Progressive Grocer - January 2017 by ensembleiq

Plus! Retailers weigh in for our 2017 Retail Outlook P. 53

America’s #1 Greek Yogurt*

Store of the Month

Raising The Bar

Better Food For More People

Store Director Mary Kruck and Assistant Store Director Michael Hauglie

January 2017 • Volume 96 Number 1 $10 • www.progressivegrocer.com

ChobaniÂŽ Greek Yogurt satisfies your shoppers all day long. Our authentically strained Greek Yogurt is made with only natural, non-GMO ingredients and is an excellent source of protein and good source of calcium.

For more information about Chobani, please contact us via email at Sales@Chobani.com

Plus! Retailers weigh in for our 2017 Retail Outlook P. 53

Store of the Month

Raising The Bar

Coborn’s winning brownie points with its next-generation concept store Page 42

Store Director Mary Kruck and Assistant Store Director Michael Hauglie

January 2017 • Volume 96 Number 1 $10 • www.progressivegrocer.com

Find out more at TysonVelocity.com/ChangingTheConversation

Contents

01.17

Volume 96, Issue 1

Store of the Month

Breaking New Ground Cobornâ&#x20AC;&#x2122;s launches its next-generation look with a new store north of the Twin Cities.

29 / Industry Events: 2016 Top Women in Grocery Gala Defines Perfect 10 Years! Highlights from the program presented last November in Orlando, Fla. 53 / PGâ&#x20AC;&#x2122;s Retail Outlook Challenges Temper Optimism Retailers to focus on points of differentiation in 2017. 63 / Health & Wellness Make it Better With nutrition increasingly on the minds of shoppers, grocers need to up their game. 70 / Grocery Part of the Solution Soup can be positioned as an integral component of a healthy diet.

73 / Beverages Taste Sensation Increasingly sophisticated palates are making grocers rethink the beer and wine category.

78 / Refrigerated Foods Healthy Chill Desire for fresher, better-for-you options creates opportunities in refrigerated foods.

82 / Prepared Foods Ready or Not Growth in away-from-home eating means supermarkets must continue to improve their fresh prepared food offerings. 89 / Produce Munching Mania Fruit and vegetable snacking could be the key to a healthier America.

89 January 2017 | progressivegrocer.com |

Contents

01.17

570 Lake Cook Rd, Suite 310, Deerfield, IL 60015 224 632-8200 • www.progressivegrocer.com SVP, Brand Director 201-855-7621 Associate Brand Director (AZ, CO, ID, MD, MN, MT, NM, NV, OH, TX, UT, WY)

93 / PG’s 2016 Produce

Power Session

Trading Partners Explore Opportunities, Challenges Retailer and supplier executives convene to address the hottest topics in fresh produce. 97 / Technology Is In-store Digital Ready for Prime Time? Consumer-facing tech garners mixed reviews.

105 / Equipment & Design Keeping Pace Retailers and manufacturers are both adding to their foodservice equipment lineups. 108 / Supply Chain Right on Time Retailers can increase service levels and grow sales by using workforce management technology.

8 / Editor’s Note Leading the Way 12 / PG Pulse 14 / In-store Events

Calendar

March 2017 16 / Nielsen’s Shelf

Stoppers/Spotlight

Salty Snacks/Popped Popcorn

20 / Mintel Global New Products Energy Drinks

105

22 / All’s Wellness: Best Produce for Wellness 24 / NEW Horizons Green Lights and Stop Signs 110 / What’s Next Editors’ Picks for Innovative Products 112 / The Supplier Side 114 / The Last Word Beyond the e-Commerce Echo Chamber

| Progressive Grocer | January 2017

Jeff Friedman jfriedman@ensembleiq.com Janet Blaney jblaney@ensembleiq.com

630-364-1601 EDITORIAL Editorial Director Joan Driggs 224-632-8211 jdriggs@ensembleiq.com Chief Content Editor Meg Major 724-453-3545 mmajor@ensembleiq.com Editor-in-Chief James Dudlicek 224-632-8238 jdudlicek@ensembleiq.com Managing Editor Bridget Goldschmidt 201-855-7603 bgoldschmidt@ensembleiq.com Senior Editor Randy Hofbauer 224-632-8240 rhofbauer@ensembleiq.com Senior Editor Katie Martin 224-632-8172 kmartin@ensembleiq.com Senior Editor Anna Wolfe 207-773-1154 awolfe@ensembleiq.com Technology Editor John Karolefski 440-582-1889 jkarolefski@ensembleiq.com Contributing Editors Molly Hembree, Bob Ingram, Nancy Krawczyk, Jenny McTaggart, Lynn Petrak and Jennifer Strailey ADVERTISING SALES & BUSINESS Midwest Marketing Manager John Huff 224-632-8174 jhuff@ensembleiq.com Eastern Marketing Manager Maggie Kaeppel 630-364-2150 • Mobile: 708-565-5350 mkaeppel@ensembleiq.com Western Regional Marketing Manager Rick Neigher (CA, OR, WA) rneigher@ensembleiq.com 818-597-9029 Northeast Marketing Manager Mike Shaw 201-855-7631 • Mobile: 201-281-9100 mshaw@ensembleiq.com Account Executive/ Classified Advertising Terry Kanganis 201-855-7615 • Fax: 201-855-7373 tkanganis@ensembleiq.com Classified Production Manager Mary Beth Medley 856-809-0050 marybeth@marybethmedley.com EVENTS SVP, Events & Conferences Maureen Macke 773-992-4413 mmacke@ensembleiq.com CUSTOM MEDIA VP/Custom Media Division Pierce Hollingsworth 224-632-8229 phollingsworth@ensembleiq.com General Manager, Custom Media Kathy Colwell 224-632-8244 kcolwell@ensembleiq.com MARKETING VP, Marketing & Communications Bruce Hendrickson 224-632-8214 bhendrickson@ensembleiq.com Director of Market Research Debra Chanil 201-855-7605 dchanil@ensembleiq.com AUDIENCE DEVELOPMENT Director of Audience Development Gail Reboletti greboletti@ensembleiq.com Audience Development Manager Shelly Patton 215-301-0593 spatton@ensembleiq.com List Rental The Information Refinery 800-529-9020 Brian Clotworthy Subscriber Services/Single-copy Purchases 978-671-0449 or email at EnsembleIQ@e-circ.net ART/PRODUCTION Director of Production Kathryn Homenick khomenick@ensembleiq.com Advertising/Production Manager Jackie Batson 224-632-8183 • Fax: 888-316-7987 jbatson@ensembleiq.com Art Director Bill Antkowiak bantkowiak@ensembleiq.com

CORPORATE OFFICERS Executive Chairman Alan Glass President & CEO Peter Hoyt Chief Operating Officer Richard Rivera Chief Brand Officer Jeff Greisch Chief Financial Officer Chris Stark Chief Business Development Officer & President, EnsembleIQ, Canada Korry Stagnito Chief Customer Officer/ President of Strategic Platforms Ned Bardic Chief Digital Officer Joel Hughes Chief Human Resources Officer Greg Flores

Note By Jim Dudlicek

Leading the Way Amid the expansion of e-commerce, consumers still place value in a physical store, which is a good thing for traditional grocers, who are continuing to invest in the shopper experience.

mazon’s foray into brick and mortar is either going to conquer the world or crash and burn, depending on which pundit you choose to believe. It’s gratifying to see the e-commerce titan recognize the value of physical stores in making this move in the direction of traditional retailers, who have been busy launching their own omnichannel initiatives like online ordering for home delivery or in-store pickup. In any case, it acknowledges that consumers still place value in a tangible shopping experience, and by most indications will for the foreseeable future — which is a good thing for traditional grocers, who, for the most part, are not panicking over Amazon’s latest venture while continuing to invest in the shopper experience. In fact, that’s one of the key priorities among retailers we queried for our 2017 Retail Outlook, which starts on page 52 of this issue. “While there will always be a percentage of consumers who are driven solely to make purchases by price, there will also always be consumers who choose where to purchase goods based solely on where they feel connected,” says Wayne Denningham, EVP and COO at Boise, Idaho-based Albertsons Cos., “the butcher who knows exactly how to cut and package your meat, the florist who remembers that you buy pink roses for your mother every month, the wine steward who calls you when there’s a

Jim Dudlicek

Editor-in-Chief jdudlicek@ensembleiq.com Twitter @jimdudlicek

| Progressive Grocer | Ahead of What’s Next | January 2017

great buy on a wine they think you’ll love, the checker who remembers that you’ve donated $20 to every holiday food drive and grows more appreciative year after year, or even the delivery driver who knows to put the fruit you’ve bought on the side of the kitchen where you keep your fruit bowl.” Chris Coborn, president and CEO of St. Cloud, Minn.-based Coborn’s Inc. says that providing his customers “an exceptional shopping experience” is a top priority. “In 2017, we will continue to build on our vision statement, which reads, ‘Be remarkable. Inspire happiness, healthy living and simplicity one guest at a time,’” notes Coburn (whose next-generation concept is PG’s Store of the Month in this issue, starting on page 42), adding that the company will continue to implement its new “Say Yes to the Guest Policy,” which empowers employees to ensure that shoppers’ expectations are exceeded. Meanwhile, grocers continue to seek the perfect balance between the physical and virtual shopping experiences. De Pere, Wis.-based Festival Foods is investing in its e-commerce and mobile experience, which EVP/CFO Kirk Stoa sees as both a challenge and an opportunity: “We now can deliver click-andcollect, but what’s the mix of online and in-store going to look like in the long term, and what does that do to our capital structure?” he asks. Dan Shanahan, president and COO of Wooster, Ohio-based regional grocery chain Buehler’s Fresh Foods, asserts that “the current decade is different in that it feels like there are multiple significant trends swirling about, converging and hitting tipping points.” Shanahan concludes: “Making things better for our core base while simultaneously embracing these multiple significant trends will allow us to stay relevant and lead the way.” PG

T H E

A R T

O F

M E R C H A N D I S I N G

T M

LEVERAGE KNOWLEDGE. DRIVE CONSUMPTION.

DEVELOP GROWTH.

Le ver age knowledge and cre ate ne w grow th opportunities in a changing marke t. Activate sales and growth at a retail level with evidence based data research from shopper insights. Partner with Tyson Foods and create a valuable shopping experience.

ÂŠ2016 Tyson Foods, Inc.

What’s trending on progressivegrocer.com …

The news of e-commerce behemoth Amazon.com’s entrance into brickand-mortar grocery retailing with its hybrid pilot Amazon Go format, which eliminates checkout stands and allows patrons to check in via a mobile app, grab the products they want, and walk out of the store while paying for their purchase via the app — factored as the most click-worthy story on progressivegrocer.com during the Nov.15-Dec.15 timeframe. The speculative report of Albertsons Cos. being in “advanced talks” to acquire the 130-store, Schenectady, N.Y.-based Price Chopper for about $1 billion rang in as the second most popular online story during the same period, followed next by the changing of the guard of The Kroger Co.’s chief digital officer.

Is Checkout-free a ‘Go’ for Amazon? PG Experts Weigh In bit.ly/2hGQtft

Albertsons Poised to Buy Price Chopper: Report bit.ly/2hE7GGJ

Kroger Heralds Digital Officer Succession Plan Walgreens/ Rite Aid Deal Nearing End: Reports bit.ly/2hDr0WR

bit.ly/2hsXJxD

Murray’s Cheese Reaches Milestone 350th Store bit.ly/2hE5WgA

5 Grocers Among 1st Food Waste Champs bit.ly/2hXIIkt

| Progressive Grocer | Ahead of What’s Next | January 2017

AmaZING Sweetener Sales.

The Secret to

Real ingredients – nothing artiﬁcial. Perfect sweetness. Born Sweet Zing™ Stevia Sweetener is a victory for alternative sweetener users who seek a sweetener made with only real ingredients, a perfect sweet taste and fewer calories. Stock shelves and let customers experience the taste of amaZING!

