SN's five "leading-edge" retailers differ in size, geography and basic marketing approaches, to name only a few areas. What they have in common is their use of information technology to springboard ahead of their competition.
These retailers are tapping into Internet-based applications and taking advantage of the real-time data possible with systems integration. They are also implementing technology-based programs for self-checkout, loss-prevention and customer-specific frequent-shopper applications.
Kroger Expands Use of Stationary Self-Scanning
CINCINNATI -- A tight labor market and a desire to make express lanes consistently available are two factors behind a strong commitment to stationary self-scanning technology by Kroger Co. here.
Following the rollout of a four-unit system in its Tylersville, Ohio, store during the first quarter of 1998, Kroger announced the installation of approximately 50 additional stationary self-scanning units would begin in May.
A store operating under the City Market banner of Kroger's Hutchinson, Kan.-based Dillon Cos. division was the first store in this "wave" to receive the technology.
Kroger also announced that four self-checkout lanes would appear in its new 70,000-square-foot Golden, Colo., King Soopers store, opening in January 1999. King Soopers, Denver, is part of the Dillon Cos. division.
Currently the units, which are designated as express lanes in a majority of stores, are being used as a solution in tight labor markets.
"The self-checkout units are helping us to deal with a severe labor shortage," Paul Bernish, spokesman for Kroger, told SN earlier this year. "We would prefer to have all our express lanes open, but often we cannot do this due to a lack of associates. The self-checkout technology is one way to address this issue."
Which additional stores will get the technology will be determined based on markets, labor issues and customer volume through express checkout lanes. These undetermined variables leave the rest of the rollout schedule undetermined.
Kroger's Central KMA, Indianapolis, and Louisville, Ky., divisions are also using the stationary units in some stores. The technology is from PSC, Webster, N.Y., and Optimal Robotics, Montreal.
Save Mart to Link Operations via Client Server Suite
MODESTO, Calif. -- Recognizing the potential benefits of systems integration, Save Mart Supermarkets here is starting to link its merchandising, pricing, purchasing and distribution operations through a suite of software applications that will reside on a client-server environment and provide data in real time. Save Mart expects its open retail system to be live by April 1999.
By using the retail system, Save Mart will be able to integrate data for its business operations into one database, rather than have its retail and warehouse processes work separately.
Save Mart discovered that by operating separate systems it experienced redundancy in processing and information. By merging its purchasing, distribution, pricing and merchandising processes on a common platform, however, Save Mart will have access to company data on-line, on a real-time basis.
Save Mart is in the process of "scrubbing" data and cleaning up its existing databases to prepare for its transition from a legacy system to a client-server network.
"This project will enable us to improve our forecasting and anticipate sales, thereby reducing inventory and increasing stock turns," Kathy Mondloch, retail pricing manager for Save Mart, told SN.
The suite of applications fueling Save Mart's integrated retail system is provided by Armature, Lisle, Ill.
Felpausch Hits Shrink by Hiking Cashier Performance
HASTINGS, Mich. -- While retailers have long realized that the point of sale is a major contributor to their shrink percentages, identifying who is responsible and what they are doing is often complicated. G&R Felpausch here is combating this form of loss via a software application that analyzes cashier performance based on data compiled at the POS.
The system collects item-movement data at the POS and does a statistical analysis of the information. Among the areas that the application focuses on are excessive cash-handling errors, sliding, scanning errors, coupon misredemption and register voids.
The 18-store retailer also rolled out an additional module that tracks the activity of each store lane, with comparisons made over three-, six, nine- and 12-week periods. This module can also alert store managers to shortages and overages charged to specific associates.
When the software was installed in January, Felpausch expected the system to trigger an increase in profit, sales and productivity. This spring the retailer reportedly expanded the system to the corporate level, allowing for a comparison of cashier productivity and performance among the chain's stores.
The software is provided by Trax Software, Scottsdale, Ariz.
Schultz Sav-O Targets Offers Based on Customer Purchase Behavior
SHEBOYGAN, Wis. -- The key to running a successful frequent-shopper program is knowing your customers, learning their shopping patterns and providing promotions and incentives that they will use and consider valuable.
Recognizing these critical issues, Schultz Sav-O here is analyzing customer purchase behavior on a daily basis in order to provide targeted discounts to frequent shoppers through its Web page.
Customers who shop the retailer's 86 Piggly Wiggly stores are able to receive incentives monthly simply by accessing the retailer's Web page and entering their frequent-shopper account number. Schultz Sav-O customizes product offers based on customer purchase histories stored in its frequent-shopper database.
"Primarily, this lets us understand what our customers want and what incentives they will redeem, as opposed to just taking a mass media approach," Michael Houser, executive vice president of marketing and merchandising for the Piggly Wiggly stores, told SN.
Offers are displayed as customers log on to the Web site. Shoppers click on the offers they want and print out the page of discounts. Customers present the printed page at the checkout, where cashiers scan a bar code printed at the top of the sheet.
The bar code triggers a printer provided by Catalina Marketing, St. Petersburg, Fla., to produce a "Web Buck" certificate for the amount redeemed during the visit. This certificate can be used during the customer's next shopping trip. The program is provided by Supermarkets Online, Greenwich, Conn., a division of Catalina.
To determine the best incentives to target specific customers, Schultz Sav-O brought its database management application in-house recently to analyze customer purchase behavior on a daily basis.
By having access to this data in-house, in real time, the retailer can generate reports, customize them, "and act upon the changing needs of our shoppers in the forms of incentives and rewards," Houser told SN.
The database management software is provided by DCI Cardmarketing, Manasquan, N.J.
Wild Oats Integrates On-Line Shopping With Loyalty Program
BOULDER, Colo. -- At a time when Web pages are becoming increasingly common, Wild Oats Community Markets here is adding a bit more functionality to its site at www.wildoats.com, through the launch of on-line home shopping.
To take this service to the next level, the retailer will be integrating its frequent-shopper program with the ordering service, to allow loyal customers to take advantage of targeted promotions on-line.
The home shopping service, which was expected to go live last month, offers a full line of private-label vitamins, supplements, herbs and additional organic items like marmalades, cereals and nuts.
Wild Oats plans to motivate its frequent shoppers to use the service by sending them e-mail reminding them to check promotions and store specials on-line. Once the loyalty program is integrated, Wild Oats plans to reward cardholders for buying products on-line.
In addition, the retailer expects to offer exclusive promotions to its cardholders based on their purchase patterns. Wild Oats expects to begin integrating its cardholder database with its home-shopping service this month.