Independents Designing to Succeed

JON SPRINGER

BALTIMORE — Surviving chain-store competition isn't all that difficult once you become the living embodiment of the brand.

So said Sharon McGinnis Young, one of the eponymous sisters of McGinnis Sisters Special Food Stores, in a presentation at Food Marketing Institute's Retail Store Development conference here Oct. 22. Young, who is preparing to open a third location for the 62-year-old, Pittsburgh-based business, spoke with humor and humility on the importance of independent retailers finding a niche and selling it relentlessly.

“Image is everything,” Young said. “We're finding our customers want to be us. They want to go to dinner with us. They want to live with us. And we're trying to enhance that image.”

Young and her two sisters, she explained, daughters of the company founder, are the brand for McGinnis Sisters, and have helped the chain evolve from a small grocery store reaching indiscriminately for mass-market customers to a specialty chain focused on unique offers for its best shoppers.

The sisters accomplished this by highlighting their own efforts to procure fresh foods in a series of television advertisements, in-store signage, sales circulars and other promotional items, Young explained. These efforts combined with new ideas for store design and product mix are achieving an in-store image to match the branding campaign.

Television ads — to save money, several were filmed at Young's home — illustrate the sisters' efforts to procure items from local farms or from fishermen. The ads air on local cable systems on channels like HGTV and the Food Network.

“Our pictures go onto every piece of print work we do,” Young said. “It's difficult to have your face out there all the time. I feel like America's next top model. But we're the image. We have to be out there all the time to set ourselves apart from the major chains.”

McGinnis Sisters at the same time reduced the range of its print advertisements, going from a typical newsprint flier distributed to 90,000 homes through newspapers to a one-color weekly flier distributed via email to around 8,000 customers.

“We made a conscious decision to put 80% of our attention on the 20% of the people who were our best customers,” Young said. “We stopped trying to attract bargain hunters. It was hard to walk away from the sales volume these customers brought but they were costing us more than they were worth.”

The decision has allowed McGinnis to refrain from leading with a price message to consumers, and margins, Young said, have improved considerably. “If my mother-in-law is shopping at the store, I know we're too cheap. We've got to try to be more on the high end.”

The store's advertising message includes a spirited response to price-driven competitors, such as Giant Eagle, which relies in part on a cents-off gasoline program to draw shoppers. A McGinnis Sisters print ad showing adjacent images of a gas pump and red peppers asks, “Which tastes better?”

McGinnis Sisters also changed from a scratch bakery where bakers worked overnight to using par-baked items that can be finished in front of customers during store hours. “Let all your bakers go and sell the equipment,” she recommended. “And instead hire customer-focused guys and girls who love to sell.”

Also in the presentation, Eligio “Leo” Pena, president of New York-based Compare Foods, told of how his company has made successes out of sites abandoned by other grocers by focusing on marketing to new audiences, particularly Hispanics.

Compare — the name means the same in English and Spanish — most recently entered the Carolinas taking over and converting 23 former Winn-Dixie sites. “We knew they were missing a good part of the community,” he said.

Compare generally invests $1.5 million to renovate stores, Pena said. Changes in merchandise include installing “triple deck” meat cases; enlarging produce departments by 50%; introducing large dollar aisles; and using customer-service booths and in-store kiosks to sell items and services such as calling cards, cell phones, money orders, bill paying and check cashing, Pena said.