Tag Archives: food shopping choices

Supermarket Prediction for 2015: Fragmentation

shoppingchoiceAs year-end approaches, it is our tradition to speculate on the emerging supermarket trends.

Along similar lines, SupermarketNews recently consulted Simon Uwins, the former CMO of fresh&easy and Tesco UK, and author of Creating Loyal Brands (2014), who

The focus of Uwins’ comments is fragmentation.

“Markets are fragmenting,” he explains. “After decades of consolidating market share, major packaged grocery brands are losing share in market after market. And not to the next big brand, but rather to a plethora of small, niche brands and store brands, which better-fit consumer needs and desires.”

His article goes on to suggest that grocery is increasingly available everywhere, and at anytime: from farmers markets to supercenters, and from your finger to your door. He also referenced data presented earlier this year by The Food Marketing Institute indicating that nearly one in ten people don’t even consider themselves having a primary grocery store, which represented a threefold increase from 2013.

Given the many choices today’s food shopper has — such as on-line shopping, buying food at so many different types of stores such as pharmacy or “big box,” it can only become more difficult for traditional supermarkets to corral customers into buying in one primary location.

So, what do you think will be the winning strategy? Does the “fragmentation” prediction ring true?

Customer Loyalty… at DeMoulas or Hannaford?

It will be interesting to see if some of DeMoulas’ customers forced to shop elsewhere during the shut-down will, in fact, come back!

For example, this summer’s employee walkout at DeMoulas Super Markets resulted in around $100 million in new sales during the fiscal third quarter for rival Hannaford Bros., officials of Hannaford parent Delhaize Group said Thursday.

The extra sales were concentrated mainly in the 30 Hannaford stores located closest to Market Basket locations run by DeMoulas,

Kevin Holt, who joined Delhaize as president of its U.S. operations in July, said about the walkout, “The teams did a great job of coming in and really filling in to take care of those customers. We saw a substantial increase in transaction count during that time… we also worked very hard on trying to improve our store operation and present ourselves better as well as making some strategic price investments as well… Our intent is to hold on to all of the customers that we can.

“Market Basket did come back in the business very quickly. I think it’s a little early for us to tell right now how many customers it will actually hold on to. But we’re really focused on trying to do the best we can to hold on every customer we can and keep them with Hannaford.”

Comment…

Supermarket Shoppers Might Be More Selective Than We Think

A recent piece in New Hampshire Business Journal (February 6, 2014) referenced a study by Catalina Marketing which conducted a year-long study of the purchasing behavior of 32 million shoppers.

The study, which was published 12/6/13, is called, ‘Engaging the Selective Shopper.”  9,968 stores participated in the study and those stores averaged 35,372 UPCs.  Some of the interesting findings:

  • Over the course of a year, shoppers purchase less than 1% of the available UPC’s in the stores where they shop.  Over the course of a year, the shoppers bought an average of 260 different items
  • The BuyerGraphicsTM of each shopper are unique and shoppers across age and income are similarly selective
  • Promotions may not be as useful as retailers think or hope.  When Catalina studied one major retailer’s promotional flyer, 67% of shoppers did not buy even 1 of the 1,172 advertised items.  They then looked at the following week’s flyer (from the same retailer) and 74% of the baskets did not contain even one of the items promoted in the flyer.

Food Shopping Choice: Healthy v. Costly

All retailers would be well served by promoting an experience for customers where they feel good about more than just the taste of the food, says a recent Supermarket News article.

Using Sobey’s “Better Food” campaign as an example, author Jenna Talesca explains, “It’s not just about helping shoppers find nutritious foods, although that’s a big part of it. The campaign also aims to lead shoppers to high-quality foods, fresh foods, sustainable foods and value-added foods. There’s also an educational component to help customers put together better meals.” 

Shoppers seem to be partial to this approach, as evidenced by the surge of healthy-food retailers such as Whole Foods Market and A Market, along with healthy-choice restaurants such as the up-and-coming Chipotle and their famous “Scarecrow’s” quest for better food.

While higher-nutrition foods are not always more expensive, the question is, would you be willing to pay more for healthier choices at the supermarket that might result in “better” meals and that might bring about a “feel better” shopping experience?