Expanding the Category

Offering Innovative Products

ASR-Group.com

Meeting Consumer Trends

March 2017 is... National Noodle Month National Nutrition Month National Peanut Month National Fresh Celery Month National Frozen Food Month

National Peanut Butter Lover’s Day. Promote outsidethe-sandwich ideas on your Pinterest page.

Email your calendar submissions to

awolfe@ensembleIQ.com

National Banana Cream Pie Day

National Cold Cuts Day

National Employee Appreciation Day. Use #Employee AppreciationDay to post on social media. National Pound Cake Day

National Cheese Doodle Day

National Oreo Day

National Cereal Day

International Women’s Day

National Frozen Food Day. Photograph your store’s most creative displays.

Daylight Saving Time begins. Time to change the clocks.

National Chicken Noodle Soup Day

It’s Girl Scouts Day. Let a local troop sell its cookies in your store.

Seafood Expo North America begins and continues through March 21.

Encourage employees to offer suggestions for Make Up Your Own Holiday Day. National Spinach Day

Pile the end caps high for National Potato Chip Day. Decorate your store for spring.

National Peanut Lovers’ Day

Natural Products Expo West, in Anaheim, Calif., opens exhibits in the Hilton and Marriott today. The convention center exhibits are open March 10-12.

National Ranch Dressing Day

National Eat Your Noodles Day

Purim begins.

National Artichoke Hearts Day

St. Patrick’s Day Not coincidentally, it’s also National Green Beer Day.

National Sloppy Joe Day. Set up cooking demos and sample this favorite.

Celebrate your customers on Everything You Do Is Right Day.

National Ravioli Day

Spanish Paella Day

National Crunchy Taco Day

It’s Something on a Stick Day. Sample appetizers, main courses and desserts — even cake pops — on sticks.

World Water Day Offer fun foods that require no preparation for International Goof Off Day.

National Lemon Chiffon Cake Day

| Progressive Grocer | Ahead of What’s Next | January 2017

National Chips and Dip Day. Make a big display of chipand-dip bowls and platters.

Whole Grain Sampling Day

National Cake Pop Day. Hold a class on making and decorating these tasty treats.

National Oysters on the Half Shell Day

International Waffle Day

at HOME

Front End

Market Intelligence By The Numbers

Shelf Stoppers

What do americans consider to be Their favorite comfort food?

Salty Snacks ToTal salTy snack sales reached $27.6 billion in The pasT year (52 weeks ending Nov. 26, 2016)

Top 5 salty snack categories $7,000,000,000 6,000,000,000 5,000,000,000 4,000,000,000 3,000,000,000

15%

2,000,000,000

choose pizza

1,000,000,000 0

poTaTo chips

52 Wks - W/e 11/26/16

52 Wks - W/e 11/28/15

TorTilla chips

52 Wks - W/e 11/29/14

meaT snacks

52 Wks - W/e 11/30/13

popcorn

52 Wks - W/e 12/01/12

cheese snacks

“While many consumers are taking steps to opt for better-for-you food choices, they still want to treat themselves. increasingly, however, they’re indulging smarter, particularly when it comes to the treats they’re consuming on a regular basis. look no further than a category like salty snacks, a $27.6 billion category that is growing by 3.2 percent in dollar sales compared with last year. however, we have seen a shift in the types of salty snacks that consumers are purchasing, as evidenced by the 15.4 percent dollar growth of popped popcorn. lately, it’s all about reaching that perfect blend of healthy indulgence.”

choose chocolate

—nielsen director of strategic insights andrew mandzy Source: nielsen

Spotlight on Popped Popcorn consumers of popped popcorn are mosT likely To purchase:

80.7% nuts

86.6% stationery and school supplies

Category nuts stationery and school supplies fresh produce cough and cold remedies

96.8%

74.9%

fresh produce

cough and cold remedies

Index 114 113 112 110

| Progressive Grocer | Ahead of What’s Next | January 2017

choose chips

choose popcorn Source: nielsen survey of 2,252 u.s. adults age 18+ surveyed online between dec. 9 and dec. 14, 2015, by The harris poll

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Step Right Up Indeed, consumers aren’t the only ones with a lot of choices with the Reis & Irvy’s Froyo Robot. Those who place Froyo Robots in their locations can buy single robots or purchase packages of four or eight machines. “This not only opens the In addition to labor savings and a clean, quick delivery of quality frozen yogurt, the Froyo Robot delivers a “food theater” experience with its interactive platforms, customer interface and process of delivery, attracting shoppers of all ages by assembling customized frozen yogurt creations in full view of the consumer and with intricate precision.

logistical support and national marketing and branding support. NEXT Steps As Generation NEXT builds the Reis & Irvy’s brand concept, it recently announced the addition of a third brand concept for 2017: 19 Degrees Premium Frozen Yogurt. “It’s a natural step in next iteration of one of America’s favorite desserts. We think it will open new doors to large retail, big box and corporate partnerships,” reports Yates. For more information on Reis & Irvy’s Froyo Robot or 19 Degrees Premium Frozen Yogurt, visit www. reisandirvys.com.

According to Yates, customers in some of the early-adopting locations have lined up just to experience the process, and people walking by the units are literally stopped in their tracks by its engaging operation. “It gives the destination or host location the ability to increase square for a captive audience and helps increase foot destination awareness and the ability for any location to increase their offerings and value to customers,” point out Yates. A Commitment to Success and Growth

About Generation NEXT Momentum continues to grow since the launch of the units last spring. As of late fall 2016, Generation NEXT has built a network of over 90 exclusive newly appointed locations across the country, a number that continues to expandmonthly. In addition, the company is implementing a national marketing and advertising campaign to support its network and bolster brand awareness and loyalty. As the Reis & Irvy’s concept expands,the team at GenerationNEXT remains dedicated to providing a model that promotes the highest level of opportunity and success for its brand ambassadors. The company offers a variety of resources, tools and standards, spanning location procurement, comprehensive training, operations and

Started in 2010 as Fresh Healthy Vending, Inc., Generation NEXT created a non-traditional approach to offering fresh healthy options within vending machines across the United States and abroad. Challenging the sugar-laden machines that blanketed the market, the new concept provided consumers choices that included natural, organic and tasty snacks such as raw granolas, mixed fruits, sports drinks, juices, protein shakes and 3,000 machines across the country. From that success, Generation NEXT Franchise Brands was founded and became recognized as an innovator and leader in the development of new franchise vending concepts, including the Reis & Irvy’s Froyo Robot.

Mintel Global New Products Database Category Insights

Sports and Energy Drinks MarkEt OvErviEw The U.S. energy drink market continued to record positive sales gains as consumers sought functional beverages that helped them perform in their busy, fast-paced lifestyles. The per capita consumption of energy drinks reached 10.3 liters in 2015. kEy iSSuES More natural and organic drinks are gaining traction as consumers search for healthier, safer products. In the 12 months to September 2016, 35 percent of the total new product launches in the sports and energy drink category carried some kind of natural claim. This is an increase of six percentage points from the previous year. Premiumization has a strong presence within the overall beverage market, and it’s starting to gain a presence in the sports and energy drink market as well. Nearly a quarter of total older Millennials (23 percent) in the United States say that they’re interested in premium energy drinks. Such innovations could create a new angle in the category to reach infrequent drinkers.

Organic certification can provide the reassuring health halo that sports and energy drinks need to appeal to health-conscious consumers. It conveys naturalness in categories associated with artificiality. Flavors that are portrayed as more sophisticated can help appeal to consumers’ interest in premium energy drinks and placement in more professional environments or drinking occasions.

| Progressive Grocer | Ahead of What’s Next | January 2017

For more information, visit www.mintel.com or call 800-932-0400.

DID YOU KNOW? Nature Made® is recommended by Pharmacists in more categories than any other vitamin and supplement brand.*

Nature Made® buyers spend significantly more each year in Pharmacy ($349) than the average VMS category buyer ($293)

Pharmavite Customer Value Proposition

VMS/Health &Wellness Affinity

Profitable Commitment Supply Shopper Innovation Volume To High Chain Engagement/ Growth Quality Excellence Activation

*Based on US News & World Report - Pharmacy Times Survey, Nature Made is the #1 Pharmacist Recommended Brand in Nine Categories - Letter Vitamins, Omega-3/ Fish Oil, Coenzyme Q10, Flaxseed Oil, Herbal Supplements, Cholesterol Management-Natural, Garlic, Diabetic Multivitamins and Mood Health Supplements † These statements have not been evaluated by the Food and Drug Administration. These products are not intended to diagnose, treat, cure or prevent any disease.

VMS/ Pharmacy Affinity

All’s By Molly Hembree

Best Produce for Wellness Help shoppers get the most from fresh fruits and veggies.

Longer Life rom apples to arugula, limes to leeks, and peaches to persimmons, the produce Shelf life could also be a factor in whether a fruit or vegetable section is loaded with varying tastes, is purchased. The Food Marketing Institute’s Food Keeper textures, colors and nutrition. tool notes that many fruits and vegetables, including melons, Many times, this is the average pineapple, cucumber, eggplant and tomatoes, are best in shopper’s first stop on their grocery trip, and it should quality and flavor if stored at room temperature and eaten convey freshness and healthfulness. Key considerations within one to three days. However, these and others, among that your shoppers have when selecting produce include them mushrooms, berries, celery and radishes, have their nutrition, shelf life and usage. shelf lives extended by up to two to four weeks As conveyed by ChooseMyPlate, a simpliwhen placed in the fridge at home. Shoppers A diet f ied version of the 2015-20 USDA Dietary may also find it helpful to know what to do with including a Guidelines for Americans, half of America’s produce that’s still safe near the end of its shelf variety of plate should be fruits and vegetables. Fresh life, such as wilted greens, overripe bananas or fruits and produce packs a punch: delivering f iber lackluster stone fruit. These items do well in soups, vegetables and essential vitamins and minerals, while baked goods or dessert creations, respectively. presents keeping saturated fat, sodium and dietary Perhaps most importantly, the best pick in strong cholesterol low. produce means a fruit or veggie that the customer support for Furthermore, some classic associations feels confident using. The average consumer may feel shoppers’ of animal-based foods, including dairy and comfortable constructing a sandwich with onion slicbest health. calcium, poultry and protein, and meat and es, throwing raspberries in oatmeal or dipping baby iron, can be challenged by the plant kingdom: carrots in dressing, but how about roasting earthy For instance, kale is a good source of calcium, Brussels sprouts, breaking open a sour pomegranate peas contain protein, and spinach proor using savory jackfruit as a meat substitute? vides iron. The rainbow of colors Retailers can build awareness of unique in produce also offers benefits fruits and vegetables through creative in the form of compounds sampling and food demcalled phytochemicals, onstrations, which can which may help preincrease the appeal of your vent cancer, control produce department and inflammation promote a bigger basket and support eye size. Keep in mind that health. meeting fruit and vegWith the cometable recommendaing of the new year, tions can be achieved many customers may in different ways. The be interested in foods Produce for Better that aid weight loss, and Health Foundation (PBH) the produce section is a terrific startencourages consumers to eat produce ing point. Most fruits and vegetables are low in all of its forms via its Fresh, Frozen, in energy density (calories) and high in nutrient density. Canned, Dried, 100% Juice: It All Matters! promotion. Many fresh fruits and vegetables act as a natural weight A diet including a variety of fruits and vegetables presmanagement tool, forcing the customer to peel, chop or ents strong support for shoppers’ best health. Whether cut the product before eating, while often the volume picking out produce based on routine, request or recipe, and moisture content of produce slow down the rate of your customers want nutritious, fresh and versatile items consumption. According to a recent position paper from to be always available in your produce department. PG the Academy of Nutrition and Dietetics, plant-based diets that emphasize fruits and vegetables — as well as Molly Hembree, RD, LD, is a registered dietitian whole grains, legumes, seeds and nuts — are associated coordinator for The Little Clinic and Kroger. with a lower body mass index (BMI).

