The final frontier… or not
It’s that time of the year again, planning for the year ahead. Work has been busy. Weekend had been busy too, with me trying to set up my new apartment and all. But, a couple weekends ago, I did manage to go and catch an amazing show – Cirque de Soleil.
Now, you can go to the Cirque without thinking about the blue ocean. No, not the ocean physically, but the business strategy. The Cirque is the quintessential example of this strategy: strip down the unnecessary (e.g. animal), amplify what works (e.g. acrobat), and add to it what the customers want (e.g. drama). If you haven’t heard about the blue ocean strategy, pick up the book by W. Chan Kim.
Before catching the show, we checked out the local food/drink district, and I came across a new advertising media. I thought this is actually quite interesting… it’s like the billboard within the bathroom stalls, this is a captive audience. But then again, there is always the clutter problem…
Groceries fighting back!
Over the July 4th weekend, I went and visited my folks. One of the first thing they asked me was what did I think of their new accessories around the house. This quickly launched a discussion about the nearby newly remodeled grocery store.
They live right behind a commercial area. They are within walking distance to a SuperTarget. Very close by are Super Wal-mart and a Kroger’s grocery store. The Kroger had a grand opening last week – for their new Marketplace.
Marketplace is a new format that Kroger has started to adopt in order to fight the retail giant – Wal-Mart. For those who are not familiar with the different retail formats, as they are not available everywhere, here is the lowdown:
• First of all, there are plain old Wal-Marts and Targets. These are general merchandise discount stores.
• Then, there are Supercenters, which have been adopted by both Wal-Mart and Target, include a full grocery store. For Wal-Mart, these are generally called Super Wal-mart or Wal-mart Supercenters. For Targets, they are branded as SuperTargets.
• Target has another store format called Target Greatland. Differ from the supercenters, which dedicate equal sized floor space to grocery (including produce, meat, deli, etc.) and general merchandise, a Target Greatland dedicate majority of the floor to general merchandise while still carrying a limited selection of grocery products.
• Finally, Wal-Mart has ventured into grocery more fully with its Neighborhood Market format. These are full grocery stores, with a limited offering of general merchandise.
So, as the discount stores enter the realm of groceries, the grocery stores are finally fighting back! Kroger began opening a new store format called Marketplace. Marketplace is still largely a grocery store. However, a significant amount of the floor space is dedicated to general merchandises, including home décor and furniture. (In fact, during my visit, I bought myself some side tables.) It appears to me that a Kroger Marketplace is the exact opposite of a Target Greatland. I would say Kroger Marketplaces are selling Target style products at Wal-Mart prices. Supposedly, this is Kroger’s attempt to fight Wal-Mart. The remodeling plan for a store generally depends on the proximity to a Wal-Mart Supercenter.
Kroger Marketplace. Photo credit: AP, Daylife.com
This was all very interesting, but it wasn’t going to change my life – until I found out that a Kroger store in my town is already being remodeled into a Marketplace! Currently, there is one Wal-Mart Supercenter in town. The Kroger closest to this Wal-Mart is the one currently being remodeled.
However, Wal-Mart is currently building a second store in my town. I am unsure of the store format for this new store. Rumors abound for a potentially new store format. This is actually possible, as my town historically has been a testing ground for new store formats. Target opened its second SuperTarget here (the same year as the first one opened). Wal-Mart built its first environmentally friendly store here. So, perhaps something new is at work. According to the official information, this store will be smaller than the existing Wal-Mart Supercenter and will carry a full line of grocery products. So, perhaps it’d be a Wal-Mart Neighborhood Market. It’s due to open spring of next year, so we’ll know soon.
Interestingly, Kroger has also announced plans to remodel the store nearest to this new Wal-Mart. The remodeling has not started yet, but the grand opening for the remodeled store is scheduled for sometime in 2009. This timeline is quite reasonable, as previous stores only took a few months to complete the remodeling.
Incidentally, my new apartment is within walking distance to this development. So, I will be able to keep an eye on what’s going on!
More from the Food For Thought series.
Happy July 4th!
Firework tent in Kansas, originally uploaded by jeannie8p.
Happy July 4th!
Recently, I moved, and it opened up a whole new world of July 4th celebration! The above picture is of a firework tent. These tents pop up all around town the week prior to Independence Day. This is the one we liked the best in town. They have really good aisle management, product management, displays, etc. It is a retail specialty of firework! We visited other tents, and their operation was less organized.
This demonstrates how important the management of any retail space is. We ignored certain price comparison and purchased all our firework here. The organization and the product assortment won us over!
I can’t wait for tonight when we shoot these into the sky! It’s going to be FUN!
Jeannie Chan is a Brand Manager for a Fortune 500 consumer goods company. She considers herself a marketer, a traveler, and a foodie. Jeannie lives in NYC. 
