Sometimes, people are confused when I use the term SuperTarget. This is because SuperTargets, unlike WalMart SuperCenters, are not yet commonplace across the nation. There are only a little over 200 SuperTargets across the nation. (Incidentally, one of the first ones were built right here in the little town I live in back in 1995.)

Target operates four store formats (exclude one-off urban stores). They are Targets, Target Greatlands, PFresh Stores, and SuperTargets. These are listed in order of their grocery offerings. Targets have very limited grocery offerings, and are generally the smallest in size. Greatlands have more offerings than the basic Targets. PFresh Store format is Target’s newest, currently being rolled out. These stores would focus on Target’s private label brands. SuperTargets offer Target shoppers the widest variety of grocery items. As you can see in the video above, they basically fit a grocery store inside a Target store. These stores are very large, and is the epitome of one stop shop for the savvy Target shoppers.

The threat from Target, unlike Walmart, is not generated through scale. As mentioned above, SuperTargets are not commonplace, and there is unlikely one right around the corner from your everyday grocery stores. However, Target is very good at attracting a specific segment of shoppers via their product offering. Their private label commands a following that warrants a new store format! These shoppers may not go buy meat and fresh vegetable every week. But they pick up cookies, ready-to-be-microwaved meals, etc. that are widely available at many Targets across different store formats. And they are picking up their favorite brand – Archer Farm, the private label brand available only at Target.

Continuing with my Food for Thoughts series, this is my little snippet on WalMart SuperCenter. For those of you who would never set foot inside, you may be surprised by this video. WalMart’s grocery selection is actually pleasantly presented. Pricing on their grocery items, like all other items at WalMart, is budget friendly. While this video may not persuade you to start your grocery shopping at WalMart, I think it’s apparent why WalMart SuperCenters present such a great threat to grocery stores everywhere.

This video would soon be outdated. WalMart is continuously improving their grocery efforts, for good reasons. You may not need a new shirt every week. But, for some families, they need a new gallon of milk every day!

Related Post:

• Groceries fighting back!
• Against Mass Merchants

Related articles online

• Over Half of Walmart’s Revenues Come From Groceries (shoppingblog.com)
• Kroger CEO: we offer more than Wal-Mart (seattletimes.nwsource.com)
• Wal-Mart’s Grocery Sales Expand (wsj.com)

I have written before how Kroger Marketplaces are taking on mass merchants. As more mass merchants stock groceries, groceries are staring to stock mass merchant products.

Here is a video taken recently at a Kroger Marketplace. You could see that next to the milk is furniture. This store carries a wide variety of products, most are very economical. I have myself bought a few pieces of home goods from Kroger stores. My area rug costs only $20. I think in the current economy, Kroger Marketplace posts a specific threat. To furnish an entire house / apartment at one time could post a significant financial strain on a family. This is exactly where Kroger could fit in. Along with buying the necessities (e.g. milk), you could easily pick up something for your new / existing home that you’ve been wanting to pick up. Because of the price point, Kroger can actually encourage impulse purchase for home goods. It’s a very different proposition than making a specific trip to a Target.

It doesn’t appear that Kroger is eager to expand this model. It’s being very selective in where to put in a Marketplace store. I look forward to see how this story would continue to evolve.

Related Post: Groceries fighting back!

Retailers can be our biggest enemy (as it’s evident with the current environment of private labels gaining shelf space over brand names). Or, they can be our biggest friend. At the end of the day, our products get sold off their shelves. Therefore, I have always had a healthy fascination toward the retail industry.

The other day, I visited a local Dillion’s, a Kroger store brand, and was amazed at the level of localization. This particular store was not in Texas, or San Diego. It was in Kansas, but in a Latino neighborhood. I thought I stepped into Mexico in the product assortment and the way the store was merchandised. It shows how sophisticated the art of retailing has become. In fact, today’s retailers have very comprehensive and important information about our consumers at each of their stores. This is why joint business planning has increased in importance. Manufacturers have long conducted extensive consumer researches to understand the consumers. Retailers now are empowered with real time information. Together, we can bring to our consumer exactly the product they want at exactly where they’re looking for it.

I am fortunate to live in a testing ground, somewhat, for retailers. It’s a great place to be for someone who’s fascinated about the industry. Therefore, in the next few weeks, I’d like to bring to you what I see on the transformation that had been unfolding in the last few years on groceries.

Related Posts: Groceries Fighting Back

Recently, I believe I was at Macy’s. The “ThISit” store not only has different selections, different displays, different color schemes… it even plays different music.

I wonder at the end of the day what this means. I believe it’s all in the shopping experience. If my specific brands are in a specifically designated area, it makes it easier for me to find. It’s like shopping at a boutique, but knowing that I have the resources of the big store backing this boutique. It may mean easier returns. It may mean lower prices. It may mean convenience. It is really the best of the two worlds!

Now, as a brand, if you could get into these specialized stores where the retailer is trying to build a loyal following… you’re improving your relationship with the retailer as a business partner helping to grow each other’s mutual business!

Today I visited a retailer’s concept store. It’s really cool to get a sneak peak of what is may be the future.