| Progressive Grocer | Ahead of What’s Next | January 2017

Our new $50MM campaign is our biggest ever. $50MM marketing spend on a brand-new campaign 28 weeks of all-new commercials on national TV Most FSIs ever—8 beginning November 6 In-store displays, billboards, print ads, digital and PR Direct sales and merchandising support

Call your W∑nderful Sales Repr © 2016 Wonderful Pistachios & Almonds LLC. All Rights Reserved. WONDERFUL, GET CRACKIN’, the Package Design and accompanying logos are trademarks of Wonderful Pistachios & Almonds LLC or its afﬁliates. WP16210

NEW By Nancy Krawczyk

Green Lights and Stop Signs Don’t let common career barriers hold you back.

ach year, I log tens of thousands of miles to meet with women and men at every job level throughout the retail and consumer goods industry. No matter where I go, I hear this same question: “The business case for more women leaders in retail is clear, so why aren’t there more women in senior roles?” The short answer: built-in bias — in society, in our corporate cultures and in the choices women are forced to make. Women of every age, circumstance and job level experience barriers that frustrate their career goals — and dampen business results. But here’s the good news: By working together, our industry’s talent, and the companies they work for, can absolutely create workplaces that allow everyone to reach their potential. Change is happening. We see progress toward gender equality at companies like Ahold Delhaize, The Coca-Cola Co., PepsiCo Inc., Kimberly-Clark, Johnson & Johnson, Unilever, and many others. But change isn’t happening everywhere, and not nearly fast enough. NEW’s latest special report, “Green Lights and Stop Signs: The Road to Gender Parity in Retail and Consumer Goods,” written with the Center for Creative Leadership, uncovers three critical support factors that women say drive their careers forward: organizational commitment to gender diversity, developmental support through business relationships and company initiatives, and support from a professional network. The report, based on insights gathered from more than 900 NEW members, also identifies three unyielding career barriers that women say impede their careers: conflicting work/life priorities, being overlooked and undervalued, and being undermined. Here are just a few of our findings:

The two best predictors of career satisfaction, we found, are the level of an organization’s developmental support and the degree to which women experience being overlooked and underappreciated. Retail leaders must ask themselves, “What career Change is hurdles do women in our happening, organization encounter?” but not fast “Green Lights and Stop enough. Signs” doesn’t just report on the state of women at work. It lays out a blueprint for industry leaders who want to advance women and boost their business, and for women who want to blow past the stop signs that have stalled their careers. The report advises women who want to take more control of their careers to adopt these strategies:

Women perceive they must sacrifice life outside of work to hold a senior leadership position. Nearly one in 10 of the women surveyed identified competing work/ life priorities as a reason that they’ve held back from pursuing leadership positions. Women are often overlooked — not developed for leadership positions — and perceived as having less leadership potential or career commitment. A significant percentage of women say their career goals have been undermined, intentionally and unintentionally. They report their qualifications are routinely questioned. Women of color face more career barriers and experience less career support.

One strategy presented in the report is a piece of advice that I’ve given other women throughout my career: “Believe in yourself — and go for it.” For detailed action plans for women, men and industry leaders working toward gender parity, download the full “Green Lights and Stop Signs” report at newitstime.com. PG

Ask for assignments that can advance your career. Reach out to senior leaders and get their feedback. Find people who can mentor and sponsor you, and participate in formal mentoring programs offered by your company. Voluntarily participate in further education, training and career-supporting events. Read career-related books and articles, and participate in leadership webinars. NEW members can attend the NEW Leadership Academy, NEW Summit Speaker Series and NEW Small Business Leadership webinars free. Build a diverse network of influential people inside your organization. Volunteer for projects that give you an opportunity to meet leaders outside of your function. Start a group of men and women who actively promote and support each other. Know your personal values, interests, abilities and areas for development — and try to see yourself through others’ eyes.

Nancy Krawczyk is VP, marketing and corporate partnerships for the Network of Executive Women, Retail and Consumer Goods, a learning and leadership community representing 10,000 members, 750 companies, more than 100 corporate partners and 20 regional groups in the United States and Canada. Learn more at newonline.org.

| Progressive Grocer | Ahead of What’s Next | January 2017

JOIN A $2.4B POTENTIAL OPPORTUNITY BY 2020 1

This Snacking Moment Showcases Quality Ingredients & Better-For-You Attributes.

60%

of snackers wish there were more healthy snack options2

75%

of shoppers read food labels3

Sources: 1Mondelēz Volume Projections Based on Euromonitor Projected Category Growth & Added Value Snacking Landscape Insights 16, 2 Snacking Motivations and Attitudes, Mintel Group Limited, April 2015, 3Shopping for Health 2013, Food Marketing Institute

ADVERTORIAL

PREPARED FOODS INSIGHTS

In part one of a threepart series covering Tyson Foods’ Prepared Foods Challenge, four Chicagoland families set out to explore prepared foods like never before.

Mike Gebien and his daughter Miranda choose prepared ribs for their main dinner entrée on day two of the Prepared Foods Challenge.

Prepared Foods: A Fresh Conversation A unique experiment follows four busy families down their paths to the dinner table, uncovering failings and opportunities in the world of prepared foods. repared foods—they should sell themselves right? Consumers are busier than ever. Studies point to increased demand for fresh, healthier fare. Growth in away-from-home spending continues. What’s the problem?

Research from Springdale, Ark.-based Tyson Foods has suggested that today’s deli is “broken,” from out of stock SKUs at peak mealtimes, to dry, overcooked products, to poor customer service. A recent examination of the 25 top retailers in the country proved disappointing. “In every one of those 25, in every last one of them, the deli shopper’s satisfaction with the deli experience ranked significantly below their satisfaction with the total store experience,” said Eric Le Blanc, director of marketing for Tyson Foods. “We also checked on where deli ranks when people are making their decisions about what they want for dinner that night, and the answer was: we don’t rank. We’re not even on the map.” What does that mean for today’s groceries? What can retailers do to change consumers’ perceptions of the deli to boost business and store loyalty? Not surprisingly, the answer begins and ends with the consumer experience.

The Prepared Foods Challenge Inspired by the consequences of failure in the deli and prepared foods departments, Joe Khirallah, chief executive offi-

cer of Redwood City, Calif.-based marketing firm Green Bear Group, approached Tyson Foods with an interesting consumer-centric idea. Recruit four willing families with children and active lives and ask them to exclusively use prepared foods to assemble seven consecutive family dinners. “The idea was to give people an opportunity to do something they already do from time to time, force them to do it all the time and see how they respond,” said Khirallah. “Then we would give them some help. Let them learn, take the help away and see what sticks.” What followed was a decidedly open dialogue about the prepared foods experience.

A Tough First Few Days Days one through three of Tyson Foods’ Prepared Foods Challenge required the Keeley, Ramirez, Schnurr and Gebien families—all from the greater Chicagoland area—to independently source their dinners from the prepared foods departments of their local supermarkets. No recommendations or assistance of any kind was provided. Each of the families began the experiment with eagerness, optimism and distinct goals ranging from learning new ways to prepare more diverse, healthy foods that would simplify their

T YSON FOODS’ PR EPA R ED FOODS CH A L L ENGE PA RT ON E

“We started off the week with high hopes. We were all really excited, and it just went south fast.” — June Keeley lives, to spending more time with their families in the kitchen and at the dinner table. For the Gebien family of four, the Prepared Foods Challenge was an opportunity to eat healthier and break out of their dinnertime rut with new recipes, new flavors and new experiences. “We are trying to get the kids to eat healthier,” said mom Maryellen Gebien. “We have heart disease on both sides of the family, and we really try not to eat fast foods that often.” The first three days of the Challenge left parents and children from all families unimpressed at best, disgusted at worst. “We started off the week with high hopes. We were all really excited, and it just went south fast,” said June Keeley, a wife and mother of a recent high school graduate and a high school freshman. “We thought we could get whatever we wanted. We were going to have this amazing meal, and we came home and it was just really garbage. It was terrible.” The other three families had strikingly similar experiences. They gravitated toward the traditional rotisserie chickens groceries have long offered their customers, along with premade side dishes such as potato and macaroni salads. Other selections included a hodgepodge of random foods, from meat loaf, breaded onion rings, potato wedges and mushrooms, to pizza, tamales, ribs and wings. Overall, the meals lacked planning and any real variety.

The Keeley family makes the most of a mishmash of prepared foods.

we had food here, but not necessarily a sit-down meal. Everything seemed thrown together.” On day three the Keeleys chose steaks at the supermarket where they had them cooked on site. But between parking, choosing meal selections, waiting for their steaks and packing up the car, the whole experience lasted about 50 minutes— much longer than they expected from a meal comprised entirely of prepared foods. “That’s kind of a long time when you want to get something to go quickly and not have to think about it,” Bob Keeley said. “If you’re going to do this, it’s because time is of the essence and I think that’s why so many people hit the drive thru or make a phone call.” Adding to the four families’ frustrations, the prepared foods they brought home didn’t look or taste particularly good either. Ebony Ramirez, a mother of five, described the supermarket prepared foods as “dried out and burnt…like they had been sitting there all day.

While the Keeleys were craving a more cohesive meal by day two, dad Bob Keeley observed that good main entrée options besides the traditional and lemon pepper rotisserie chickens were hard to come by.

“We were lost for the first couple days,” she added. “We really didn’t know how to put the prepared food together … if the whole week was going to be like day three we would probably have starved because we’d be scared to eat the food.”

“It was like I knew we wanted to get the rotisserie chicken and then we’d add whatever. And at the end of the day, those meals tasted like a main course and whatever,” he said. “Obviously

Scott Schnurr, a father of three, agreed, noting that his initial perceptions about the quality and freshness of prepared foods were quickly dispelled. “I think the biggest disappointment was that the food wasn’t as good as we all expected it to be,” he said. “I honestly thought from the way it looked that I would get something like I get in a restaurant—something that’s freshly prepared and something that’s satisfying both visually and taste wise, and it was not. It was the opposite.”

Lisa Schnurr and her daughters Alyse and Amanda explore the prepared foods department.

Help on the Way After three days of handling the shopping and meal planning on their own—and achieving little satisfaction along the way, the Keeley, Ramirez, Schnurr and Gebien families were joined by Chef Charlie Baggs, executive chef and president of Charlie Baggs Culinary Innovations, for some guidance on days four, five and six. What the families discovered was that a little education and inspiration about the prepared foods experience goes a long way. Stay tuned for a report on days four, five and six of the Tyson Foods’ Prepared Foods Challenge in the February issue of Progressive Grocer. T YSON FOODS’ PR EPA R ED FOODS CH A L L ENGE PA RT ON E

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2016 Top Women in Grocery Gala Defines Perfect 10 Years!

apping a decade of commemorating the evolutionary strides females are making in the retail food industry, 273 of 2016’s 385-member class of Progressive Grocer’s Top Women in Grocery descended upon the Hyatt Regency Grand Cypress in Orlando, Fla., Nov. 9-10, to bask in the limelight, celebrate their accomplishments and accept individual awards before a sold-out crowd of more than 550. Hosted by Jeff Friedman, SVP/group brand director, EnsembleIQ, and Meg Major, PG’s chief content editor, TWIG’s 10th -anniversary celebration began with a casual cocktail reception on the eve of a daylong program designed to recognize the invaluable contributions of women from all walks of the retail food industry in three categories: Senior-Level Executives, Rising Stars and Store Managers. A dedicated daytime Leadership Development Program preceded the evening gala awards celebration, beginning with an optional Rise & Shine yoga session, followed by a networking breakfast sponsored by Post Consumer Brands. After breakfast, speaker, author and historian Robin Gerber took the stage to deliver a keynote presentation about the leadership lessons of Eleanor Roosevelt. Gerber also shared wisdom as a guest on a moderated executive panel discussion, which featured three of the grocery retail indus-

try’s top women leaders: the 2016 Top Women in Grocery Trailblazer award recipient Judith A. Spires, chairman and CEO, KB Holding Inc., parent of Kings Food Markets and Balducci’s; Kathleen Mahoney, EVP/chief legal officer, SpartanNash; and Susan Morris, EVP, retail operations, Albertsons Cos. After a break for lunch, Eileen Tarjan, manager of learning for the Network of Executive Women, led an Affinity Mixer. Concurrent with the daytime program, Procter & Gamble treated honorees to complimentary personalized wellness and restorative treatments in its Olay Lounge. Evening festivities kicked off with a cocktail party prior to the formal gala ceremony for Top Women in Grocery attendees, who were individually called forward to accept their award, along with a gold-stamped, long-stemmed red rose, before a contingent of industry leaders, colleagues, and friends and family from across the continent. Following the awards presentation, event guests enjoyed an afterdinner dessert and dance party, courtesy of The Hershey Co. The event wrapped with a 5K Fun Run/Walk, proceeds of which benefited the Network of Executive Women’s Future Fund, which aims to achieve 50/50 gender parity in food industry leadership. Nominations for the 2017 Top Women in Grocery awards program open on Jan. 2.

