From The Spring 2005 Issue of Natural Grocery Buyer

Through a customer’s eyes

Shopper-centric store design puts the good stuff up front

Jennifer Alsever

At one time, a grocer with a convenient location could survive. Today, the circumstances have changed and the rule of thumb no longer applies.

Customers, who can easily jump in their cars and head to the next big-box retailer, need something more to bring them back to a smaller food store. Loyalty is mostly gone and location alone generally isn’t enough.

The survivors of the big-box invasion will be those stores that become customer-centric—offering clean, inviting outlets that are easy to navigate and somehow different from the competition.

“Retailers are realizing that building a store that looks like everyone else’s isn’t good enough anymore,” says Ted Bauer, director of business development at Design Services Group, a retail design consulting firm in Eden Prairie, Minn. “They need to do something different that gets attention and makes [shopping] easier.”

Perhaps a leader in this trend of customer-centric retailing is Bloom, a chain of pilot stores introduced in 2004 by Salisbury, N.C.-based Food Lion. For two years, Food Lion executives talked with customers and held focus groups to tap into new retail trends. “One thing we heard time and again from consumers was, ‘Help us make shopping easier,’” says Food Lion spokesman Jeff Lowrance.

The result was Bloom, five stores in the Greater Charlotte, N.C., area that capitalize on the fact that most shoppers at 4 p.m. don’t know what they’ll eat for dinner. The stores, ranging in size from 32,000 square feet to 38,000 square feet, sell convenience to those customers. Although these are large stores, small-scale grocers can nevertheless learn much from their example.

The aisles are arranged in “universes,” with food and nonfood items separated. Products are stocked with the consumer in mind, not the store. For instance, Fresca is not grouped with Coca-Cola brands but instead with other ginger ale-type products. The convenience mantra repeats itself throughout the stores. The meat and vegetable departments are in close proximity to each other to create a “meal solution center,” with recipes available at kiosks.

A circular section in the front of the store, dubbed “Table Top Center,” features ideas for dinner, premade meals from Boston Market and a mini- convenience store of sorts with its own check-out lane, which allows customers to quickly pick up eggs, milk, bread, soft drinks and beer. Produce is located directly behind the Table Top Center.

The stores’ errand centers include a copier machine, an ATM, a DVD rental kiosk and a place to buy bus tickets, money orders and stamps. A packaging center sells everything a customer needs to mail a parcel.

“We’re still looking at these stores truly as laboratories,” says Lowrance. Technology is a big part of those lab experiments. Store managers use tablet PCs to collect and track inventory. Customers can use personal scanners to tally purchases while still in the aisles. Kiosks located throughout the stores give recipe and wine advice and help people find products

The result? So far, so good. “We’re hearing a lot of good comments from customers anecdotally,” Lowrance says. And sales are meeting or exceeding expectations, he says.

For small food stores, such customer-oriented tactics may seem out of reach. But store managers could make pantry staples easy to find, offer time-savers such as precut fruit and prepared meals and focus more on organics and healthier products. Retailers could educate customers about food or help them organize meals by simply mounting an LCD monitor with a mouse and a computer in certain sections of the store. Using a PowerPoint presentation, the computer could offer recipes and tips on what to do with the load of pomegranates that just came in, how to pick out the right tomato or where to find ingredients in the store for that evening’s meal.

“It would be fairly simple to do and that’s how people think: in hyperlinks,” Bauer says. A 21-inch LCD monitor might cost $700, he says.

It never hurts, either, to look at things through the eyes of a shopper. “When you go home at night and go to your car, stop and go back and pretend you’re a customer,” Bauer says. Is the store clean? Is it cluttered? Is it inviting?

Small stores can seem more spacious and welcoming by alternating shorter 54-inch shelving between higher shelves. Because customers can see over the top, the store doesn’t feel as cramped, Bauer says.

Other stores, such as Kroger, use taller 23-foot ceilings with stemmed lighting to create a more spacious feel. Skylights, waterfalls or plants can also create a lush, natural ambiance.

Nonetheless, the best design in the world won’t matter if the food quality isn’t good, says Kevin Coupe, founder of MorningNewsBeat.com, an online retail news service, and Natural Grocery Buyer columnist.

Coupe suggests small stores focus on what they do best or, at least, what they want to learn to do best, whether it’s deli, great organics, fresh produce or meal-solutions operations.

“It’s got to be specific, and you’ve got to build it into your culture,” Coupe says.

Jim Kowalski, owner of Kowalski’s Market, a 10-store chain in Minnesota, took time to assess his operation a decade ago. “We realized we can’t be profitable selling everyday groceries [in competition] with the Wal-Marts and the Targets moving into the market,” Kowalski says.

He made a conscious effort to move into the upscale market, improving the quality of the store’s perishables and meats, and downplaying everyday items. The chain made available product information geared to special diets, created a private shopper program and, in one store, put in an Aveda spa and presented cooking classes upstairs.

Kowalski spent plenty of time getting to know his customers and figuring out what they wanted.

Doing that kind of research doesn’t have to be expensive. Managers can organize focus groups of customers, offering free wine or dinner, and ask them what the store does wrong, says Coupe.

“Boots-on-the-ground retailing doesn’t have to be expensive. It’s spending time in the store rather than in the back office,” Coupe says. “It’s a lot cheaper to keep your customers than to get them to switch back to you.”

Jennifer Alsever is a business reporter in Denver.