Category Archives: Supermarket competition

Best Supermarkets in 2019?

A recent article published by msn.com rated America’s “best” supermarkets.

With more than 66,000 supermarkets and other grocery stores in the U.S according to the U.S. Census, competition between chains has never been more fierce, the article said.

For the purposes of this list, supermarkets were defined as brick-and-mortar grocers, grocery stores, membership-only warehouse clubs, and nationwide department store retailers that have supermarkets within their retail locations. In addition, only those supermarkets with outposts in multiple states and more than five locations total were considered.

Judgments were made according to the following criteria:

Stock: A wide range of brands and offerings, including organic, locally sourced, artisanal, local favorites, international foods, and private label.

Services/Departments: Departments, including butcher, deli, bakery, and pharmacy.

Innovation: Delivery options, mobile apps, and staying on top of the latest trends.

Customer Service: Efficient checkout and self-checkout, easy returns/exchanges, loyalty programs, and personal touches like baggers who take groceries to the car.

Appearance and cleanliness: Brightly lit displays, tidy shelves, clutter-free aisles, and scuff-free floors.

Contribution to the community: Creating local jobs, working with local farmers and suppliers, and helping the less fortunate.

The top ten selections on msn’s list were:

  • Publix
  • Wegmans
  • Aldi
  • Likl
  • Trader Joes
  • Whole Foods
  • Harris Teeter (branch of Kroger)
  • Costco
  • Super Target
  • Kroger
  • Walmart Setting the Pace for Online Grocery?

    Our previous post indicated that Amazon was the clear leader in online grocery shopping. However, a recent SupermarketNews article said that “Walmart’s heavy investment in e-commerce is paying off, and the retail giant could top Amazon in online grocery market share by the end of this year.”

    The data was based on a Deutsche Bank Securities report, which said Walmart  had been shifting focus and growth strategies in the direction of e-commerce, and that the chain has plans to bring online grocery delivery to 100 metropolitan areas — covering 40% of U.S. households — by the end of 2018 through its own services and third-party providers.

    Read the full article…

    Forbes Was Right: 4 Ways Your Grocery Store Might Change this Year

    This past December Forbes published an article suggesting we should expect to see more changes at the grocery store this year as the industry adapts to various competitive pressures and emerging shopping habits.

    “The last year has been a trying one for supermarkets that face not only changing technology and consumer demands but heightened competition on price,” the article said.

    The article predicted four key trends for 2018, which were:

    1. More online shopping options
    2. Mobile payment acceptance
    3. Meal kits
    4. In-store drinking and dining

    At the half-way-or-so point, it seems these predictions are on track. And clearly all four predictions focus on improving processes as well as customer service and the shopping experience!

    Guess we can all stay-tuned to see if these trends continue…

     

    Customers King at Kroeger?

    A recent SupermarketNews article reported that Kroger has launched a new improvement initiative to accelerate changes in assortments and better customer service.

    While Kroeger has been in the news lately for considering the sale of its convenience stores, the new  “Restock Kroger” improvement initiative seems to be the bigger story. It will involve “an accelerated and more data-driven effort around pricing, personalized communications with customers, and a revamp of product assortments,” the article said.

    “We will change the way people eat in the U.S.,” said Rodney McMullen, chairman and CEO. “If you are eating, we want to serve you. Unless you are eating in a white tablecloth restaurant, we want to be able to provide that meal for you.”

    Read the full article… 

    “Checkout-less” Supermarkets: What’s Old is New?

    The Seattle Times recently published an interesting and entertaining  article, which referenced the announcement made late last year by Amazon.com regarding the launch of an experimental convenience store in downtown Seattle where customers could skip the checkout line.

    While the concept was presented as futuristic and technologically innovative,  a French retail chain, Monoprix, took issue with that depiction.

    As the video showcased within the article explains (in a clever and somewhat humorous way), “Monoprix’s “Livraison à domicile +,” is their 10-year-old service that also allows shoppers skip the checkout lines – via a different form of innovation.

    What’s old is new!

    A New Era in Food Retail?

    While possibly making less of a splash than the Amazon-Whole Foods deal,  Lindl US opened a new store in Virginia Beach, VA, signifying the beginning of what many have termed a new era in food retail.

    According to a SupermarketNews article, hundreds of shoppers were waiting in a line that circled the parking lot early Thursday morning waiting for Lidl US to open the doors.