January 2017 | progressivegrocer.com |

Personalized Pampering Procter & Gamble treated Top Women honorees to complimentary personalized wellness and restorative treatments in the Olay Lounge, which gave attendees an opportunity to enjoy and experience customized, professional services in a serene, relaxed setting. By-appointment services included mini facials and reflexology massages, which P&G provided as a way to help honor the hard work and dedication of the guests.

L-R: KB Holdings’ Judy Spires, PG’s Meg Major, keynote speaker Robin Gerber, Albertsons’ Susan Morris and SpartanNash’s Kathleen Mahoney

Interactive Enlightenment

PG’s Meg Major welcomes attendees to the Leadership Development sessions.

Powerful speaker, best-selling author and historian Robin Gerber (left) delivered an insightful talk about the leadership lessons of Eleanor Roosevelt in her keynote address during the Leadership Development Program.

Author Robin Gerber giving the keynote address

Litehouse Foods’ Charity Hegel and Maria Emmer-Aanes (center, L-R), with their husbands, Dustin Hegel (far left) and Joe Aanes

Farm Fresh’s Kim Christie and Monica Elliott

The Tips From the Top panel discussion, moderated by PG’s Meg Major (far right) L-R: Weis Markets’ Anna Cucchiara, Elaine Cole and Wendy Sokol

L-R: DeCA’s Ester Garcia, Sharon Caskey and Carla Balido

L-R: IDDBA’s Mary Kay O’Connor, Albertsons’ Jewel Hunt and Midwest Dairy Association’s Cindy Sorensen

L-R: Post Consumer Brands’ Chrys Fromelius, Duane Meade, Mark Arrington, Maggi Mueller and Marj Bzdok

Kroger’s Hazelon Smith and Sencha’l Murphy

January 2017 | progressivegrocer.com |

Food Lion’s Kelli Whittington and Benny Smith (R), with Kelli’s husband, Mike

Acme Markets’ Vickie Babst and Cindi Aleardi

Raley’s Carla Dieffenbach with her husband, Robert

L-R: Albertsons’ Jewel Hunt, Susan Morris, Karen Sales, Brad Spooner, Joe Perry, Stacey Brown, Mike Barry and Dan Valenzuela

Kroger’s Julia Benitez, and her husband, Juan Rose, both Marine Corps veterans

L-R: SpartanNash’s Rene Hunter, Ed Brunot, Tia Billups, Ted Adornato and Carmella Cook

L-R: PepsiCo’s Stacie Riffert, Alice Humphrey, Christine Hagan, Ashley Ramkerath, Marla Daudelin and Amy Robinson

L-R: Hy-Vee’s Mary Fuhrman, Andy McCann and Sheila Laing

L-R: The Coca-Cola Co.’s Anne Gronek-Gibbs, Jessica Dawson, Lori Bates, Jim Brennan, Russ Fletcher, Kelly Marr, Pamela Stewart and Amy Valenzuela

L-R: Procter & Gamble’s Lauren Lefeber, Brooke Hoskinson, Alex Frankenthal and Tara Powell

L-R: JewelOsco’s Cheryl Corry and her husband, Tim; Hornbacher’s Jennifer Weisgram; Supervalu’s Sarah Louden; and Shopper Food & Pharmacy’s Leticia Thomas

Author Robin Gerber and Dave Jones, Kellogg Co. L-R: We the Light LLC’s Erica Wiederlight, Key Food’s Michele Gissi and PG ‘s Joan Driggs

L-R: Procter & Gamble’s Barbara Kelly, Christina Fuller and Barbie Blair

| Progressive Grocer | Ahead of What’s Next | January 2017

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Judy Spires Feted as 2016 Trailblazer

Marie Quintana, president, Velocity Marketing Group, served as emcee of the gala awards presentation

EnsembleIQ SVP/Brand Director Jeff Friedman

Judith A. Spires, chairman L-R: PG’s Meg Major, PepsiCo’s Marla Daudelin, 2016 TWIG/ NEW Trailblazer Judy Spires and JOH’s Bobbie O’Hare and CEO of KB Holdings Inc., parent company of Kings Food Markets and Balducci’s, was honored as the PG/NEW 2016 Top Women in Grocery Trailblazer, which recognizes a single industry executive whose leadership, vision and KB Holding President/CEO Judy Spires influence have helped break accepting her Trailblazer award new ground for women in L-R: Kings Food Markets’ Maryann Klejmont, Jessica Gasser, Laura Granston, Maral Banks, Carol the retail food industry. Donnoli, Monica Bonamego, Claudia Hauser, Lisa Prior to accepting the Durante and Richard Durante pinnacle award, key members of the Trailblazer award sponsor team – Meg Major, of Progressive Grocer; Marla Daudelin, of PepsiCo/FritoLay; and Bobbie O’Hare, of JOH, who represented the Network of Executive Women – offered personal tributes to Albertsons’ Elizabeth Erpelding and Dawn Mack Kroger’s Angie Steinberger The Hershey Co.’s Spires, who leads Parsippany, and her husband, Matt Stephanie Shein Berman N.J.-based Kings, a regional groand Jeff Harsh cery chain with 25 stores located throughout New Jersey, New York and Connecticut.

Cocktail reception before the awards presentation

PG’s Meg Major welcomed the 550 event guests. L-R: Albertsons’ Clarissa Hebert, Cathy Fields, Dione Baird and Connie Yates

Celebrating Kroger’s Top Women in Grocery are, L-R, Johnathan Moore, Kelli McGannon, Kathleen and Charles Wilks, and Sharon and Annie Roberts

| Progressive Grocer | Ahead of What’s Next | January 2017

Sweetening the Celebration Top Women in Grocery and event guests were treated to an after-dinner dessert and dance party, courtesy of The Hershey Co.

| Progressive Grocer | Ahead of Whatâ&#x20AC;&#x2122;s Next | January 2017

ar dd e Ch te hi W

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fresh meat seasoned with international sauces and the 67% who indicate they would buy seasoned meat tailored for speciﬁc dishes, Today’s Kitchen provides everything these consumers need to make life easier and their meals more interesting.

For more information on consumer motivation and Today’s Kitchen, contact a local Cargill sales representative.

Vice President of Sales and Marketing. “For foodies wanting ﬂavor but lacking in experience and prep time, we’ve created Today’s Kitchen.”

ALWAYS FRESH, never frozen, CASE READY FULL LINE OF MULTI-PROTEIN VALUE-ADDED MEATS SEASONED, PORTIONED, READY TO COOK ON-TREND FLAVORS *2015 Cargill Proprietary Red Meat Consumer Study, n=8,000

Racing Toward the Future The event concluded with a 5K Fun Run/Walk, proceeds of which benefited the Network of Executive Womenâ&#x20AC;&#x2122;s Future Fund, which aims to achieve 50/50 gender parity in food industry leadership.

Voni Woods, Giant Eagle

Jamie Larson, Meijer Cindy Sorensen, Midwest Dairy Association

Maha Eldabaja and Lori Corley, Albertsons Cos./ Tom Thumb L-R: Bobbie Oâ&#x20AC;&#x2122;Hare, JOH; Eileen Tarjan, NEW; and Joan Driggs, PG

Refresh for Success The scenic and serene grounds of the Hyatt Regency Grand Cypress provided an ideal backdrop for a restorative yoga session sponsored by Clif Bar.

January 2017 | progressivegrocer.com |

Store of the Month

Coborn’s Marketplace, Isanti, Minn.

Breaking New Ground By Jim Dudlicek

Coborn’s launches its next-generation look with a new store north of the Twin Cities.

Photography by Brandon Quesnel

or Coborn’s Inc., a new store in a growing community was the perfect opportunity to create a bold new image and up its game in all of its offerings to shoppers. The result is a supermarket that delivers pretty much everything a supermarket needs to have these days to be competitive, engender consumer loyalty and deliver a top-notch shopper experience. Serving a community largely made up of 30-something professionals and young families, the Coborn’s Marketplace in Isanti, Minn., is the culmination of a year of planning that included studying the latest shopping and eating habits, as well as researching other retailers in different parts of the country. “We are a company that is constantly striving to appeal to the changing needs of our guests,” says Chris Coborn, chairman, president and CEO of the St. Cloud., Minn.-based retailer. “We are excited to bring this new next-generation Coborn’s store to the community of Isanti and to the surrounding area. I think that our guests will be just as excited about this store as we are. It definitely has a ‘wow’ factor about it.” To be sure, this 51,000-square-foot store and its offerings far outstrip those of its closest competitors in this rural community an hour north of the Twin Cities, to where many of its residents commute to work. The store shares an intersection with two gas station/convenience stores in an area just starting to see more development. “The presentation of fresh foods, and the significant variety

| Progressive Grocer | Ahead of What’s Next | January 2017

aiming high The community has embraced the new Cobornâ&#x20AC;&#x2122;s marketplace format and its amenities that are unique to the area, acccording to Store Director mary Kruck.

Store of the Month

We want guests to feel eager to come to our store and view it as a well-rounded experience rather than just a routine trip to the grocery store.” —Chris Coborn, President and CEO

Coborn’s Marketplace, Isanti, Minn.

and assortment we’ve built into this store is impressive,” Coborn says. “We want guests to feel eager to come to our store and view it as a well-rounded experience rather than just a routine trip to the grocery store. The store really focuses on our fresh perimeter departments, yet has all the everyday essential grocery items that any guest routinely shops for at a grocery store.”

