NEW HANNAFORD FORMAT REFLECTS NEW ATTITUDE

ROSEANNE HARPER

WEST FALMOUTH CROSSING, Maine -- Hannaford Bros. has introduced a new store format that emphasizes fresh foods with open-air market flair, stressing variety, quality and heightened levels of service and technology.

The 55,000-square-foot prototype is "an experiment," according to Caren Epstein, spokeswoman for the 142-unit chain, based in Scarborough, Maine.

"We're not committing ourselves to saying this is our store of the future until we gauge performance," she said, though she added customers have given the format -- featuring on-line ordering for the deli and ready-to-assist associates manning the aisles -- "rave reviews."

Leading the traffic pattern in the prototype unit is produce. Officials said fruits and vegetables were chosen after extensive consumer research found that consumers prize the produce department over others. But, in developing the space, the retailer had to incorporate other findings from the polling as well, said Epstein.

"Our research showed consumers want variety and are interested and willing to try products that are new to them as long as they can get information about them, like how they look when they're ripe, how to prepare or cook them, and in some cases, what they are and how to use them," Epstein said.

The chain responded to these findings with a produce department at this store that's 50% larger than any of its others; a new design that gives the department flagship ambiance; a product mix that hits 800 stockkeeping units and includes an uncommonly large selection of organics, exotics and ethnic products; signage designed to inform customers about the less-common items; and a service level that features two staffed demo stations, a service melon bar, and an expanded roster of associates.

Nathan Sprague, produce category manager for the chain, added that a product mix that includes the likes of yautia, islena, gobo root, lotus root, kimchee, fuzzy melon, water coconuts, and four different types of papaya, requires a commitment to customer education.

Some of the signs in the department show photos of what an item should look like at its peak of ripeness, and may even give tips on how to further ripen the product. Some tell whether the item should be peeled or whether the skin can be eaten. Preparation directions and serving suggestions are included.

A chart in the department shows a comparison of degrees of hotness in different varieties of hot peppers. An illustration of a pepper and thermometer make it a visual attention-getter. The department boasts 12 varieties of hot peppers, including fresnos, habaneras and Scotch bonnets.

"If people think jalapenos are hot, they probably haven't tried a habanera," Sprague said, explaining that habaneras top the chart and jalapenos are quite a bit lower on the heat scale.

One in-line display that features esoteric products, primarily Asian items, runs 8 linear feet. Then there's a pushcart display in the middle of the department dedicated to tropical items.

One of the more unusual products that caught customers' fancy on opening day was whole sugar cane, Sprague said.

"We do package some of it in shorter lengths, but I saw one woman with a whole 6- to 8-foot stock in her shopping cart."

While some such items are undoubtedly purchased for use in ethnic households, Sprague said he thinks a great number are bought by people just looking to add some interest to their daily menu.

Hannaford's research revealed a decided adventurous streak among consumers. They're more health-conscious and see fruit and vegetables as part of a healthy diet, but they're looking to introduce some excitement, Epstein said.

"They're willing to eat five servings a day but they don't want them it to be the same apple or tomato day after day."

Sprague theorizes that the popularity of cooking shows on television has spurred people's interest in ethnic items. Their dining experiences in restaurants, too, have introduced them to fruits and vegetables that they may not have heard of before, he said. "A lot of people are using them in recipes," he said, adding that dietary restrictions like salt intake could have helped drive a quest for new tastes, too.

"For example, for people who can't use salt, hot peppers can add some flavor."

Consumers' health-consciousness has also fueled organic sales. The mix of organic items here includes, at this point, about 65 varieties, but Sprague said he'll add more.

"A good organic supply is still hard to come by. When we're in full supply, we'll get up to about 85 items. We do well with organics, but it's a challenge. It's like setting up a mini produce department. You have to have misting for the greens and it's got to be a big enough display to give it a presence," he said.

At this store, there are 3 to 4 feet of misted organic greens and then another 24 linear feet that have been carved out for other organics. They're set at the end of the department because that positions them right around the corner from Nature's Place, the store's natural-food department.

"Even though we know we do well with organics, we were still surprised at how well some of those products sold here on opening day. We were sold out of organic bananas before the end of the afternoon, and it seemed like we were stocking organic carrots constantly."

The manned demo stations drew attentive crowds, and sold product, too. At one of the stations, customers were offered tastes of marinated, grilled portabella mushrooms, and they responded positively.

"We sold 35 cases of portabellas that day. We had an endcap display of them and they just sat there until 11 o'clock when we began the demo. Then, once people began tasting them, we could hardly keep up stocking the display. Thirty-five cases of portabellas is a lot. Normally, even when they're on sale, selling eight to 10 cases would be good."

At the same time, Hannaford's private-label teriyaki sauce, which was used as the marinade, rode the mushrooms' coattails to new sales heights.

"We had a display of the teriyaki sauce right there by the demo station, and we sold four or five cases of it before the day was over. We kept calling the meat department to bring more over."

Such cross-merchandising is part of the chain's strategy, "but we want to plan it out and do it carefully," said Sprague. He explained that it's necessary to choose carefully what products to cross-merchandise and where to position them so they don't take away from the "abundant produce" look.

This store is not the first of Hannaford's to have an immense roster of produce items. A handful of other units stocks almost as much variety, but due to space limitations, the items can't be displayed as effectively, said Sprague. He stressed that the chain knew showcasing a huge variety here would be a winning ticket based on produce's success at other stores.

"We've been focusing on produce for the last few years and a few of our other stores have a variety that goes above 700 [SKUs]. But here we can do it justice."

One example of this justice at work is found in the pushcart display that's dedicated to tropical fruits and a whole pushcart display dedicated to tomatoes.

"That makes them more noticeable," Sprague said.

The department itself stops customers in their tracks, Epstein said. It boasts a new atrium-look that is accomplished with a network of skylights that fill the aisle with natural light. To add to the open-market feel, pushcart displays are parked in the middle of the aisle, which is extra wide. Two lifelike, artificial trees are part of the arrangement and a hammered copper waterfall fountain in the floral section even adds an outdoors sound. "This department is designed to feel like the outdoors. It has everything that you would associate with fresh produce, I think. The outdoors, the natural light, the abundance. Even the sound of water could be associated with irrigation," Sprague said.

While some supermarket chains have said the produce department helps them send the "fresh message," Hannaford officials said that wasn't the primary consideration here. Giving the department such prominence was simply driven by the fact that consumers said loud and clear, and over and over again, that produce is important to them, Epstein noted.

"[Consumers] said produce is a key factor when they consider where they're going to do their grocery shopping."

Apparently they were impressed with what they saw here because the comments from customers on opening day were 100% positive, Epstein added.

"I had several customers tell me this store reminded them of Larry's [Markets] in Seattle, and that made our people happy," she said.