Nearly half of consumers wouldn't mind if their supermarket closed

AUTHOR

Patti Zarling

PUBLISHED

June 8, 2018

Dive Brief:

• A 2018 International Loyalty Study found 12% of Americans have switched their main grocery store during the past year. It also found nearly 40% of all consumers said it would not matter to them if their main grocery store closed — they would simply shop somewhere else.
• Overall, customers seem confused by the variety of choices they have. The average American lives close to more than 10 grocery retailers, and shops at nearly half of them. Store choice, the study says, is driven by functional factors such as proximity (48%,) product range (41%,) and low prices (32%,) rather than the emotional aspects of shopping that could create a sense of loyalty between retailer and shopper. About 68% of shoppers say they simply go where they believe they can find the cheapest prices.
• Despite their popularity with retailers, loyalty cards might not be best way to encourage customers to keep coming back. The study says just 5% of customers said they would switch stores if their favored grocer ended their loyalty program. These customers want more meaningful loyalty rewards.

Dive Insight:

Making your store the go-to place for consumers is not an easy task when customers are comfortable shopping at more than one location. Grocers have a series of tools at their disposal and it seems that successful supermarket chains will need to employ a number of them, including loyalty programs, assistance in cooking and making things easier in the kitchen, and, of course, low prices. 

One of the most effective tools in keeping shoppers from leaving could be customer service. Stores who maintain a good relationship with the customer by answering questions, helping them find a product or turning a poor experience into a positive one could stand out — especially as more purchases go digital.

A recent study from KPMG found H-E-B, Publix and Wegmans stood out because of the customer service and amenities they offered.  H-E-B, for example, offers impressive and unusual displays — such as a pepper stall that organizes products from “mild and nice” to “super spicy,” and a grind-your-own nut butter station. Publix and Wegmans are known for their customer service, with the former's employees trained to greet customers as they walk in the door and carry bags to their cars after they’ve checked out.

Other grocers have tried a host of other ways to foster a closer relationship with the public. ShopRite in the Albany area of New York has a Kids Club program that gives children 12 and younger a card that they can present in the produce department to receive a free piece of fruit. In that same region, The Fresh Market, like some other grocery stores, hosts food sampling events to inspire at-home chefs and create a personal connection with customers in hopes of bringing them back.

There’s no easy way to bring customers through the door in the competitive grocery industry, but working to create an emotional connection with customers while also providing good deals may be a good place for supermarkets to start. Grocers also could boost their use of apps, smart phones and other services, such as having trained dietitians in the stores to help people find items that meet their specific needs.