‘Bold New Look’ The new format includes an upper-level mezzanine and community room, and an entirely new interior and exterior design concept, with boutique-style destinations located throughout the store to showcase the various fresh departments. “Everything, from the exterior architecture to the interior signage, is a bold new look for us,” says Dennis Host, Coborn’s VP of marketing. “We call this store Coborn’s Marketplace to instill a sense of community in a more traditional market-like environment.” The store has an industrial feel to it, with large windows, exposed beams, a two-story ceiling deck, and industrial/rustic characteristics like polished concrete floors and exposed brick. As Host explains, it has “an upscale feel, but our prices are affordable and competitive,” and provides a “wow factor” that creates a unique shopping experience. “Our goal was to introduce new choices in full meal solutions, grab-and-go entrées and greater variety in more restaurant-like options as well as better-for-you items,” Host says. “Creating a pleasant shopping environment; offering items, services and

MILES OF AISLES The store’s upper-level mezzanine provides sweeping views of the sales floor below.

| Progressive Grocer | Ahead of What’s Next | January 2017

choices that appeal to the community; and being a full-service supermarket were all top of mind as we planned the layout and feel of the store.” Shoppers coming in the main entrance have several options for starting their Coborn’s experience in Isanti: They can head straight on into the produce department; they can veer left to the grab-and-go case, café seating area and Caribou Coffee; or they can belly up to the hot food bar. “The store’s focal point is a new centerpiece deli area called The Kitchen, serving made-toorder entrées that are packaged in-store for easy, convenient pickup and quick at-home preparation,” Host explains. “Brick-oven pizza, delicious sandwiches, and other grab-and-go breakfast, lunch and dinner options are just a few of the items guests will find in The Kitchen, in addition to a full salad and soup bar.” Guests will find expanded produce offerings in the Farmers’ Market, a high-ceilinged space decked out in rustic décor and trimmed with images and messaging that call attention to the local family farmers who supply fresh fruits and vegetables to the store, a feature that Host says “adds authenticity and credibility.” Organic items are prominent among the hundreds of products available. A unique destination is the Chop Shoppe, which offers freshly cut fruits and vegetables. While many stores have a fresh-cut program, Coborn’s takes it a step further, with cut-to-order service. Shoppers can have any produce item in

the store sliced and diced to their precise specifications, from potatoes for hash browns and cabbage for slaw to crudités for entertaining. “Shoppers are aspirational,” Host says. “It’s all about aspiration with ease.” Also available is an extensive line of fresh juices, made on premise from fruits and vegetables, using recipes targeting specific nutritional demands. Plus kids can grab a free apple or banana from a kiosk, standing at the perfect height, to snack on while shopping with their parents. The Flavors of the World cheese case features a huge variety of domestic and international offerings, curated and administered by a cheesemonger, while the Sushi Kabar counter offers a variety of sushi prepared fresh daily.

maRket dRiven High ceilings and rustic trim set the tone in the produce department, making the Farmers’ market true to its name.

Ready, Chef, Go! Enhancements continue into the full-service meat department. Isanti’s Meat Market boasts a 65-foot counter, “our largest service meat case in the company,” Host says. Among the items are Certified Hereford Beef selections, plus an in-house pitmaster mans the smoker that churns out ribs, chicken, Continued on page 48

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January 2017 | progressivegrocer.com |

Store of the Month

Coborn’s Marketplace, Isanti, Minn.

209 6th Ave. NE, Isanti, MN 55040 Grand opening: Aug. 17, 2016 Total square footage: 51,101 (45,608 main floor, plus 5,493 mezzanine) Selling area: 26,456 square feet SKUs: About 50,000 Employees: 135 Checkouts: 12 (five cashier lanes, four self-checkouts, two at guest services, Café checkstand) Hours: 24/7 Designer: Rice Building Systems, Sauk Rapids, Minn., in collaboration with Dennis Host, Coborn’s VP of marketing, and Brandon Anderson, Coborn’s graphic designer

| Progressive Grocer | Ahead of What’s Next | January 2017

January 2017 | progressivegrocer.com |

Store of the Month

Coborn’s Marketplace, Isanti, Minn.

loW AnD SloW A pitmaster mans the smokehouse, turning out ribs, chicken, brisket and sausage.

Continued from page 45

We actually had people crying because they were so happy we brought a store of this caliber to their town.” —Mary Kruck, Store Director

sausage and brisket. Also featured are signature smoked sausage varieties sold under the Four Brothers label, which Host explains is a nod to history, honoring the Coborn brothers who founded and grew the company. Other selections include marinated beef, pork and poultry; kabobs; beef patties; and brats. “The variety and presentation of choices allow guests to try new things and expand their horizons,” Host observes Coborn’s natural meat selections include grassfed beef and pork, Just Bare poultry, and grass-fed bison, lamb and veal. Of particular interest for time-pressed consumers is Ready-Chef-Go, the store’s line of heat-and-eat meals, priced at $4 to $7. Ready in four to six minutes right in their microwaveable bags, the meals feature a protein with complementary vegetables. Varieties include salmon with asparagus and pecan-crusted chicken with broccoli — again, all packaged in house. “Where else can you get such a healthy meal that’s ready in five minutes for four bucks?” Host remarks.

About Coborn’s Coborn’s Inc. began in 1921, when Chester Coborn opened a single produce market in Sauk Rapids, Minn. Today, the St. Cloud, Minn.-based, employee-owned company operates 55 grocery stores and 70 convenience, liquor and other retail locations throughout the Midwest. Coborn’s employs about 8,000 employees, including five generations of Coborn family leadership, and is currently led by fourth-generation President and CEO Chris Coborn. The company’s grocery store formats, located across Minnesota, North Dakota, South Dakota, Iowa, Illinois and

Seafood is flown in daily to Fisherman’s Wharf, which also offers value-added items such as bourbon-glazed salmon on a wood plank, crab-stuffed cod and lobster-stuffed Norwegian salmon. Rounding out the fresh area is the Bake Shoppe, featuring fresh-baked artisan breads and rolls, custom cake options (decorated by hand or with edible imaging), muffins, cookies, bars and pies. Consumers can order their bread sliced to order, guided by an on-counter thickness gauge. “We added some whimsy to our signage to make things fun,” Host says, noting the huge pastel blue-green industrial mixer that’s the focal point of the bakery area, along with the spinning cupcakes overhead and signage with quips such as “Be the office hero — bring donuts.” Coborn’s operates a central bakery at its St. Cloud headquarters to supply all stores with conventional goods like cookies, bagels and some cakes. Last summer, the company opened a dedicated gluten-free bakery. “Fresh-baked gluten-free offerings have been really popular,” Host notes. The design package for the dairy aisle aims to create a destination here as well. The Isanti County Milk and Dairy department comes complete with a talking cow and a red barn that pays homage to the county’s rich dairy-farming history.

Wisconsin, include Coborn’s, Cash Wise, Marketplace Foods and Save-A-Lot. Besides its brick-and-mortar grocery stores, Coborn’s operates CobornsDelivers and Cash Wise Delivers, online grocery-ordering and home delivery services. Coborn’s also owns and operates 35 liquor stores under the Coborn’s Liquor, Cash Wise Liquor and Captain Jack’s banners. The company further encompasses a fuel and convenience division, a pharmacy division, an in-house grocery warehouse and distribution center, an in-house central bakery, and Tops Cleaners. Coborn’s additionally operates Ace Hardware, Caribou Coffee, Country Floral, Dunn Bros. Coffee and Subway locations.

| Progressive Grocer | Ahead of What’s Next | January 2017

And everything in the store is available online through Coborn’s click-and-collect shopping service. Guests can place orders online on any mobile or desktop device and select a pickup time window, during which their order will be waiting in the staging area at the front of the store.

Skills Versus Personality The community response to the Isanti store has been overwhelming, according to Store Director Mary Kruck. “We actually had people crying because they were so happy we brought a store of this caliber to their town,” says Kruck, who will celebrate 21 years with Coborn’s in May. Her second-in-command, Assistant Store Director Michael Hauglie, began his career with Coborn’s as a produce clerk at age 16. Host says the biggest issue revealed since the store’s grand opening has been “the learning curve of settling into all the new offerings that are new and different than those that we’ve traditionally offered in our other stores. With more fresh offerings, we have a keener sense of what our guests are wanting and are flexing to meet those needs.” That flexing affected the way Coborn’s went

about hiring associates for the new store. “We have not been immune to the significant challenges of finding qualified talent to fill key roles, but have been truly impressed with the store team we’ve put in place,” Host says. “Many of our store associates in this location really had no previous experience in grocery retailing, much less specialty areas.” In fact, Coborn’s opted to “hire for personality and train on skills,” Host explains, indicating “people who can sell, are engaging and enthusiastic with our guests and have a passion for what they do. We’ve trained them on the technical or hard skills. It’s the soft skills we were most looking for, to create a much more dynamic shopping destination for our guests.” Bringing a next-generation format to market “has been incredibly rewarding,” he continues, “and as with anything new, there are always some challenges to work through. Most rewarding has been our guests’ acceptance and enthusiasm for the store. Our biggest challenges probably have been just the settling into the new norm of how the store will perform consistently. Just understanding what that looks like from week to week can sometimes be challenging, but thus far, we are very happy with the results, and performance has been solid.”

Creating a pleasant shopping environment; offering items, services and choices that appeal to the community; and being a full-service supermarket were all top of mind as we planned the layout and feel of the store.” —Dennis Host, VP of Marketing

Store of the Month

full Service The isanti store’s cheesemonger offers advice to a shopper looking for the perfect specialty cheese.

Coborn’s Marketplace, Isanti, Minn.

So much so, in fact, that Coborn’s has already incorporated features from the ground-up Isanti store into the “very comprehensive” October 2016 remodel of its Sartell, Minn., store, which first opened in 2006. “As consumers’ choices have widened and their wants and needs evolve, we are evolving with that. Today’s consumers have many choices, and their interest in quicker, healthier meal options continues to grow. We’ve positioned this store to meet that demand,” Host says. “So, as consumer demands and choices are evolving, we see the need to strategically position ourselves differently to meet those demands and evolve our formats to continue to be relevant.” And in doing so, Coborn’s Marketplace in Isanti offers the community a special shopping experience. “The look and feel of the store is unique, and our store team is highly engaged

with our guests,” Host says, “supporting them with terrific food options as well as deep knowledge about what we sell.” PG read about dietitian services at coborn’s Marketplace in isanti at progressivegrocer.com/cobornsrD.

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2017 Retail Outlook

Challenges Temper Optimism Retailers to focus on points of differentiation in 2017. By Joan Driggs, Jim Dudlicek, Bridget Goldschmidt, Randy Hofbauer, Meg Major and Katie Martin

he bleak macroeconomic landscape, including deflation, and various regulatory issues, such as the Affordable Care Act, Fair Labor Standards Act and minimum wage laws, may be keeping retailers up at night, but grocers large and small are entering 2017 optimistic about the Trump administration, which is viewed as largely pro-business. One of the hallmarks of the grocery industry is that hard times bring out the best in innovation. It will be called for in the coming year, as competition for the food dollar continues to expand to nontraditional outlets, including subscription services, e-commerce companies, and such nontraditional purveyors as home improvement and home goods retailers. Within traditional grocery retail, deep discounters, including Aldi and Lidl, the latter of which will make its U.S. debut by 2018, are a threat to retailers unable to compete beyond low prices. A point of difference in favor of traditional supermarkets, most agree, is customer service, which will be a focal point for many retailers. Expect those committed to the customer experience to invest more in recruitment, training and retention. Experience will extend beyond smiling faces to mobile communications and e-commerce solutions, but grocers admit the financial struggle of investing heavily in both in-store and virtual customer service. Assortment is also a focus for the coming year, as retailers indicate they’ll be investing more in their perimeter departments, notably fresh prepared food offerings. Grocers recognize that shoppers want the convenience of prepared meal solutions paired with the speed of takeout.

PG’s editors reached out to members of the retailer community to ask them these questions: What are your company’s top priorities for 2017? What areas of the customer experience will you focus on most closely? What do you consider to be the greatest challenges and opportunities for the industry as a whole? What impact do you foresee a new presidential administration having on the supermarket industry?

