Going on safari…in North America

Date : 01 June 2018

So far this year we’ve moved between the east and west coasts of North America hosting study tours for international retailers. We focused on providing inspiration for format development, tracking the latest ecommerce initiatives and showcasing new food-to-go concepts.

Discover five stores that captured the attention of our delegates, chosen by our North America program director Stewart Samuel.

1. Safeway, Mountain View, California: meal kits

Being relatively close to the retailer’s HQ, this store is often a test-bed for new concepts and programs. When we visited, Safeway had just launched its test of the Plated meal kit program. Albertsons, Safeway’s parent company, acquired Plated last year with a view to building a multichannel proposition alongside the traditional subscription-based model.

The range was prominently displayed in branded cases at the front of the store, showing the category’s importance in North America. Meal kits continue to see significant development. This has been demonstrated by Costco’s tie-up with Blue Apron, Peapod’s restaurant collaboration and Kroger’s acquisition of Home Chef. 

Source: IGD research

2. Whole Foods Market, Cupertino, California: ecommerce

This store was also the location for a test program which is being rolled out across additional cities in the US. Earlier this year Amazon launched the Prime Now delivery program within Whole Foods Market, offering members free two-hour delivery. 

This was the most significant initiative to launch at Whole Foods Market following the acquisition of the business last year. It aligned with our view of how the stores would be optimised to improved Amazon’s grocery ecommerce business.

Following a relatively modest start, the grocery ecommerce channel is developing apace in North America. This year, the push has centred on home delivery, while the focus over the last couple of years has been on store pickup. Many retailers have partnered with on-demand delivery companies like Instacart and Shipt to scale up quickly as same-day delivery has become the key battleground. 

Source: IGD research

3. Amazon Go, Seattle: innovation

Staying with Amazon, there was no doubt that a visit to Amazon Go would be a highlight of a trip to Seattle. The checkout-free store uses ceiling-mounted cameras and electronic sensors to track purchases, before charging customers via their Amazon account after they leave. It’s also worth noting that the store ranging has been well thought-out, offering a good mix of food-for-now and food-for-later. 

While these concepts are expanding apace in Asia, this remains a unique experience in North America. We don’t expect Amazon to open hundreds of these stores any time soon. But it does showcase the retailer’s technical capabilities and its drive to push what’s possible in the grocery sector.

Source: IGD research

4. Lidl, Washington DC: discount retail

A visit to Washington provided an opportunity to take a fresh look at Lidl, around nine months after its launch in the country. Having recently opened its 50th store, it is continuing to adapt its offer for the US market. The key features of the Washington store included stronger price and value communication, more added-value products, and building category authority in wine and bakery.

Lidl has identified significant potential in the US hard discount sector and has created a unique format in response. It’s also aiming to gain market share from traditional grocery retailers. The stores differ in several ways from its European model, reflecting the adaptations and influences it has taken from the US market. It’s learning from its initial roll-out and incorporating this into its future designs.

Source: IGD research

5. Organic Garage, Toronto: store design

One of the most interesting stores we visited this year is Organic Garage. It operates with the “Healthier Food for Less” strapline and aims to make organic foods affordable. The store features an urban design, using graffiti-style signage, and uses humour throughout toengage with its customers. 

The unique, bold design enables it to stand out in a market where all the major retailers are investing in fresh, natural and organic foods. Organic Garage has created an experience which makes it a fun place to visit.

Source: IGD research