LAS VEGAS — Rather than deciding between integrating or segregating natural and organic foods, Roche Bros. Supermarkets, Wellesley Hills, Mass., came up with a third alternative: positioning them at both ends of a center aisle, according to an executive with the chain.
“If you integrate a category like natural and organic, you sell more, but you don't get credit for it,” Arthur Ackles, marketing director, explained. “And if you segregate, you may miss sales, because 85% of customers may not shop that part of the store.
“So we did both, taking a center aisle and putting natural and organic selections at both ends. As a result, we're getting more credit, and sales are continuing to grow.”
Ackles spoke during a workshop on lifestyle marketing at the National Grocers Association's annual convention here.
To help keep certain customer segments aware that Roche Bros. is catering to their specific needs, Ackles said, the chain keeps ongoing lists on its website of the gluten-free and sugar-free items it offers.
Among other approaches Roche is trying to draw customers, Ackles noted the following:
Outdoor produce displays at a store on Cape Cod, “because it pulls people, including tourists, into the store.”
A “beer alley” at a store in Norton, Mass., “because we're allowed to sell alcohol at only three stores in the state, so we have it set up where a customer can walk through the alcohol section to the cashier and then exit.”
Its first in-store pharmacy at a single location, “which we expect will increase HBC sales 30% to 40%.”
In-store demos at a store in Cape Cod, “because people want to learn how to prepare their own food, and there is a local Native American chef who has his own TV show who does our demos.”
Doug Fritsch, senior vice president, retail and business development, for IGA, Chicago, talked about delivering the right format to customers, citing four examples:
Henderson's IGA in Valentine, Neb., a rural location, which revitalized its business by investing in upgrading the store to install brighter lights, wider aisles and additional checkstands, and adding sampling and cooking demonstrations.
Petrucci's IGA in Burgettstown, Pa., which partnered with McDonald's to double its size to 12,000 square feet, with a common entrance to both businesses, plus adding more upscale perishables and higher-end displays.
Kress IGA, located in downtown Seattle, “which filled a void in the downtown core as the only full-service grocer.” The owners of the store, which is located in the basement of what was once a thriving department store, invested $2 million to draw more foot traffic and installed self-service checkouts to keep customers moving.
Crossroads IGA, Bowling Green, Ky., which added a fuel station but cut back on grocery offerings to provide quick one-stop service.
In another presentation, Sharon Young, president of McGinnis Sisters, a chain of three upscale specialty stores in Pittsburgh, said that, rather than try to compete on price in stores of 10,000 to 20,000 square feet, “we compete on customer service.”
McGinnis likes to buy locally, she noted — for example, buying three hogs and chickens from one farm; blackberries from someone's backyard; or committing in advance to buy a farmer's entire crop.
“Our business is based on relationships with farmers and other suppliers, so when things get tough for us, they take care of us, and when things get tough for them, we take care of them,” Young said.
“There's too much urban sprawl, and we want to keep the family farmer going,” she explained.
The company also sends free gift cards to the top 20% of its biggest-spending customers to help drive sales, Young added. “It's our answer to coupons,” she explained.