The following retail executives shared insights for our 2017 Retail Outlook: Maria Brous, director of media and community

relations, Publix Super Markets

Richard Cashion, VP of retail operations,

Healthy Home Market Chris Coborn, president and CEO, Coborn’s Inc. John Cortesi, president and CEO, Sunset Foods Kevin Davis, chairman and CEO, Bristol Farms Wayne Denningham, EVP and COO, Albertsons Cos. Scott Drew, EVP of operations, Smart & Final Stores Dan Glei, EVP of merchandising and marketing, K-VA-T Food Stores Inc. Heather Isely, EVP, Natural Grocers Lauren G.R. Johnson, CEO, Newport Ave. Market Art Potash, CEO, Potash Markets Dan Shanahan, president and COO, Buehler’s Fresh Foods Kirk Stoa, EVP and CFO, Festival Foods Jimmy Wright, owner, Wright’s Market By and large, they share many common goals, face common challenges and recognize common opportunities, while expressing what might best be described as cautious optimism about the retail landscape, the economy and what impact a new presidential administration might have on both in the coming year. Their responses follow, edited for space ... January 2017 | progressivegrocer.com |

2017 Retail Outlook

ayne Denningham, EVP and COO for Albertsons Cos., pinpoints store conditions, private brands and people as top priorities for the Boise, Idaho-based retailer, which has grown organically and through acquisitions over the past few years. As part of Albertsons’ quest to be the “favorite local supermarket” in each of the communities it serves, Denningham says sales growth and profitability will be driven by “maintaining our focus on running full, fresh, friendly and clean stores, as well as ensuring our products offer the quality and variety of natural, organic and local products customers know us for,” chief among which are its successful own brands like O Organics, Open Nature, Eating Right and Lucerne. Private label will continue to serve as a critical component of Albertsons’ future playbook, as will technology. “In 2017, we’re going to continue our focus on using Big Data and analytics to drive customer traffic and basket size through thoughtful price investment, loyalty programs and personalized offerings,” notes Denningham. “We’re also going to invest in our people and continue to be a company where people want to come work and build their careers.” For Kevin Davis, chairman and CEO of Carson, Calif.based Bristol Farms, 2017 will be about increasing sales at existing stores through more efficient promotion and merchandising, and improving the shopper service experience. The upscale grocer recently remodeled more than half of its stores, and while sales are up at all of those locations, Davis believes it can do a better job introducing the newly remodeled stores and their added features to new customers in communities it already serves. This also will be the year Bristol Farms opens the first of several new stores it will be debuting over the next 18 months, which, when completed, will mark the company’s biggest growth in history. A strong focus on people — internally and externally — will be top priority this year for Smart & Final Stores. Scott Drew, the Commerce, Calif.-based retailer’s EVP of operations, notes that his company will continue to focus on engaging and investing in associates through continued education, internal promotions and new hires. His company will also continue providing household and business customers with a differentiated offering and an updated, more convenient shopping experience. Chris Coborn, president and CEO of St. Cloud, Minn.-based Coborn’s Inc., says his company’s key focus will be further strengthening two of its core values: guest focus and executional excellence. “Our employees should

always be anticipating opportunities to provide remarkable service, even if it means deviating from the routine way of doing things,” Coborn says. Similarly, at Festival Foods, a De Pere, Wis.-based chain of 26 stores, a major focus of 2017 will be improving the guest experience — specifically, empowering store associates to “wow our guests,” says Kirk Stoa, the retailer’s EVP and CFO. “It can best be described as ‘random acts of kindness’ for our guests.” John Cortesi, president and CEO of Sunset Foods, says that this year’s priorities for his five-store chain in north suburban Chicago include a focus on fresh, including organics and prepared meals. “We’re competing with the likes of Blue Apron and other subscription services. We need to be more innovative, so we’ll also be focusing on digital marketing, applications and solutions,” Cortesi notes. “As we address Millennial shoppers, we’re focusing more on convenience and satisfaction.” Art Potash, CEO of Chicago’s Potash Markets, believes that growth — a major priority for 2017 — will come as a result in investments in training and development of staff, as well as physical upgrades of equipment. Lauren G.R. Johnson, CEO of Newport Ave. Market, in Bend, Ore., minces no words when identifying her top priorities for 2017: “Increased sales. Due to new competition in our area, we expect to remain flat through the first two quarters, then experience a slight increase.” Likewise, for Abingdon, Va.-based K-VA-T Food Stores Inc., which operates stores under the Food City banner in Georgia, Tennessee, Kentucky and Virginia, 2017 will be about “growing sales, given the challenging headwinds of deflation,” as well as “improving the shopping experience and the solutions we bring to our customers,” says Dan Glei, K-VA-T’s EVP merchandising and marketing. And Jimmy Wright, owner of Wright’s Market, in Opelika, Ala., says his top priorities are “finding innovative ways to grow profitable sales, in spite of food deflation and the competitive environment.” Of Healthy Home Market’s newest store, Farm 2 Family Foods by Healthy Home Market, set to open this month in Lenoir, N.C., Richard Cashion, VP of retail operations for the Charlotte, N.C.-based chain, notes, “With the new brand, our company is focusing on educating traditional grocery customers about healthier lifestyles and selecting the best products to meet their needs.” Nutrition education always has been a major focus for Natural Grocers, but 2017 will be a time to continue creating new, experiential ways to help customers know more about the foods they purchase, says Heather Isely, EVP of the Lakewood, Colo.-based retailer.

What are your company’s top priorities for 2017?

| Progressive Grocer | Ahead of What’s Next | January 2017

Continued on page 58

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Online CPG shopping is gaining ground It’s not hard to remember a time where grocers competed with other grocers, consumers made weekly trips to the store, and they could only find out what was on sale by checking out the circular. Those days are forever gone, as now grocers compete with everyone from drug to dollar to e-tailers. Younger generations have replaced weekly trips with more frequent stops at the store as well as making online ordering part of their routine. People can find out what is on sale on any given day, not just weekly, by engaging with digital media like mobile apps and retailer websites. Getting ahead of technology shifts that are impacting the various segments of your target audience can help inform strategy. Increase in online purchases: Adoption of online shopping for consumables is on the rise. Twenty-six percent of respondents to our recent Shopper Insight Survey in August indicated they buy CPG items online. Only a year ago that number was 13 percent, according to our 2015 survey. So what is driving this behavior? One word: convenience — 40 percent of respondents indicated that ordering grocery items online saves time. In fact, one in four 21-29 year olds think buying groceries online is more convenient than going in-store.

Do you think buying groceries online is more convenient than going in-store? 25 20 15 10 5 0 21-29

30-39

40-49

50-59

60 and over

Do you use your smartphone while grocery shopping? 35 30 25 20 15 10 5

Mobile creating a stir: How are people engaged while they are shopping? Judging from the number of instances where people are trying to walk down an aisle and it’s being blocked by someone on their phone, there is a lot of opportunity in mobile marketing. Market Track’s survey indicated the younger end of the demographic scale is most heavily participating, with 34 percent of 21-29 year olds indicating they are using their smartphones while grocery shopping. Most said they are either looking for additional discounts or checking their list. Being able to message them while in the store can provide a competitive advantage.

21-29

40-49

50-59

60 and over

Has a promotional offer on your mobile device caused you to change what you planned to buy or where you planned to shop? 37% No

Bonus—mobile causes unplanned purchases: More than 60 percent of respondents indicated that a mobile offer has caused them to alter course in their shopping journey, changing what they bought or where they shopped. The confluence of the digital and physical realms allows for in-the-moment tactics that can create opportunity.

30-39

| Progressive Grocer | Ahead of What’s Next | January 2017

63% Yes

2017 Retail Outlook Continued from page 54

or the past 86 years, Lakeland, Fla.-based Publix Super Markets has prioritized the customer experience in its stores, through its “stellar customer service [and] quality products at competitive prices,” in the words of Maria Brous, director of media and community relations, and that’s not about to change now. Additionally, according to Brous, “we continue to look towards providing meal solutions for our customers, convenience, grab-and-go items and omnichannel [solutions].” Albertsons’ banners, meanwhile, will offer online ordering and home delivery in eight of the nation’s top-10 most populous MSAs by the middle of next year, according to Denningham. “Our own employees are involved at every step of the process, from packaging to delivery,” he explains, because “we believe e-commerce should be an extension of the in-store experience, with the same high level of customer service and quality fresh products that our customers have come to expect from us.” Albertsons will also “continue to enhance and upgrade our stores and our health-and-wellness services across all our banners in the new year,” Denningham adds. 2017 won’t be without its trials for Bristol Farms, the greatest centering on consumers’ continual perception of a flat or slow-growth economy, Davis admits. Additional pressure will come from ever-increasing operating costs from various new government regulations taking effect, including new minimum-wage laws, overtime changes, the Food Safety Modernization Act and new menu-labeling laws, in addition to rising health care costs. “Our focus remains on developing product categories with strong potential to build customer visits, such as our natural and organic … private label offerings, which resonate with customers and are attracting new ones,” Drew says. “Additionally, we are executing customer growth initiatives through our delivery platform relationships with Instacart and Google Express, which appeal to the Millennial customers, and are introducing Smart & Final to a mostly incremental new audience.” Coborn says providing his customers “an exceptional shopping experience” is a top priority. “We will continue to seek out more fresh, healthy options for our stores; our registered dietitians will continue to provide creative new ideas to inspire healthy eating strategies for our guests; and we will continue to evaluate our practices to make sure we are living this vision.” As with many retailers interviewed for this feature, Stoa believes that people help deliver extra “value” to the shopper. Marketing efforts, including online advertising, in-store sig-

nage and shelf tags in the coming year will focus on the many ways that Festival Foods creates value for its shoppers. From the Tot Spot free child care while shopping in the store, to curbside pickup, Festival’s new tag, “It’s the little things …,” will help draw attention to these extras. Festival is also focused on store growth through acquisitions and new stores. Stoa notes that competition in Wisconsin, which has seen growth from larger regional players like Hy-Vee and Meijer, and the acquisition by Kroger of Roundy’s, continues to squeeze small independents. “You swim harder, swim faster and be the consolidator, or get swallowed by those sharks,” he says. “So we’re focusing on growth.” Sunset’s Cortesi says he sees consumers — particularly Millennials — as desiring to be self-sufficient. “Customers want to get in and get out [of the store],” he observes. “Look at the revelation taking place with [the] Amazon Go store. We want to create the speed and efficiency customers are looking for.” Sunset already offers a wide variety of prepackaged prepared foods, he notes. “Now our goal is [to] merchandise effectively to satisfy the needs of consumers. We already have the full kitchens on site, so we want to compete against foodservice,” Cortesi notes. “We can change quickly and come up with healthy options that address a variety of health issues.” Prepared foods is more than a catchphrase at Potash Markets, as the small Chicago independent “continues to strive to be the most relevant we can be for our customers,” Potash asserts. When it comes to improving the customer experience, K-VA-T is interested in “expanding meal solutions in the fresh departments, growing the center store through events that drive basket size on stock-up trips [and accelerating] snacking options throughout the store,” Glei notes. The new year will see Natural Grocers also responding to increased outreach from customers on social media. The retailer plans to make it even easier for patrons to connect and engage via its various channels in this area. Similarly, Wright says he’ll be focusing on tech improvements in POS technology and online shopping. To enhance the customer experience at its four stores, Healthy Home Market plans to concentrate on “new health trends, educating customers on a healthier lifestyle, online shopping, and our relationship with local growers and producers,” Cashion notes. Come what may, Johnson affirms that Newport Ave. Market’s top focus, “as always, will be on customer service. We believe that is one of a handful of advantages we have over our competition.”

