Published on: December 19, 2019
by Dr. Russell J. Zwanka and Dr. John L. Stanton
Content Guy's Note: My friends Dr. Russell Zwanka - currently of Siena College and soon to be at Western Michigan University - and Dr. John Stanton - of St. Joseph's University - are out with a new book … "Simple Solutions To Make Customers Feel Like Your Supermarket Is Their Supermarket." Well, I'm a sucker for a learning experience, and that title certainly reflects a lot of what we talk about here on MNB … and so I asked Russell and John to give us just a taste. Which seems like a nice way to begin to wrap up 2019 - with a focus on what needs to be done in 2020.
Enjoy. (And go buy their book … available, of course, on Amazon.)
Do you work in the supermarket industry, and want to have customers feel like your supermarket is their supermarket?
Well it's simple. Just solve their food shopping problems. And do it better than anyone else. And, while you’re at it, be open 24 hours, deliver groceries within the hour, never have anything rotten on the shelf, have everything rotated perfectly, have a floor you can eat off, carry everything but don’t have unproductive inventory, and don’t forget to smile!
We didn't say it was easy. We said it was simple. If--and this a big if--you approach it in a systematic manner. We can show you how to do this. And how you can make the task manageable.
This book contains simple solutions to make customers feel like your supermarket is their supermarket. These tactics are in different categories such as singles, families with children and elderly.
The perspective, and ostensibly the most important point of view you need: the customer is at the center of everything we do in Food Marketing. It’s not the other way around- you don’t create a format or offer and convince the customer to see you as a solution to their lives. It’s their life, you get to be a part of it if they want you to be part of it. Having said that, there is plenty you can do to ensure you have a better chance than your competition. In this chapter, we will make connections between customer evolution, trends and power, and how that is changing the game- and what you can do about it.
Reality is….you might not make it. The customer has been “Amazon’d”, they expect assortment from all over the world available at their fingertips, they’d like food delivered in an hour, and they expect full price transparency. If you cannot come to this realization, it’s time to close the book, literally and figuratively. The customer wants to know “What makes you special?” If you cannot wake up every morning and know exactly what makes you special, then you probably aren’t. It’s okay, maybe the food industry isn’t for you. It’s a cutthroat, low margin, high turn business where every penny counts.
Understanding you’re still reading, then let’s make you special. Let’s figure this customer out, and then maybe figure out how to “read the tea leaves” and stay ahead of changing trends.
You hear so much about the changing of the generations! Baby Boomers to Millennials to Centennials. The “Silent” generation…. what a terrible thing to call someone. The thing to remember about generations is, it’s just a start. You cannot “bucket” an entire generation into groups, and “market” to them. People are much too individualistic to be thrown into buckets. And, if you hear someone mention Millennials, make them stop! That cohort has grouped 15 years of people together and decided to treat them the same. Don’t do it. Avoid bucketing, but do look for patterns. Here are a few:
• The customers on the “up trend” in buying power have mostly never seen a life without the internet and a smartphone in their possession. In fact, the Centennials (Gen Z) claim over 95% smartphone ownership. It’s not “different” to them to have all this power- they’ve never not had it. Using a phone for a shopping list, using it to look up health attributes of their food, using it to find hot deals, and using it to check your price versus the rest of the world- it’s all second nature.
• Multicultural is the norm. A striking fact about the changing of the United States population: 21% of those over 75 years old are non-white. 46% of the US 18-21 years old are non-white, including 22% identifying as Hispanic. It is expected 90% of the US population growth the next five years will be coming from non-white. Look at your team. Do you reflect the future?
• Health and wellness is here to stay. It’s a great trend, and hopefully lasts indefinitely. Looking up calories and ingredients on the smartphone is here and now. Full transparency about what you are putting in your products is crucial. And, if you manufacture goods and/or are a retailer with a strong private label offering, get those bad ingredients out! Why are you waiting to get the high fructose corn syrup out of your drink? You know it’s not healthy, they know it’s not healthy, so why leave bad ingredients in until the government tells you to take it out? Come on, think customer first!
• Remove chokepoints. Goes with the last one. Checkout free is the future. It’s a freight train with no brakes. It shouldn’t have any either, the registers have always been the worst part of shopping from a customer point of view. Sorry, Polly running the register and holding conversations with each customer only made the next person in line angry. I love your conversation, but not at the expense of my time! If you are not able to offer checkout free yet, then go with self-checkout. Here’s the mindset you need: self-checkout is actually offering good customer service. It’s not a lamentable lack of personal interaction, it’s getting the customers out of the chokepoint they hate. Look at Walmart, they switched to self-checkout, including using the belts, and do you see a line at Walmart anymore?
• “Compare at” is rocking! If you shop TJ Maxx, you know “compare at”. It’s combining the customer desire to find “deals”, to find discounted treasures, and it’s giving the customer something to share with their friends. Everyone wants to say, “This is usually $28, and I stole it for $18!” Everyone. This is unabashedly how retail will work going forward- you have got to make the customer look smart to themselves and their friends. Nothing is smarter than getting a good deal. It doesn’t matter how much money you have.
• Limited Time Only is right there with “compare at”. Same type of idea, except this one adds scarcity. Now, instead of getting a discount, the customer will pay a premium just because they also want to share with their friends they got something no one else got. Scarcity works! Tell someone there is a “limit of 6”, and they’ll buy 6. LTO never fails to awaken the competitive spirit in customers.
• Store brands are cool. Studies show the majority of the population has become so brand non-loyal, they don’t care about buying brands. And, if you’re in craft beer, you know this- sometimes an established brand is a negative. Store brands are cool, they provide a value, they provide margin rates for retailers, and they encourage store loyalty. Store brands are a winner, and should be cultivated. As you will read later in this book, they can even give promotional retailers a sound base of value offerings for their customers.
• Data works. You have point of sale data, you have loyalty card data, you have tons of data. Past purchase behavior tends to predict future behavior. Overlapping purchases by similar groups tends to predict purchase behavior by other similar customers. You can be part of the solution for constant refilling (auto-replenish) of commodity items, suggestions for other purchases, making lives easier. For some reason, it seems only Amazon understands this- and Dunnhumby. Using data to predict future behavior makes analytical workers in the future highly valuable.
• Retailers with expertise sharing space is the future. Target combining with CVS was just the beginning. Kroger and Walgreens, etc. Rather than develop expertise, why not let experts offer that service for your aggregated customers? Think, if you could find a Lidl or Aldi inside a Target? Game changer, right?
Winners won’t always win and losers won’t always lose. Sears was on top of the world, until it wasn’t. A&P ruled from coast to coast, until it didn’t. TJ Maxx was a bit player, until it came into its own. Walmart was suffering until it grabbed a toehold, and is kicking butt again! Aldi was slowly expanding until Lidl came to the US. Target was cool, then wasn’t, and now is….they found their mojo again!
Winning means taking it from somebody. We apologize for the cold hard truth, but winning means someone will probably lose. The beauty of capitalism! Market share is a zero-sum game. Have the killer mentality and you’re going to be a winner!
You can buy the book here.