Supermarket Showdown

The Digital Imperative

It’s becoming clear that grocery shoppers want all the things they love about their local stores – convenience, selection, product expertise, and community – combined into a tidy, integrated brand experience. This is known in marketing as an “omnichannel strategy,” and put most simply, it means creating a dialog with customers on their favorite social/digital platforms, whenever and wherever they are.

Seem like an unrealistic expectation? Think again.

Consumers didn’t come up with these ideas on their own. They’re taking queues from their favorite brands, and reasonably expecting the stores they shop most often — groceries — to be equally engaged with them. The problem is, groceries are often the slowest to adopt new retail trends. And when you factor in the moving target of new and constantly changing digital options (Twitter? SMS? Websites? Apps?), it’s not surprising there’s hesitation. Managers have staffs and parking lots and millions of dollars of perishables to worry about at any given moment. How can they possibly have time to update a Facebook page?

And yet, update they must.

That’s one of the big takeaways from our latest research project, an ambitious survey of grocery shoppers in 48 U.S. states. The survey report, titled Supermarket Showdown, is now complete and available upon request. The first part of the report focuses on overall grocery customer satisfaction in five key categories: Experience, Offer, Service, Community, and Navigation. The report ranks 12 chains, in terms of both overall score and in each of the above categories. The results — and resulting analyses — are interesting, to say the least.

But even more instructive are the respondents’ answers to our follow-up questions, which make up the second half of the study. To quote the report, “Digital solutions may be the fastest path to transforming secondary customers into primary customers.”

Our intention with the study wasn’t to trash the underperformers or to heap additional praise on those at the top. Instead, we identify the surprising characteristics, qualities, and even contradictions that only come when we ask, literally, thousands of shoppers for their honest opinions.

Of course, survey results without actionable analysis only take retailers so far. So we also combined these rankings with social and behavioral trends of next-generation shoppers (the so-called “millennials”) to indicate the kinds of changes and innovations stores can (and, indeed, need to) make to differentiate themselves and gain relevance in the future. In many cases, the answer is digital.

Here’s a quick look at some of the survey’s results, along with some best digital practices, both within and outside the grocery category.

Grocery Customer Rankings

Supermarket Showdown began with a demographically and geographically balanced group of more than 3,500 consumers invited to participate in our survey. After the surveys were filtered (based on a number of factors) to ensure accuracy and objectivity, a final set of 2,002 surveys were totaled and analyzed for our report.

Overall Ratings: WD Partners Customer Preference Survey

  1. Hy-Vee
  2. Whole Foods
  3. Publix
  4. Wegmans
  5. H-E-B
  6. Meijer
  7. Stop & Shop
  8. Giant Eagle
  9. Kroger
  10. Giant
  11. Safeway
  12. Food Lion

The full report includes the Top 5 and Bottom 5 rankings in each of the five performance categories. To learn more about our methodology, read our preview in the previous issue of Wayfind. Do lowest prices translate into loyalty? Want to know the secret of Hy-Vee’s success in building connections with customers? The report dives into these topics and more.

The Digital Imperative

It’s no accident that the brands atop our overall rankings are also among those doing the most innovative marketing digitally. From robust Facebook pages to truly helpful iPhone apps, their efforts are paying off. (See “Digital Outreach,” on page 4, for specific examples.)

Aren’t convinced mobile shopping is happening while people are in your store? According to a Nielsen survey of 20,000 Americans, 66 percent of those ages 24-35 own a smartphone. More than half of all U.S. households have a least one smartphone, making it the fastest-adopted new consumer technology in history. Another firm found that twothirds of U.S. consumers with smartphones use their devices to aid shopping, and another source reports that a full 21 percent of consumers search for a coupon on their mobile device while in store. These and other insights can be found in Supermarket Showdown.

The good news? Even a seemingly small step, like providing free WiFi service in your store, can make a big difference to smartphone-equipped shoppers who want to quickly access information without burning through data minutes or suffering slow connections. And with some smart investment, brands can build from there.

Digital Outreach: Examples of Grocers in Action

Supermarket Showdown makes it clear that mobile shopping assistance and other forms of digital outreach can help elevate a grocery’s brand. Here are some overall trends we’re seeing among regional and national players.

Hy-Vee
Consistently innovative for a relatively small, regional chain.

iPhone app: Integrates shopping lists, gift card balances, social media and a handy product locator uses a map to guide shoppers to hard-to-find items.

Facebook: Hy-Vee uses the social media leader to promote recipes, celebrate store associates, and create an overall community feel around the brand.

Publix
Often on the forefront of grocery innovation the last few years.

iPhone app: Allows customers to browse by department or brand name, provides current and sale information, and more.

Facebook: Very robust presence that includes individual pages on Community Outreach, Local Savings, Clubs and Programs, and much more. Fun, informal voice gives the company personality.

Wegmans
Another of the top performers overall in our survey.

YouTube Channel: Wegmans is having success with its robust “Fresh Video” channel, where it shares seasonal cooking tutorials, nutritional information, and more

Food Lion
A chain in transition.

iPhone app: Despite its low overall satisfaction score in our study, Food Lion offers a functional and well-rated mobile app.

Website: Food Lion also manages an attractive and informative website, including a compelling Community section. All of which may suggest that, despite an enviable digital offering, brands still need to demonstrate a quality in-store experience above all else.

Omnichannel Successes Outside the Grocery Category

Some retailers are offering “hyper-relevant” incentives based on their browsing and purchasing history – the opposite of those “barely-relevant” coupons many stores push on customers. Google’s boutiques.com is using technology for the consumer’s benefit by documenting shopper preferences on products, styles, prices and more for the purpose of offering them personal recommendations.

Levi’s is a letting consumers post their personal jeans profile and share it with friends via social media network. While recipe sharing and recommendations do exist on grocery Facebook pages, it often feels as if grocers are more interested in pushing certain brands via lukewarm recipes rather than offering amazing recipes to begin with. Reebok is another brand that is taking crowdsourcing and turning it into sales; more than 2.5 million unique custom shoe designs have been created and saved on Reebok’s website, all of which may be ordered online — at a premium price.

Nordstrom and West Elm are using Pinterest.com to drive web traffic. But it isn’t just about home products — Pinterest is increasingly a source for exciting new recipes — and is fertile ground for grocers to step up and offer truly creative and inspiring recipes.

Please visit wdpartners.com/research for more information.

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