retail news in context, analysis with attitude

In Minnesota, the Star Tribune reports on what it calls a “super shift” in grocery shopping habits, as the recession has compelled a sizable number of shoppers to buy at least some of their groceries from the likes of Walmart and Target as a way of saving money; they still use stores like Lunds and Byerly’s for fresh foods, but are moving away from Cub Foods for products that they think they can get cheaper at superstores and discounters.

According to the story, “SuperTarget and Wal-Mart have grabbed business nationwide over the past decade by offering one-stop shopping -- everything from pears to pants -- combined with prices that tend to be lower than those at traditional grocery stores ... Share gains by Wal-Mart and SuperTarget have come at the expense primarily of the Twin Cities' largest traditional supermarkets, Cub and Rainbow, analysts say. Still, Cub, a banner owned by Eden Prairie-based Supervalu Inc., commanded a healthy 35 percent of the market last year including franchised stores, according to IRI data.”
KC's View:
While Cub still has a strong market share, it is a little surprising to see that Target and Walmart have been able to make inroads based on the price argument. When I started out in this business (geez, I sound old), Cub was the big new thing...and everybody was predicting that its low price approach was going to put a lot of folks out of business. At least to some degree, it seems to have lost that edge...

While I’m sure the folks at Lunds and Byerly’s are not happy about losing some sales, there has to be some solace in the fact that they are selling products that cannot be replicated elsewhere. Let the big guys fight over sales of Tide and Coke and Mac & Cheese. Lunds and Byerly’s are better off in the long run selling better foods and having a vision that doesn’t cater to the lowest common denominator.