Bolstering Neighborhood Grocery Stores with Technology and Additional Resources
In the ever-evolving world of grocery retail, smaller food retailers are finding innovative ways to compete with larger rivals by combining technology-driven strategies with traditional, non-technology approaches.
During a recent session at Progressive Grocer's GroceryTech event, industry experts emphasized the importance of this balanced approach. Scott Kaverman, senior director, strategic pricing at Schnuck Markets, highlighted the significance of a holistic pricing strategy that includes base pricing and promotional pricing to attract and retain customers.
Meanwhile, Elizabeth Abenaw, CEO of Forty Acres Market, a tech-limited grocery store, emphasized the importance of interpersonal relationships as a way to differentiate itself. Forty Acres Market, which delivers and operates pop-up stores, is about to open its first permanent physical location, and Abenaw aims to make it a "sticky" employer by offering competitive wages and creating a pathway for career growth in the grocery industry.
Schnuck Markets, on the other hand, is embracing technology to streamline its business and improve its bottom line. The grocery chain is adopting technology such as inventory management, floor-cleaning robots, smart carts, electronic shelf labels, AI-enabled salad bars, and improved personalization through its rewards app.
Key approaches for smaller food retailers include implementing personalized loyalty programs and targeted promotions using data analytics, adopting digital marketing and social media to engage customers, and creating compelling e-commerce product pages with benefit-focused descriptions, high-quality images, and videos demonstrating product use.
However, non-technology strategies are equally important. Focusing on product differentiation by offering unique or innovative items, promoting product discovery by curating a more focused selection, and investing in in-store experiences such as product demos, sampling, and innovation centers showcase niche products can help increase basket size and foster customer loyalty.
Building strong local relationships and community presence, tailoring offerings and service to local tastes and preferences, and adopting a holistic pricing strategy that balances price with value through thoughtful promotions and emphasizing quality or local sourcing are also crucial.
Elizabeth Lafontaine, director of research at Placer.ai, affirmed the importance of giving consumers a good retail experience, focusing on personal connections and relevant products and services. She emphasized that value is the most important factor consumers consider when making a retail decision, but it goes beyond just price.
Kaverman also discussed the use of technology to free up associates' time, minimize waste, and boost efficiency. The final session of Progressive Grocer's recent GroceryTech event took place June 10-12 at the Marriott Dallas Uptown.
By thoughtfully combining these technology-enabled personalization and marketing tools with curated product mixes and engaging, convenient shopping experiences, smaller food retailers can carve out distinctive positions and compete effectively against bigger rivals.
- Smaller food retailers can implement personalized loyalty programs and targeted promotions using data analytics, which helps in attracting and retaining customers.
- Schnuck Markets is utilizing technology to streamline its business, for instance, by adopting inventory management, AI-enabled salad bars, and smart carts.
- Elizabeth Abenaw, CEO of Forty Acres Market, prioritizes interpersonal relationships and plans to make her physical store a "sticky" employer by offering competitive wages and a career growth pathway in the grocery industry.
- To foster customer loyalty and increase basket size, strategies such as offering unique products, curating a focused selection, and investing in in-store experiences, including product demos and innovation centers, are critical.
