The retail landscape is more competitive than ever, and shopper loyalty continues to be elusive for many retailers. For supermarket operators to increase sales this year and beyond, they’ll need to focus on driving traffic, boosting basket size and building shopper loyalty in new ways. Following are five areas on which grocers can concentrate to up their store game:
1. ELEVATE THE CUSTOMER EXPERIENCE
“It is increasingly important for retailers to understand what is important to their core shoppers, as well as those shoppers that they are leaking to competitive outlets,” says Colin Stewart, SVP, Center of Shared Business Intelligence at Jacksonville, Fla.-based sales, marketing and services company Acosta.
Notes Thom Blischok, chairman and CEO of The Dialogic Group LLC, in Phoenix: “With 40 percent of the center store going away by 2023, retailers will have to improve the in-store experience, which will include grocerants.”
Diana Sheehan, director at Norwalk, Conn.based Kantar Retail, agrees. “The retailers that are going to be successful in driving traffic to the stores will be those that have created compelling service offers to convince shoppers to come in even when they don’t need to buy anything,” she says. “Hy-Vee has done a great job with its dietitians, their foodservice offer and now even connecting to fitness programs like Orangetheory. They are creating a destination store, not just a grocery store.”
While shoppers are laser-focused on value, Stewart notes that low price isn’t the only way to deliver value to consumers. “Shoppers often associate convenience with value, so supermarkets win when they focus on areas that provide convenience like foodservice, prepared foods and high-quality meal kits that provide shoppers with convenient solutions,” he points out.
Eric Richard, education coordinator at the Madison, Wis.-based International Dairy Deli Bakery Association, believes that consumers are looking for their retailers to be a source of information, and that supermarkets can differentiate themselves from other channels by becoming places where consumers can learn about food — or their overall health. “Providing them with information they can’t get elsewhere is becoming extremely important,” he says. “That can mean boosting prepared food departments, providing consumers with ideas for preparing meals, offering samplings or cooking classes.”
For other shoppers, value means in-store services, and health-and-wellness offerings, cooking classes, wine selection (and tastings), and nutritionists drive more trips and more time in store for shoppers.
Frictionless transactions at the front end of the store to expedite the checkout process are an important part of the overall experience and can be a deal-breaker for shoppers. Determining how technology will change the operating model in the store, from robots to cashless checkout, will figure into that strategy. According to Stewart, that includes options like self-checkout, scan and go, “or simply providing great customer service as shoppers complete their trip.”
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