What areas of the customer experience will you focus on most closely?

| Progressive Grocer | Ahead of What’s Next | January 2017

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2017 Retail Outlook

hen assessing the industry’s foremost challenges and opportunities, Albertsons’ Denningham says that regardless of how the grocery industry evolves or innovates, “it’s always going to be a business built on pennies and very small profit margins. But what we have learned over the last decade ... is that customer service drives sales. “While our industry is about driving what the customers want,” Denningham notes that “it’s also about remembering who our customers are, and maintaining those relationships. That isn’t something that you can mandate as a corporate mission; it needs to happen organically, store by store. That’s both the greatest challenge and opportunity throughout the industry.” Challenges aside, Davis is certain that Bristol Farms, as it does every year, will head into 2017 with optimism and a strategic plan to do better, no matter what the circumstances, pointing out that tough economic conditions can sometimes help efficiently run companies perform even better. And although new competition will enter California, continued grocer consolidation will act as a buffer against sales loss to these food retailers, he adds. According to Cortesi, Sunset’s challenges for 2017 include deflation. “Food costs are low; profitability is much different,” he says. “There are many regulations in the industry. We’re challenged in finding good people, so recruitment and training will be something we focus on in the coming year.” Likewise, Coborn says lingering deflation continues to be a challenge. “While changes like this are cyclical, and eventually things will get better, the long duration of this trend has created a tough environment for grocers across the country. However, even with challenges come great opportunity,” he notes, pointing to the company’s new Marketplace format (see this issue’s Store of the Month, starting on page 42). Wright considers deflation and a “hypercompetitive operating environment” the top challenges grocers will face in the new year, with innovation being the key opportunity: “Difficult times always bring out the best in us.” Although a changing grocery landscape and recent deflationary pressures have proved to be major challenges for the overall grocery industry, Smart & Final finds its greatest opportunity in its differentiated model to serve both business and household customers. Over the years, it has successfully maintained its community approach. Festival Foods is investing in its e-commerce and

mobile experience, which Stoa sees as both a challenge and an opportunity. Food safety “continues to be one of those things that keeps retailers up at night,” admits Potash, whose stores are located in downtown Chicago. Other major challenges he cites include compliance and more government regulation and oversight. In that vein, Natural Grocers’ Isely suggests that perhaps the greatest challenge will come from the Safe and Accurate Food Labeling Act of 2015 — called by some GMO labeling advocates “the DARK (Denying Americans the Right to Know) Act” — which bans states from requiring food manufacturers to label food ingredients that come from genetically modified crops. But while these types of rulings are worrying, Isely stresses that they also present an opportunity to reward vendors that choose to be transparent. “Retailers who continue to educate their customers and require transparency from their vendors will see greater customer loyalty,” she asserts. Newport Ave. Market’s Johnson points to “increased competition with other retailers — including restaurants — especially as the big chains improve in the specialty category.” And at Publix, “increased competition and new competitors entering existing markets remain a focal point,” Brous says. For his part, Cashion sees potential ahead. “One of the greatest opportunities in our industry is the ability to reach a large market of consumers and test new trends,” he asserts. “We pride ourselves on not doing the same thing as everyone else.” Despite the challenges of rival industry players, Glei remains optimistic. “Supermarkets that provide a relevant offering, coupled with [a] great customer experience ... will continue to grow in spite of an intensely competitive landscape,” he asserts. “Our challenge and opportunity is to better anticipate, understand and deliver what our customers expect than our competition.” Dan Shanahan, president and COO of Wooster, Ohiobased regional grocery chain Buehler’s Fresh Foods, contends: “It’s possible that we need to be more things to more people and we need to expand our core competencies, perhaps by looking for creative new partnerships, collaborations and alliances. Making things better for our core base while simultaneously embracing these multiple significant trends will allow us to stay relevant and lead the way.” PG

What do you consider to be the greatest challenges and opportunities for the industry as a whole?

How do retailers feel about the new presidential administration? Find out at progressivegrocer.com/trumpretailers.

| Progressive Grocer | Ahead of What’s Next | January 2017

THIS IS WHERE I REALIZE

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GARY ZICKEL Chicago, IL Manager of Food Operations, Mariano’s Attendee since 2001

Whether brainstorming an exciting new prepared-foods concept or getting down in the trenches to make sure every sushi bar, grilling station and smokehouse is running just right, my days are hectic enough to make it difficult to stay on top of key developments in our fast-expanding segment. Which is why, each May, I carve out time from my busy schedule to attend NRA Show®. It’s here—walking the Show floor, attending seminars, connecting with industry experts—that I find the inspiration to continually improve my operation. And keep my customers coming back for more.

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In-store Strategies

Health & Wellness

Make it Better With nutrition increasingly on the minds of shoppers, grocers need to up their game. By Bridget Goldschmidt

ost food retailers have some sort of health-and-wellness program in place, but as consumer interest in clean labels, nutritious eating and healthy lifestyles increases, grocers’ current offerings may not be enough. A responsive, dynamic approach to health and wellness is crucial for grocers. As Karleigh Jurek, corporate dietitian for Lubbock, Texas-based United Supermarkets, observes: “A well-established health-and-wellness team can be beneficial for retailers by providing a needed service that resonates with today’s guests that could promote stronger loyalty from these shoppers and ultimately increase sales.” Citing “several educated assumptions” from her organization’s Health and Wellness Council, Susan Borra, chief

wellness officer at the Arlington, Va.-based Food Marketing Institute (FMI), executive director of the FMI Foundation and a registered dietitian (RD) herself, affirms that “consumer values around health and wellness will continue to grow in importance and continue to be a key purchase driver. Riding the trend for consumer-centered health care, more customers than ever before are looking for health care options, and the neighborhood grocery store has the ability to fulfill this need and serve as a wellness advisor.” In terms of products, Carl Jorgensen, director, global thought leadership-wellness at Stamford, Conn.-based Daymon, points out that “health and wellness is the fastest-growing trend at retail. Natural and organic sales are projected to grow 11 percent annually through 2020. Retailers are seeing the opportunity for their private

January 2017 | progressivegrocer.com |

Health & Wellness

In-store Strategies

brands to offer consumers a less-expensive entry point to health-and-wellness products.” So, what can grocers do to address consumers’ evolving needs?

Well to do Coborn’s healthand-wellness team consists of, from left, Rds Amy Peick, Ashley Kibutha and emily Parent.

First, they need to realize that there’s no onesize-fits-all solution. Elisabeth D’Alto Jalkiewicz, supermarket/retail subgroup chair of the Food and Culinary Professionals dietetic practice group at the Academy of Nutrition and Dietetics, in Chicago, urges retail dietitians to “learn about your associates, your customers and the community you are serving. I think it’s important to not generalize that all retail dietitians should be taking the same cookie-cutter approach. Depending on things like your geographic region or your primary shopper, you have to tailor programs to meet those specific needs.” St. Cloud, Minn.-based Coborn’s is already on board with this directive. “We are focused on meeting our communities where they are at,” notes Amy Peick, who oversees the Midwest grocer’s health-and-wellness program. “Our communities have both similarities as well as differences. Each of them has different needs and expresses their interest in different areas of wellness. Our supermarket dietitians in the store have the capability to be flexible with events and activities that are offered to our guests.” (For more about Coborn’s, see PG’s Store of the Month feature on page 42.)

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June 3-5, 2017 Hyatt Regency Orange County Garden Grove, CA The symposium is three days of relevant content, interaction and invaluable peer networking. We have developed a dynamic program for 2017 that will continue to inspire and connect retail dietitians with solution providers. Qualified retail dietitians and nutritionists can request their invitation by contacting Joan Driggs at JDriggs@ensembleiq.com or at 224-632-8211. Sponsorship packages are available. Contact Maggie Kaepple at MKaeppel@ensembleiq.com or at 630-364-2150.

www.progressivegrocer.com/retaildietitian2017

| Progressive Grocer | Ahead of What’s Next | January 2017

Here’s what attendees said about the 2016 summit: “A wealth of information and great networking.” “Very innovative, applicable, and empowering experience.” “Valued vendor partnership and business focused solutions.”

Health & Wellness

In-store Strategies

This program customization should extend to the various demographics served by supermarkets. “In recent years, a major topic of discussion is the rise of Millennials as consumers, and how best to reach this group while still resonating with older age groups,” says United’s Jurek. “This will continue to grow and develop, especially with Generation Z beginning to reach adulthood. Health-and-wellness teams will need to continue to adapt the messaging to methods that appeal to these different groups.” Additionally, when publicizing their health-andwellness offerings, retailers should directly address convenience. “The key is to really resonate with consumers’ needs by targeting your promotions or merchandising efforts to provide meal solutions like quick weeknight dinners, one-pot meals or top-10 pantry staples,” suggests Jalkiewicz. Accordingly, Coborn’s is touting the convenience of a new feature in its newest locations. “As we follow trends within health and wellness, we see that individuals are searching for convenience,” says Peick. “However, we are finding that many of them still want to be engaged in a simple

Health and Tech Retailers are just starting to take advantage of innovative technologies in designing and promoting their health-and-wellness programs. “Technologies such as mobile, augmented reality and virtual reality are key to high-impact health-and-wellness merchandising,” says Carl Jorgensen, director, global thought leadershipwellness at Stamford, Conn.-based Daymon, citing Whole Foods Market’s Whole Body Mirror, which, he notes, “attracts shoppers with a playful look at their ‘aura,’ and then suggests a related health product.” Beyond the supermarket channel, Jorgensen points to Rite Aid’s in-store tablet, which guides customers through a process to find the right supplement for their needs, and Walgreens’ private-brand Well at Walgreens activity tracker, a wearable fitness monitor that directly competes with such well-known brands as Fitbit, Garmin and Jawbone. “It is the first private-brand activity-tracking wearable,” notes Jorgensen. “The tracker also syncs with the Walgreens Balance Rewards app for smartphones and the Apple Watch, and awards participants points for logging weight, tracking blood pressure and glucose levels, and fitness activities.” For her part, Karleigh Jurek, corporate dietitian with Lubbock, Texas-based United Supermarkets, affirms that “with the development of new technologies, the health-and-wellness field will see unique methods arise to help relay related messages. New technologies, and how these teams choose to use them, will be an area of major change.”

| Progressive Grocer | Ahead of What’s Next | January 2017

form of the overall cooking process. From these trends we have implemented a Chop Shoppe in our next-generation stores. The Chop Shoppe is the spot where we chop your fresh produce however you’d like it. This is extremely convenient for our shoppers to increase their consumption of fruits and vegetables without having to take the time to prepare them.” There’s also the issue of visibility. “It’s both difficult and expensive for dietitians to be personally on the floor at all times,” notes Jorgensen. “However, they can be visible in other ways, such as through at-shelf communications like ‘Our dietitian recommends’ and ‘Did you know?’ signage.” He additionally advises that dietitians offer store tours for customers, incorporate access to their services into telephone and online customer service offerings, and work hand-in-hand with store pharmacists to better connect grocery and pharmacy.

Partners in Health As Jorgensen indicates, health-and-wellness programs enable retailers to engage with customers beyond the food aisles. Jalkiewicz also urges in-store dietitians and pharmacists to work together more. “Building an excellent referral system between dietitians and pharmacists is a great way to grow your one-on-one consultations with customers, and also for dietitians to refer customers back to the pharmacist if they have questions regarding medications,” she explains. “Dietitians and pharmacists can also team up during health screenings in the store and in the community.” “Drug interactions, diet regimens and supplements are all areas of the store where the pharmacist can help guide the shopper and work more strategically with the supermarket RD to positively influence their shoppers’ lifestyles,” notes Borra. “There are excellent opportunities for pharmacists and dietitians to help patients with their diet questions and treatment needs.” Pharmacists can boost their visibility through at-shelf communications similar to those suggested for dietitians, Jorgensen observes, as well as offer private-brand precision wellness services. “Pharmacists can make personalized dietary and lifestyle recommendations based on data from wearable activity trackers, DNA test kits, blood biomarkers and microbiome analysis,” he says. “This is also an opportunity for retail dietitians.” The idea is that “the dietitian can perform the role of the pharmacist’s extension throughout the store,” asserts Jorgensen. “Daymon believes that bringing pharmacy and grocery together is one of the most compelling opportunities for retail in the next few years.” He further advises that category managers and

merchandisers also get involved in health-andwellness programs “to get dietitian- and pharmacistrecommended products and communications in front of shoppers,” and that “training of store employees by pharmacists and dietitians will help activate healthand-wellness programs across the store.”

