Unlike in the past, the broader assortment of products now available at discounters means that the prices for items purchased during a typical shopping trip at a discounter are easily comparable with the prices for items purchased at a traditional grocer: shoppers can literally compare apples with apples.
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They introduced value-based, private-label goods—again matching the prices at large discounters—and removed from store shelves many of their so-called price-fighter products, which shoppers regarded as low quality, replacing them with higher-quality products and brands at lower prices.
Redefine the customer value proposition. Once companies have done everything they can to trim operating costs and reduce the pricing gap, they need to determine the right value proposition to justify the remaining difference. Customers do not want the cheapest products; they want high-quality products that meet their needs, a clean store environment, helpful staff, and prices that seem to represent fair value.
However, different customers define those criteria in different ways, so grocers need to understand their target customers and how they want to shop. Those insights, in turn, have ramifications for store design, product categories, and other forms of customer engagement with the brand. For example, some grocers may target food lovers, who want the highest-quality products; a wide variety of fresh meat, produce, and seafood; and high levels of customer service.
These customers are prepared to pay a premium for the right experience. Other grocers, however, may target urban shoppers who need small stores that offer a basic assortment of products and that are within walking distance of their home or office. These shoppers make frequent, fast trips, and they will pay a reasonable price difference for convenience.
Still other grocers may target families, who tend to fill their shopping carts with enough food and nonfood items to last the week. These shoppers want low prices, regular sales and promotions, and a large store with a wide selection of products. Once a company understands its target customers, it can revise its product categories to better meet their needs. That revision, in turn, will influence the assortment of products sold, the pricing and promotion strategies, and the overall customer experience.
Private-label products are also a critical means of reshaping the customer value proposition, particularly in dry goods. Some customers will always want name brands, and grocers will always need to stock them. However, grocers can develop private-label products that are as good as branded items and offer them at prices that are competitive with those of discounters.
Doing so requires detailed customer insights and strong innovation processes, and companies that can capture this information and synthesize it in ways that lead to compelling new products can outperform established consumer packaged goods players.
For both branded and private-label products, our experience shows that revising categories to better meet customer needs can lead to a material increase in sales. Innovate to improve the customer experience. Grocers need to innovate in order to create a better experience for their customers, both in stores and online.
A retail chain in South Korea has capitalized on these trends by developing a mobile in-store navigation app that guides customers to on-sale items and sends instant coupons to their phones. Similarly, French grocer Carrefour is testing an app that guides shoppers to their preferred promotional items in stores. Along the same lines, many mainstream grocers—both national and international chains—have already made major investments in IT as part of their higher overall operating costs.
A final example is staffing levels. Despite the efforts of discount grocers to increase the sizes of their stores, traditional grocery venues are still much larger. Trying to reduce costs by eliminating some of those employees will only demoralize the remaining staff and degrade the experience that customers receive. Instead, companies should invest in training initiatives so they can offer outstanding service. Customers can shop for groceries, get a coffee at the Buzz Coffee Shop, and order a healthy snack at the organic salad bar.
The US, Sweden, and Canada are examples of such markets. Some grocery chains have already taken this path. The chain offers a narrow assortment and limited service, leading to highly competitive prices.
Accordingly, management teams will need to thoroughly consider several factors, including the following:. For example, larger stores with enhanced features require greater capital investments. The economics of store labor change as well. It takes far longer for a store associate to sort and stack fresh fruits and vegetables by hand—while minimizing losses—than to put cans on shelves.
Smart discounters get around this by developing innovative cartons and crates with attractive designs that display produce without requiring it to be stacked by hand. Similarly, offering prepared foods requires hiring employees with specialized skills. Overall, there is a risk that discounters will deviate from their successful business model—built on a small assortment of products, high volume, and lean, cost-efficient execution—and try to compete in ways that favor established grocers.
Already, a few discounters have undergone management changes due to these kinds of growing pains. To avoid this fate, discount management teams should make sure that they are maximizing their efforts in the markets where they currently operate before expanding into new ones—particularly in large countries, such as the US and Australia, which require sprawling distribution networks.
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21/04/ · How Discounters Are Remaking the Grocery Industry. A decade ago, discount grocers had a limited impact in markets. These players, which primarily offered cheaper prices for a narrower range of products, typically took 10% to 20% of market share around the edges. Today, discounters are evolving from stripped-down, no-frills stores to become. Watch Blondine Fickt Im Discounter Und Im Auto video on xHamster, the best sex tube site with tons of free German Free Im & Amateur porn movies! Best porn site discount to access interracial orgy videos. The greatest premium porn site if you're into interracial HD porn videos! You can watch only High Definition movies, more than and only high-quality photo sets, over ! This site has pornstars, black and white women that love to do hardcore sex.
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