    The big splash and anticipated disruption to the industry may be based on a number of factors, two of which truly stand out:

    1. Lindl US is committed to offering the lowest prices. “We will beat the best prices in the market,” Brendan Proctor, CEO says.
    2. Lindl US is basing decisions on the voice-of-the-customer. “It’s not about whether our model works in a market,” Proctor said during an interview. “It’s about what we have to do to adapt to the market.”

    As they say, time will tell…

    Different Grocers Top Different Lists!

    A recent Reuters article focused on “low cost” grocery leaders, noting that the German grocery chain Aldi Inc is trying to outdo the world’s biggest retailer (Walmart).

    Aldi currently boasts 1,600 U.S. stores, but only accounts for about 1.5 % of the U.S. market.  A company spokesperson referenced in the article says Aldi is growing at 15% per year and plans to open 400 new locations by the end of next year; he also said Aldi’s prices are 21 % lower than its lowest-priced competitors.

    Walmart, on the other hand, currently controls about 22 % of the market and its U.S. sales are estimated to grow about 2 % this year, according to analysts; and, of course, Amazon continues to grow Amazon Fresh while feverishly testing brick-and-mortar stores.

    At the same time, in a race based on customer satisfaction and shopping experience, MediaPost reported the results of a Top Grocer’s survey done by Market Force, a market research company based in Louisville, Colorado. Their customer loyalty index is based on responses from some 12,700 consumers, the article said, and the top slots were awarded to:

    1. Wegmans and Publix (tie for 1st)
    2. Trader Joe’s
    3. H.E.B.

    Ironically, Walmart came in last in the Market Force survey… which makes one realize that price does not necessarily guarantee customer loyalty.

    Amazon “Pick-up” Stores Free for Some

    According to a recent SupermarketNews article, Amazon has released information about new “click-and-collect” sites in Seattle.

    Called “AmazonFresh Pickup,” the new concept will provide a full selection of grocery and household items available for online ordering and pickup, free to its Prime members.

    The prototype sites are currently open only to Amazon employees. While Amazon did not specify any time-frames or plans, the article quoted an analyst at Wolfe Research, who said he expected Amazon will open as many as 30 such outlets this year.

    Service v Price in Supermarkets?

    Various articles and reports are consistent: supermarket shoppers want more convenience and better service!

    One SupermarketNews article reported how consumer demand for service impacted operations at Meijer and the curbside pickup option it launched in some stores in 2015. The article quotes Peter Whitsett, EVP of merchandising and marketing at Meijer, “…[data] has put a spotlight on the huge demand for convenience, and the challenge for the big retailer to wrestle it economically. As retailers we’ve done a reasonably good job of managing price for products, but what we’re learning to do is managing price for service.”

    The piece goes on to explain that Meijer assumed curbside pick-up would primarily serve for fill-in trips, but the company soon realized they “were 180 degrees wrong. Customers said ‘do all my shopping for me.’”

    Similarly, Euromonitor International, a world leader in strategic market research, published a white paper “The New Definition of Convenience in Retail,” which indicates that, “Thanks to time-pressed consumers, the need for convenience is paramount and retailers, in all channels, are deploying tactics to get consumers what they want as conveniently as possible.”

    Of course, the convenience of online shopping and grocery delivery means different things to different people. For urbanites, many of whom opt to forgo car ownership, transportation to and from the supermarket might be the key issue. Yet for others, as noted above, time might be the driving force.

    So, what does this mean for supermarkets?

    First, as noted by Meijer’s Mr. Whitsett, supermarkets will need to go beyond managing price and find ways to streamline and improve the work processes for providing added services and convenience.

    Secondly, online shopping is poised to become a bigger part of the overall grocery shopping equation going forward, and grocery providers must find ways to compete in this arena – against the likes of Amazon and Walmart, this will not be an easy task!

    As noted in an article posted on fooddive.com, “Grocery retail value should be re-framed to emphasize non-price factors such as freshness, quality, customer service and the shopping experience. 2017 could become the year when retailers stop primarily selling products and instead start selling services, solutions, and quite possibly stellar shopping experiences.”

    3 Trends Impacting Supermarkets

    In a recent article published by ECRM, a support organization that provides business solutions to retailers by integrating process, vision and technology, three key trends were identified as having a significant impact on the grocery retail field:

    “The U.S. food retailing business has never been more competitive, the article said. “A number of trends are putting pressure on food retailers of all stripes…”

    The article went on to suggest that the food retail business is evolving and “the customer is king!” Data from a study done by Packaged Facts was also shared, identifying three key trends as “shaping” the food and beverage retail market:

    • The incursion of e-commerce onto the food retailing landscape
    • The evolution and expansion of contactless payment options
    • The rise of the smaller store formats

    Read the full article…