But this really puts in focus the real trick to success…

Alignment.

Manufacturers and retailers really need to work together in order for these to work. If a manufacturer can have the latest and greatest widgets, but the retailer lacks the vision to bring that to life, all is lost. Likewise, the retailer can be on the cutting edge of a trend, but unless you have the product to support it, the trend would never amount to much in sales.

Finally, alignment with the consumers.

The consumers at the end of the day dictate all. What they want is the only thing that matters. Their vision of what they expect to find in a store is the only vision that matters.

Now, both manufacturers and retailers have insights on this. Sometimes they are the same, sometimes they differ slightly. If they are the same, perfect. If they differ, perhaps they need to consider the relationship fit. Perhaps the two are just playing to different strengths and answering to different consumer needs.

At the end of the day, they all must come together and find that golden triangle where the manufacturer wins, the retailer wins, and ultimately the consumer win.

PHOTO CREDIT: Kid In Aisle, originally uploaded by captscurvy.

Recently at work, the question of what exactly is a “loyalty card” came up. Because in truth, loyalty cards are really just discount cards. I for example, have one from multiple grocery stores, multiple book stores, etc. Having a loyalty card from retailer A doesn’t mean I’ll be loyal to retailer A, because I probably have one from the competing retailer B as well.

People use the loyalty cards for the instant discounts. And every time you check out, the cashier ask “if you’d like to sign up, it’s super easy.” There is no investment, financially or mentally, into this loyalty program. So, in return, there is no loyalty.

But a recent conversation with a friend reminded that there are loyalty programs that work. Airlines.

What’s the difference? Well, an airline loyalty program is everything a retail loyalty program is not.

1. Airline loyalty program is not about easy and convenient. Have you every booked a reward travel? You have to jump through hoops!
2. It’s not instant. Hoops aside, you have to save up these points! It’s not quick or easy. And once you’ve accumulated a certain number of points, you feel invested into the program. That’s why ultimately drives loyalty.

So, the moral of the story: While the payoff is important, it’s the motivation to join a loyalty program. However, like everything else, the success of a loyalty program depends on how much you actually involve the consumers in the process. Make them invest into your brand one way or another! Then, they’ll be loyal to your brand. Otherwise, it’s just another card in the wallet.

Photo credit:DSCF5589, originally uploaded by joelogon.

That’s usually easier said than done…

I had the opportunity to see a very well executed example of such this weekend – the Red Bull Air Race.

Red Bull Gives You Wings

What’s a better event to bring this to life than an air race?

However, finding the right event is only one small step toward success. The devil, as always, is in the details.

Red Bull had free sampling, of course. But true to its “cool” equity, it’s handed out by uniformed Red Bull Girls. In it’s free sample tent introducing it’s new product, it was set up as a cool lounge with DJ to complete.

Branding and promotion carried onto merchandising at the event’s gift shop.

Of course, at the end of the day, Red Bull is as much a daytime drink as it is a nighttime drink. Therefore, to round out the event, it sponsored an after-party at the nightclub in town.

But, in this day and age, these were not enough. Red Bull also had an iPhone app to make sure it continuously engage its core demographics.

So, what have you done lately to bring your slogan to life?

As far as products go, wine is the king of the origin story. Every wine has an origin, and that origin means something. That origin is supposed to affect the product in a tangible way.

Then, I remember chocolate making this play. Vosges Haut-Chocolate was a brand that built itself on the flavors of the world. Cocoa beans from different part of the world offers something slightly different to the chocolate world.

Today, I was shopping at Fresh & Easy Neighborhood Market (UK grocery giant Tesco’s US entry – currently a small chain in the West Coast). First of all, the store gives me a feeling of an expanded Trader Joe’s. Clean, higher-end, some focus on green / organic, and lots of private label stuffs.

Then, I spotted a product that was of particular interest to me. Fresh & Easy’s private label olive oil.

This line of olive oil, mimicking wine, also highlighted its origin story.

The whole line included products from Australia, California, Italy, Spain, Greece, and other exotic variations. Each variety has a reason for existence (at least a very good marketer created one). Each variety is unique and different and has something to offer the olive oil user.

For example, the olive oil from Greece featured the following copy on its label:
“Our full-bodied extra virgin olive oil has a slightly bitter, peppery finish. Perfect for dipping bread and for garnishing soups and sauces. Product of Greece.”

And folks, let’s face it… at the end of the day, it is only oil.

So, the question is: How would you take YOUR product to the next level?

Hmm… how would I…?

Gone in 2.3 Seconds: Capturing Shoppers with Effective In-store Triggers : A 2-page summary report on what influence brand choices in the aisle. Good stats to use to support your strategy. For your convenience, it’s shown below.

Another report worth downloading is: Are Men From Mars and Women from Aisle 3?. It’s decent report on recent shopper trends, given the economy. Nothing too surprising, but if you haven’t checked out some recent trends report, this is a good report to review. It’s 30-something pages, so just a tad long to just attach here, so your best bet is just download it.

Source: MZ Research Surveys