At the Retail Council of Canada Store 2017 conference in Toronto, retailers were treated to a round table discussion titled “Evolution of the Bricks and Mortar Experience: A Grocer’s Perspective.”
Moderated by Ted Salter, partner, advisory services at Ernst & Young, the participants included Carmen Fortino, executive vice-president and Ontario division head at Metro; Angus McOuat, vice-president, merchandising and marketing at Pusateri’s Fine Foods; and Jeff York, Co-CEO of Farm Boy. The grocers had a lively discussion about how the traditional grocery store experience is evolving. In a rapidly changing grocery sector, how do conventional grocers win over customers and grow loyalty?
Customers have changed
Today’s supermarket customer has changed. Canadian consumers are more diverse and they’re more time-starved. To add to that, there's been a major generational shift. “Millennials are changing the way people shop for food,” says Pusateri’s Angus McOuat. Customers aren’t just doing a full-basket weekend shop anymore; there’s been a migration to more frequent shopping for a variety of eating occasions. Foodie culture has also taken hold; grocery store customers want to learn more about the food they’re buying. And as consumer trends evolve (think local food, global food, authenticity and ethical sourcing), grocery stores have to evolve, too.
The in-store experience
In order to keep folks shopping the aisles, grocers are trying to better connect with customers and elevate the in-store experience. “The customer is king,” says Jeff York. Farm Boy, he adds, isn’t so much a grocery store as it is a fresh food experience. He stresses advocating for the customer’s wants and needs and offering world-class customer service. For Pusateri’s, the elevated experience has become a real differentiator. The retailer positions itself as a tastemaker, leading the customer to food that’s different, exciting and new. At Metro, the in-store experience is built from the customer out. “Metro is business for the masses, not the classes,” says Metro’s Carmen Fortino of the retailer’s inclusive approach. He thinks of every Metro location as its own local business. “It’s not just about decor or products,” he says. “You have to go beyond if you want to have loyal customers.” McOuat agrees: “There’s so much competition in grocery that the in-store experience has to be excellent. People who shop at Pusateri’s are looking for something amazing—they want Instagrammable moments.”
Research is key
“You need to know why the consumer is coming to your store,” McOuat continues. It’s necessary to watch how people navigate through the aisles, and see what occasions they’re shopping for. Grocers also pay close attention to research. Consumer data can help a retailer react and adapt to the changing consumer as well as personalize the shopping experience in order to develop store loyalty and brand trust. At Farm Boy, York says, every store is different. Tweaking store design, layouts and offerings is a constant. He’s noticed, for example, that at his stores in the Greater Toronto Area, customers want more prepared food.
Don’t forget the men
It’s also important to understand that it’s not just women doing the grocery shopping. “The male shopper is the forgotten shopper,” says York. At Farm Boy’s salad bar, there are always lots of protein options for male customers. Via its loyalty program, the store has become a healthy lunch destination: if you buy 10 salads you get the next one free. York says millennials love the salad bar because they can choose exactly what they want.
The thing with technology
Today’s world is more digital, to be sure. Fortino watches new technology all the time to see how he can save his customer time and money. Using digital tools in grocery stores, however, isn’t cheap; grocers already work on thin margins, and the tools need to be executed properly. He thinks technology shouldn't be a driver in store, but a complement to the bricks and mortar experience. For him, the most important thing is to find and hire engaged employees.