Independents should target centre store, tech in 2013: NGA conference

2/19/2013

The central theme for last week’s national Grocers Association Show in Las Vegas was that supermarket retailers and manufacturers need to meet the increasingly competitive environment by taking advantage of the new consumer mindset and the latest shopper technology.

The annual four-day gathering, which was one of the largest in NGA history with more than 2,700 retailers, wholesalers and industry partners in attendance, featured more than 50 educational sessions covering everything from merchandising, design and loyalty programs to healthy product offerings and capitalizing on the buying local trend.

But the primary message both in the workshops and on the expo floor was that only by using technologies like smart phone applications, deploying usage-based merchandising platforms, implementing new price/value equations, and finally raising shopper dialogues, can independent supermarket retailer differentiate their companies from the competition.

Rich Niemann, CEO and president of Niemann Foods, a chain that operates 96 supermarkets, convenience, pet and hardware stores in Illinois, Iowa and Missouri, said marketing has to start even before the shopper gets to the store.

During what Niemann called the “pre-shop” mode, shoppers are making lists that they are then sticking to and retailers have to respond with a tech-enhanced solution like a smart phone-based shopping list app.

“The shopper is moving away from what they want and toward what they need. This includes increased pre-shop activity and what we have to do is get on to the lists because they are sticking to it,” said Nieman.

“Independents have a great opportunity because there is an inversion in tech usage with the consumer and not business getting the newest applications. The independent can be agile and adjust to these new applications to better serve customers with new shopping innovations," Niemann said.

In an educational session titled, “Using the Center Store to Grow,” Kevin Weatherill, CEO of The Markets, operators of three supermarkets in northwest Washington state, said his stores are eliminating out of stocks using a training process to encourage better execution and shopper engagement at the retail level.

The retailer also deploys up to 20 displays to drive incremental sales each month targeting snacks, seasonal items and other impulse products, and uses the checkout stand to merchandise water, wine and other unplanned sales.

“We put a lot of resources and effort into slowing the customer down so we can sell to them throughout the store,” said Weatherill.

Andy Knoblauch, senior vice-president of merchandising at Coborn's, which operates 39 stores in the upper Midwest, added due to their connection with the shopper and willingness to be flexible, there are so many opportunities for the independent operator to increase basket size.

Coborn's “One more item” initiative, which seeks to use human and creative resources to get shoppers to buy extra products every time they visit the store is just one example.

One last example from the session was reported by Steve Henig, vice-president of corporate merchandising at Wakefern Food Corp., a co-op serving about 290 member stores in the Mid-Atlantic states. Wakefern is devoting significant resources to developing mobile and online offers that boost in-store shopper engagement.

"We want to get to a place where the promotion is sent and the shopper responds ‘They get me. They understand what I'm about and they're sending me product offers my family can use,' ” he said, adding that the content of the messaging has to meet the value seeking nature of today’s shopper.

Other highlights of the NGA event included the announcement of NGA's expanded technology offerings through a partnership with the Center for Advancing Retail & Technology to create the NGA Solution Center and NGA Innovation Center.

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