Kroger tries out new, green supermarket
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By Janet I. Tu
GIG HARBOR, Wash. — Karen Adams, who lives in this city near Seattle, was a regular at its old QFC grocery.
But it didn’t take her long to fall in love with Kroger’s replacement for her QFC: its first test of a new grocery-store concept called Main & Vine.
“Oh. My. Gosh,” Adams said, walking among piles of produce displayed prominently in the center of the store. “I couldn’t believe all the different kinds of kale they had. … I try to buy fresh, fresh, fresh. This layout makes it easier for me. I walk in, and that’s what I see. They make it easy for us to eat healthy.”
She added: “I do hope that they keep the prices low.”
That’s just the sort of response the national supermarket giant based in Cincinnati is hoping to get from customers as it tests the store, which opened in February. It’s a concept that emphasizes fresh, organic products sold alongside conventional brand-name staples, both at affordable prices, with a dose of community spirit.
Main & Vine’s light and airy space occupies the 27,000 square feet of the former QFC, but many of the traditional grocery aisles have been knocked down.
The produce is front and center, rather than at the perimeter, and so are a large bulk-bin area and an event center where cooking demos take place. An expansive kitchen turns out dishes such as daily dumplings, focaccia pizza and tossed salads, while a grab-and-go area offers prepared food.
The test comes at a dire time for supermarkets, as their customer base has been eroded by warehouse and big-box stores, drugstores and online retailers.
Kroger, the nation’s No. 1 supermarket chain, has logged 48 consecutive quarters of sales growth, but many other supermarket operators have gone bankrupt or closed stores.
“The modern supermarket is trying to defend itself on all fronts from a lot of these competitors,” said Neil Stern, retail analyst with McMillanDoolittle.
In the meantime, how people shop and what they’re shopping for are changing. Customers are increasingly looking for fresh produce, healthful foods, prepared meals and places to eat, learn or be entertained — via cooking demos, for instance — while in stores.
As their core customer base gets older, grocery stores also are looking to draw in the next generation, many of whom enjoy locally produced products such as craft beer and artisanal cheese.
With so much competition, supermarkets are looking for ways to differentiate themselves, entice customers and create loyalty.
Although Kroger has been successful with its conventional stores, they tend not to be places that generate strong emotional connections with customers, Stern said.
“They’re very functional, they’re very successful, but you don’t hear people raving about them the way people would talk about a Trader Joe’s or a Whole Foods,” Stern said.
Main & Vine is Kroger’s bid to change that, with a concept that, if successful, could expand to other cities.
It’s also a concept that tackles several of its main competitors at once.
The store capitalizes on Kroger’s centralized buying and distribution power to keep prices affordable on produce and staples. (Whole Foods, in comparison, uses a middleman to do its buying and distribution nationwide and ends up paying up to a nickel or more per dollar on its buys than Kroger does, estimates Burt Flickinger III, a retail analyst with Strategic Research Group.)
Main & Vine’s emphasis on fresh produce provides a contrast with Trader Joe’s, whose “ Achilles’ heel has always been that it’s average to below average in produce,” Flickinger said.
Three computer monitors let customers order specialty items not found in the store for delivery to their homes — a move that could forestall some customers from fleeing to online retailers.
And its showcasing of local products and support of the local community lift a page from the playbook of independent and small chain stores, such as Metropolitan Market.
Main & Vine also acts as a laboratory for Kroger, with successful experiments likely to find their way into some of its other stores across the country, including Fred Meyer, QFC, Harris Teeter and King Soopers.
Kroger spokesman Keith Dailey declined to give specifics on how the company will evaluate the store’s success, and if or when it might expand to other cities.
Kroger, which in recent years absorbed Harris Teeter Supermarkets and Roundy’s Supermarkets and is reportedly seeking to buy specialty grocer Fresh Market, has traditionally learned from stores it’s acquired and applied those lessons throughout the chain.
Kroger is pitching Main & Vine not just as a grocery store but as a community hub, where local products are prominently displayed, community involvement is highlighted and people can hang out in the store’s two-level cafe area
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