Tigard, Ore. — As consumer loyalty shifts in favor of convenience, regardless of format, Supervalu, Minneapolis, is committed to making its stores more convenient shopping destinations, Mike Clawson, president of the Intermountain West division of Supervalu's Albertsons banner, told a conference audience here last week.
Speaking at the 13th annual Executive Forum sponsored by the Food Industry Leadership Center at Portland State University, Clawson cited studies in which 80% of consumers said they had shopped for groceries at more than five different stores in a three-month period, including Target, Costco and Home Depot, along with their local supermarket.
“So, people are changing the way they shop for food, and the idea that loyalty is shifting in favor of convenience is something Supervalu must address,” Clawson said.
It's doing that, he said, by putting a broad array of offerings in the “premium fresh and healthy” remodels of its Albertsons stores, including the addition of health clinics, DVD rentals, value-added meats, gift cards and party trays — “as many items as possible to provide a one-stop shopping trip,” he pointed out.
“Our mission is to serve customers better than anyone else,” Clawson added.
One of the ways Albertsons is trying to do that is by localizing merchandising “and empowering our people to handle whatever changes are needed in their own markets.”
With the holidays coming up, Albertsons completed a training program to make its employees “holiday helpers” by encouraging them to learn where everything in the store is located — “from phyllo dough to plum sauce,” Clawson said — “so we don't disappoint one single customer.”
Empowerment was also on the mind of Al Plamann, president and chief executive officer of Unified Grocers, Los Angeles, who spoke about it during a separate presentation at the conference.
According to Plamann, independent operators have an opportunity to gain an edge over their chain competitors as personal empowerment becomes a more significant part of how companies do business.
“Personal empowerment is one of the driving forces of change. But, at the same time the chains are going to centralized procurement, we have store managers seeing their neighborhoods change, and we believe they need to be empowered to change their formats,” Plamann said.
Empowerment at the store level will become more significant, he added, as the industry changes from a hierarchical structure to one reflecting greater volatility, uncertainty, complexity and ambiguity, “which will require vision, understanding, clarity and agility on the part of operators,” Plamann said.
“Instead of linear thinking, supermarket retailers will have to target social networks and develop initiatives that encourage healthy living for their employees,” he added.
“At the same time, retail stores will become sources of information, not just products, and we will have to help consumers by doing a better job of communication. For example, consumers could lose confidence in the food supply, and we have to be sure the products we carry are healthy, not necessarily low-cost,” Plamann said.
In another conference presentation, Kevin Davis, chairman, president and CEO of Bristol Farms, a wholly owned subsidiary of Supervalu, said industry trends are making upscale specialty stores more attractive to a growing segment of consumers.
“The increasing number of dual-income families is creating more demand for prepared foods,” he said, “while aging Baby Boomers have more disposable income. The trend toward healthier eating habits has increased demand for high-quality perishables, and consolidation of conventional supermarkets has left a void in higher-end offerings, while the growth of Wal-Mart and warehouse clubs has reduced service as more supermarkets compete on price.”
“While conventional chains must pay attention to the 80% that's looking to save money, our customers comprise the other 20%, and maybe the top half of that — people with a lot of disposable income who are looking for someplace to spend it.”
That top 20% has grown dramatically, Davis pointed out, “which is the most important defense mechanism for a company like Bristol Farms.”