By Joel Albrizio, President, Adlife Marketing & Communications
"Perhaps The Bigger Question Is Who Or What Will Kroger Become"
Kroger is this huge dominant big box retailer looking somewhat untouchable, right? Or...has Kroger become a retailer lost in a retail grocery world so engrossed in transition that few of us can figure out who or what Kroger might become or even evolve into.
A better question might be... what are the retail options for Kroger?
Amazon with its acquisition of Whole Foods has put the retail food industry at every level in a position of hesitation, question and concern just to name a few emotions that come to mind.
"What Is Next In A Retail Death Spiral"
While marketing funds will always be available in some format, what is the viability of slotting and marketing income going forward for the big box grocery retailer or traditional grocery wholesaler?
Like a drug to the addict the big box retailer has sold each ad space, be it digital or print, like real estate blocks to the CPG industry for as long as anyone can remember.
In the process the big box retailer gained a competitive advantage over the smaller chain retailers as well as the independent grocer.
First and foremost this was an unfair financial advantage that never should have been allowed. The CPG in its quest to satisfy the big box food retailer sold its soul for market share. The same big box food retailer that now does all that it can to replace the major CPG Brands with private label whenever and wherever possible.
While any of us in the industry knew this was wrong little could be done about it. The big three and the CPG industry as a whole has reduced its sales force and brokers. One by one the brokers and boots on the ground sales force have disappeared in efforts to be more competitive and reduce costs.
So now back to Kroger and any big box retailer competing with Amazon and so many other fragmented digital and brick and mortar offerings.. How does any retailer demand slotting when Amazon can test market an item with no slotting fees? Better yet, Amazon offers a countrywide test market where new items could show surprise retail sales in areas of the country not considered viable initially.
Will Kroger or any major retailer attract marketing dollars when the CPG wants a digital connection with the consumer? Amazon is the undisputed king of digital connectivity?
Has Kroger lost the long loyal believers in retail food stocks? Has Kroger lost its life long connection with the shopper? Wall Street seems to believe Kroger is less of a "Brand" than it once was.
"Kroger Stock Losses Are Over 40% Year To Date...Wall Street Warnings"
With year to date stock losses of over 40% even the most optimistic retail food investor must say wait a minute some thing is really wrong here. Granted we always think, well people have to eat...but how will the consumer obtain the products they will ultimately eat?
With Safeway selling retail locations and leasing them back to raise cash and Kroger in acquisition discussions to either buy or sell, we can easily see this is a grocery industry that has no idea itself which end will ultimately be up or down.
Give a customer that smaller grocery retailer or wholesaler built on service programs specializing in the value proposition designed to touch customers and we believe here you will find retail food success.
"Recognize Your Customer...Customer Service Driven Programs"
Customer service programs on all levels will now determine where the customer shops. As an industry a hot price will be a low water mark that must be reasonable. To earn retail sales the supermarket of today must learn to sell. Sustainable retail food success will be found when customers or the potential customer find a supermarket who shows the consumer the love they deserve.
The smaller grocer used to be of the mindset they must be a great alternative store. Today with Amazon lurking as the dinosaurs once did perhaps even retailers like Kroger must now take an alternative supermarket approach and get to know its customers once again.
With customer service as a centerpiece, the retail food customer must now be treated to a great customer experience. We believe this will be the end of the nameless, faceless big box mentality.
Coming Soon..."New" Bad Adz Digital...A New Name, A New Digital Direction
Many have asked why I choose to write about what I see in the supermarket industry today and my ideas. At Bad Adz, PreparedFoodPhotos.com & Adlife we believe great ideas and the resulting branding will give new life and direction to any company. So for that reason we chose to open the discussion.
Yes, I understand I probably misspelled something or butchered the English language in a few places, the goal however was to open your minds to new ideas. Many thanks to Sharon Albrizio for her help with this article.
Joel Albrizio, President of PreparedFoodPhotos.com & Bad Adz
Follow Me On Twitter @joelalbrizio or right here on LinkedIn!
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