By Joel M. Albrizio, President
"A Successful Retailer Building Stockholder Confidence"
Retail success relies on giving the customer what they want and need. How much simpler could that be? Well lets look at it. Supermarket retailers and wholesalers have become accustomed to attempting to direct the customer toward the purchase that works best for them.
"Supermarkets find success when advertising what the customer is most likely to need & want, when they will need it"
There are so many great examples of this on the marketing calendar but lets focus in on one example so apparent yet overlooked by most in the retail supermarket marketing strategies, Christmas.
Christmas Eve is ten days from the date this article is to be published. Just a casual glance at the supermarket retailer landscape shows us circulars from supermarkets that have effective dates all expiring a week or more before Christmas Eve.
Most of the retailers observed are running a center of the plate protein most suitable for Christmas Eve or Christmas Day.
Wait a second, doesn't this ad expire at least seven days before Christmas?
Yes, however many supermarket retailers have decided to advertise a similar merchandising program for a two week period before the holiday even though during this 14 day period the food retailer will most likely run two different ads.
So imagine a supermarket where the center of the plate advertised items 14 days before the holiday are rib roasts, whole tenderloins, fresh hams, spiral hams, fresh and cooked shrimp, fruit baskets etc.
Is This What The Customers Meal Planning Requirements Are?
No, Actually Not Even Close.
The supermarkets best customer, the customer most likely to give us the best weekly basket size is a Mom or Dad running around with after school children activities.
This Mom or Dad is fighting for every spare minute to go Christmas shopping and if possible would like to find some time to meet friends or family for the holiday "get together" before the big day.
Which one of us will make a rib roast 10 days before Christmas while trying to get all of our shopping done?
Then think further and remember which one of us isn't spending more time at the office or store because Christmas is just two weeks away.
Will we want to freeze that beautiful rib roast, fresh turkey or ham that we will proudly serve on Christmas Eve or Christmas Day?
No, Not Even Close!
In addition, financially the supermarket customers discretionary cash is limited because of the many Christmas presents "our best customer" must purchase for their family and friends.
So now we have described the theory where we overlook the obvious, customers needs, financial abilities and desires to purchase these items. Regardless of what we know to be fact the supermarket attempts to sell the customer what they want the customer to buy.
"Now Enter Kroger".....the retailer that just makes retail food merchandising and the resulting purchases simple.
This weeks ad, ending December 15, 2015 has a few holiday oriented items on the front page but the feature is the chicken breast at $1.77 lb., paper towels, potatoes, milk, pot pies, etc.
Kroger's weekly circular ending 12/15 will entice the weekly shopper with quick easy to serve items. The weekly circular beginning 12/16 will be merchandised to entice the customer with high end specialty items for the holiday.
"Kroger's Merchandising Mentality Does Two Things"
First, Kroger builds its weekly basket size and customer count by advertising easy to imagine meal building specials two weeks before Christmas.
Second, Kroger has not sent any messages to the competition as to where they stand on price the all important holiday "Big Ticket" specials.
"Kroger Correctly Realizes Christmas & New Years Are Holidays Where Kroger Can Make Real Money"
To expand on the reality of Kroger's merchandising success lets review Kroger's stock price.
For the last five calendar years, beginning in December of 2010 through today Kroger's stock price has closed at a higher price year end than it began the year.
The stock price over the same period has gone from $10 to +-$41.
"A 400% Increase In The Market Cap Of This Incredible Retail Investment"
Compare this investment to WalMart who's stock has lost over a third of its market cap year to date.
When a retailer looks to sustained success we must first look to the customers needs. Merchandising must meet the customers needs and not the retailers hopes of driving holiday sales. Trying to hit a home run on items the customer neither wants or needs is likely to negatively impact overall sales.
While the supermarket retailer may enjoy increased overall sales during this period they will have failed to maximize the potential sales available to them.
It is important to make shopping so comfortable by advertising an easy to put together meal plan oriented for presentation in retail ads, both in print and digital.
Proper meal planed marketing removes the barrier restricting the customer from freely spending on easy to find appropriately timed retail specials.
"Put Meal Planning Merchandising In The Most Simple Terms"
Every week each one of us wants to spend money on what we want and enjoy to eat. Begin by organizing a merchandising plan that explains quickly and clearly to the customer what is on sale.
Don't try to sell a rib roast to customers looking for something quick before heading to the mall to go Christmas shopping.
Recognizing your customers daily obstacles identifies your retail organization as one that understands and serves the customers reality and ability to purchase. To be successful your company must be the one to make his or her life simpler.
"Kroger Demonstrates Merchandising Expertise Like A Science"
Kroger makes it seem simple to identify a meal planning strategy week in and week out that has merchandised its way to almost 3,000 locations.
With Over 100 BILLION In Retail Sales!
As a company 133 years old we consider this the finest example of a sustainable retail food enterprise.
Thank-you for your incredible ideas and support.