Albertsons CEO Isn't Panicking Yet

Amid a presentation punctuated with humor, Albertsons Cos. CEO Jim Donald outlined how the company was taking a practical approach to the digital disruption of the grocery industry, acknowledging it was a “follower” in e-commerce but that competitive incursion from virtual merchants validated its brick-and-mortar strengths and ultimately will sharpen them.

“Status quo, especially today in today’s four-walls/no-wall world, is a death sentence,” Donald said during his presentation at the ShopTalk conference in Las Vegas. “And if we’re pushed and challenged by companies like Amazon, Walmart, Kroger and by startups, it’s all good.”

Recent reports that Amazon would expand its physical grocery store presence came as a validation to Albertsons, he added, but it shouldn’t require panic. “Doesn’t that mean they see us as a competitor?” he said.

“Retailers that survive today are used to announcements and tectonic shifts like this. Believe it or not, that's what keeps retailers sharp. So when we see changes like [the latest Amazon report], what I said to my team was, ‘Now is our time to sharpen our saws on the customer experience. Now is our time to sharpen our saws with our vendor relations and community relations. ... This is life as a retailer.”

Donald also poked fun at the sense of panic that tends to accompany reports of disruption. “People ask me with all that’s going on, 'How do you sleep?' And I say, 'Like a baby: I wake up every two hours and cry.'”

Albertsons has ambitions to use digital disruption as a means to grow, Donald said. It is investing behind initiatives such as its click-and-collect offering called Drive Up & Go, contactless payment, a new partnership with location-technology company Glympse that was announced this week, robotic micro-pick centers and its Marketplace endless-aisles strategy.

“We’re not looking at moonshots. We’re not looking at trying something to be first or foremost. I don’t mind being a follower in the world of e-commerce,” he said. “But when you boil the whole e-commerce piece down and bolt it onto bricks and mortar, there are certain areas that make sense: Drive Up & Go, infinite aisles, partnering with a company like Takeoff. We’re not trying to reinvent e-commerce, we’re looking at the best practices and going from there.”