville cash invades supermarkets nationwide, V. Lavrusik, Mashable, Jul 21, 2010; Facebook credits making real money, Nov 15, 2010, Farmville Reviews (website); Safeways grocery chain launches mobile coupon program, G. Tsirulnik, Mobile Marketer, May 26, 2009; Mobile Marketing: Retails Next Frontier, Honeywell; Mobile coupon redemption rates to rise this year, R. Kats, Apr 21, 2010, Mobile Commerce Daily
18
we are retail.
Want to know more? contactus@wattintl.com 19
January 2011
Scan this QR code with your mobile device to join our Linkedin community. Dont have a QR code reader? Download it for your iPhone or Blackberry.
Scan the QR code to join us for more up to the minute discussions on the grocery channel and other industry trends on our Watt Bullseye Linkedin page!
Contact us at 416 364 9384 x 240 or contactus@wattintl.com to talk about how we might be able to support your business.
North America
300 Bayview Avenue Toronto, ON Canada M5A 3R7
China
24F,520 YiShan Road Shanghai 200235 P.R. China
T 021-54250172 F 021-64410492
please visit us at
20
www.wattintl.com