Change Agents Meanwhile, in the retail trenches, many supermarket health-and-wellness programs are perpetually being refined to better meet consumers’ needs. “As we see an increase in demand for health-andwellness resources, Coborn’s plans to expand the dietitian program,” notes Peick. “This would include

hiring additional RDs, building more nextgeneration stores with continued emphasis on fresh departments around the perimeter of the store, and healthier options in convenient foods and ready-made meals.” Coborn’s “continually expanding” program features three RDs, each covering a different region of stores, who network with local businesses and organizations, along with offering such services as store tours, personal consults, lunch and learns, classes, and nutrition education presentations and events. Other health-and-wellness efforts at the grocer include the NuVal nutrition guidance system, healthy checkstands selling only Dietitian’s Choice items, and free fruit available in the produce department for kids to snack on. “We will be [further] implementing our Dietitian’s Choice program in our stores by having shelf tags on all of those items,” says Peick. “With the trends [of] looking for healthier convenience food items, we will potentially add more healthy checklanes [and] more Dietitian’s Choice items in fresh departments, as well as develop programs for kids that focus on healthy eating, physical activity

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Health & Wellness

“In the future, we hope to continue to grow our media presence as well as developing a voice on different digital platforms through social media outlets, blog posts and online videos.” —Karleigh Jurek, United Supermarkets

In-store Strategies

and an overall healthy lifestyle.” Coborn’s additionally plans “to expand on corporate wellness initiatives and healthier break-room options,” she continues, further noting the “many opportunities to be innovative with our fresh departments.” To get the word out about its program, Coborn’s uses such channels as social media outreach, radio shows, TV segments, blogs, newsletters, brochures, handouts and recipes, according to Peick. When it comes to communication, spurring greater digital engagement is key. “In the future, we hope to continue to grow our media presence as well as developing a voice on different digital platforms through social media outlets, blog posts and online videos,” says Jurek, of United, whose current healthand-wellness initiative consists of three full-time registered dietitians and nine contract dietitians providing such services as store tours and themed media segments across various outlets; Health Tags, which quickly identify at the shelf those foods that are beneficial to specific health conditions and dietary preferences; and Dietitian’s Top Pick items. “Our team also hopes to see more point-of-sale advertising through digital messaging found directly in the stores,” adds Jurek. “We hope this will

helps us create more interaction with our guests and engage them with our health-and-wellness team.” Jalkiewicz predicts even more activity in cyberspace. “I think we may see more health-andwellness efforts integrated into the online shopping programs for many retailers,” she says. “If customers are using a delivery system to order groceries through the retailer, and not stepping foot in the store, those are missed opportunities for dietitians to have an impact and educate those customers on their health-and-wellness needs.” Again, Coborn’s has begun to move into this space with its To The Table meal kits, available through the CobornsDelivers delivery service. The kit, according to Peick “contains a recipe with everything needed to cook a quick and easy meal in your own home.” Through such endeavors to adjust their programs to shifting consumer demands, Jurek believes that “health-and-wellness teams have a very unique opportunity to help differentiate [their companies] from other competitors in the industry.” PG For more about in-store health-and-wellness programs, visit progressivegrocer.com/hwprograms.

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| Progressive Grocer | Ahead of What’s Next | January 2017

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Grocery

Soup

Part of the Solution Soup can be positioned as an integral component of a healthy diet. By Bridget Goldschmidt

Soups could be used as a piece of a weight loss program, as some of them provide good nutritional value and are low in calories.” —Eric B. White, Redner’s Markets

t Redner’s Markets Inc., soup is increasingly synonymous with better health. “The trend has moved to more healthy options in soups,” affirms Eric B. White, director of marketing for the Reading, Pa.-based chain of 45 Warehouse Markets and 21 Redner’s Quick Shoppe convenience stores throughout eastern Pennsylvania, Delaware and Maryland. “Consumers are more health-conscious, and Baby Boomers as well as Millennials are concerned more about health.” Moreover, White believes that “soups could be used as a piece of a weight loss program, as some of them provide good nutritional value and are low in calories.” To promote this idea, Redner’s featured Campbell’s new Well Yes! Soup line in its Health Cents newsletter.

Big News Featuring what the Camden, N.J.-based Campbell Soup Co. calls “positive and purposeful ingredients to deliver against consumer desires for cleaner, less processed food choices,” Yes Well! comes in such varieties as Black Bean with Red Quinoa, Hearty Lentil with Vegetables, Hearty Tomato with Toasted Barley,

| Progressive Grocer | Ahead of What’s Next | January 2017

Italian Vegetable with Farro, and Minestrone with Kale, all packaged in BPA-free cans and containing no artificial colors or ingredients. To promote the new line, the company is launching a full-360 activation this month that includes consumer promotions, a Well Yes! website and Facebook page, digital and TV ad campaigns, instore displays, and public relations efforts. “Partnership with our retailers in building consumer awareness of this amazing product is key to the brand’s success,” says Jim Sterbenz, SVP of sales for Campbell U.S. “We know that this product will really resonate with our shoppers, and supports Campbell’s real-food journey.” Campbell has also continued its focus on meal solutions through events with retail partners and an uptick in its in-store execution of soup-and-sandwich-oriented displays in partnership with its Pepperidge Farm division. Other meal solution efforts from the company include the recent relaunch of CampbellsKitchen.com, which offers an abundance of recipes using many of its brands. Among the site’s new features is a Kitchen Guide section that provides users with every-

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Our soups are great on their own, or as a base for additional creativity.” —Roger Galloway, Progresso

Soup

thing from simple tips to expert advice to help home cooks of all experience levels. Fellow major soup brand Progresso, part of Minneapolisbased General Mills, has also been busy addressing the trend “towards wellness and greater transparency in areas that include ingredients and production quality,” as Progresso Senior Marketing Manager Roger Galloway puts it. Accordingly, the brand’s recent moves include Progresso Good Natured Soup, a line of three vegan items containing three-quarters of a cup of vegetables per serving, and a switch last September to antibiotic- and hormone-free chicken in all of its chicken soups, making it the first mainstream soup manufacturer to make such a claim. “We believe that soup provides a great option at mealtime, combining vegetables, grains, and protein in one easy-to-eat format,” Galloway says, adding that “our soups are great on their own, or as a base for additional creativity. To increase the awareness about all the great options at mealtime that our soups can provide, we have introduced ‘Up a Notch,’ a section on the Progresso website dedicated to taking our favorite soups and creating new mealtime options in minutes by adding fresh and unexpected flavor combinations.”

Extending Opportunity “Consumers are looking for products that are a natural extension of their lifestyle,” notes Kelly McCann, brand manager for Tualatin, Ore.-based Pacific Soups. “This means soups that fit in with their dietary needs, whether they’re looking for glutenfree, plant-based, low-sodium or high-in-fiber foods. Having a product that can help consumers with portion control … is key.” This past summer, Pacific expanded its creamy soup line with Roasted Garlic & Potato and vegan Organic Tomato Basil, and also added two new hearty soups, Organic Vegetable Masala Stew and dairy-free Hearty Coconut Curry. “Consumers continue to show interest in more complex, vibrant flavors, and many are also starting to include more plant-based meals in their diets,” observes McCann. In the area of meal solutions, the company aims “to formulate soups that work on their own as a meal or pair well as part of a larger meal,” she says. “Soups can also be especially useful as an ingredient in casseroles or pasta dishes to help reduce meal preparation time while still providing healthy options for busy individuals or families.”

| Progressive Grocer | Ahead of What’s Next | January 2017

Mix and Match Noting that soup “has proven to be very popular among Millennials who view it as a healthful and affordable meal option,” Trisha Anderson, founder of Gurnee, Ill.-based Frontier Soups, observes that the company has experienced growth related to such attitudes among that coveted demographic, as well as the current interest in “assembled ‘fast-scratch’ or ‘speed-scratch’ meals” like those offered by online delivery services. “This is essentially what Frontier Soups has done for many years, providing the basis for a meal with all the dry ingredients and spicing in the mix, while the home cook adds broth and other grocery ingredients to create the soup,” she says. Among Frontier’s newest launches are Montana Creekside Classic Chili Mix and Southwestern Sausage & Chickpea Stew Mix, expanding the company’s highly popular Southwestern portfolio. The company actively encourages consumers to customize its soup mixes to meet their own specific wellness needs. “Soup’s health benefits and ability to be adapted to individual tastes are important, and we think emphasizing those features helps educate consumers about the important role soups can play as a practical meal solution,” asserts Anderson. “Frontier Soups’ consumers ... like that our mixes have no salt added, so they can control the amount of sodium. We also [encourage] them to modify our recipes to substitute ingredients their families prefer, or to add more nutrition.” Frontier’s website now offers nutritionist recommendations for each of its soups. For the new Classic Chili, consumers are advised “to cut saturated fat by substituting ground turkey, extra-lean ground beef or bison for the ground chuck, or to go vegetarian by using a mix of onion, red pepper, zucchini and mushrooms to replace the meat,” she notes. Further, merchandising that brings together all of the makings for a meal has been beneficial for the brand. “When our mixes are merchandised with ingredients used to prepare or accompany our soups, we have experienced a sales lift, such as in an end cap or off-shelf display with broth and crackers,” says Anderson. “We have this done recently at The Fresh Market stores.” The company has also teamed with a broth company to hold demos at Albertsons stores. Whether as a supporting player or the main event, soup can amply solve consumers’ meal dilemmas, but good nutrition must remain uppermost. As Redner’s White asserts, “Manufacturers will need to continue to update their healthy message if they want future consumers to purchase their product.” PG For more about soup, visit progressivegrocer.com/soup.

Category Management

Beverages

Taste Sensation Increasingly sophisticated palates are making grocers rethink the beer and wine category. By Randy Hofbauer

lthough U.S. consumers continue to enjoy beer and wine as frequently as always in the comfort of their homes or in bars, at-home consumption clearly rules. Between 66 percent and 76 percent of consumers drink beer, wine or spirits at home at least once per week, compared with the 23 percent to 26 percent who go out to imbibe once per week, according to a new report from Chicago-based IRI. There’s a certain amount of confusion in the aisles, however: Beer, wine and spirits shoppers make in-store shopping trips more than once per week, and 40 percent of buyers walk in undecided as to what product to purchase. This suggests that grocers have an opportunity to take stronger control over the category to help grow overall sales.

All About Lifestyle Beer is all about matching lifestyles. And lifestyle trends are forcing manufacturers and retailers alike to rethink their approach to managing the beer category. Tim Burke, director of category solutions at Chicago-based brewer MillerCoors, notes that consumers have increasingly sophisticated palates, enjoying more upscale and craft offerings. This growth in sophistication shows that more than ever,

the customer truly is king. “In 2017, the beer industry has the opportunity to win by refocusing and executing on category management fundamentals like balanced assortment discipline, price gap management and impactful displays to delight our shoppers,” he says. “Shoppers’ expectations are evolving and intensifying, their occasions and lifestyle needs are changing, they have more access at their fingertips, and they are redefining their demands for value. So we need to amplify our displays, simplify and improve shopability, and ensure we are delivering value across our portfolio of beer.” Vikas Sayal, senior director of commercial marketing with White Plains, N.Y.-based brewer Heineken USA, also notices such consumer trends, adding to them the growing relevance of lighter options for consumers focused on healthy living, and Mexican brews to match the growing prevalence of Hispanic culture. Of course, while speaking these consumers’ language is key to better reaching them, it’s also critical for grocers and suppliers to speak the same language with one another. Sayal stresses the importance of doing so when aligning a joint business plan — the primary step to becoming shopper-centric. “This means understanding their organization’s key pillars, strategy, leadership team needs, and coming to them with customer- and shopperfocused solutions that increase traffic and crosscategory purchases,” he explains. For the shopper, the best thing grocers and their supplier partners can do is work together to communicate with shoppers more effectively via a true path to purchase: pre-store, in-store and post-purchase. “Part of this is through in-store, online and digital means,” Sayal says. “The other is seeking to understand our shoppers’ attitudes and behaviors in everything we do by talking directly to them.” Appealing to the shopper involves such methods as developing platforms that attract by consumption occasion, segmentation according to consumer type and lifestyle, and reinventing the beer aisle via lighting, space usage, signage, educational engagement, and more, all to better grab shopper atten-

In 2017, the beer industry has the opportunity to win by refocusing and executing on category management fundamentals.” —Tim Burke, MillerCoors

January 2017 | progressivegrocer.com |

Beverages

The challenge is to balance offerings from the larger corporate entities, as well as extremely small operations.” —Scott Atkinson, Western Supermarkets

Category Management

tion. This can’t be a one-size-fits-all approach, as what works for one grocer may not for another. As for tools to aid in managing the beer category, Burke notes that MillerCoors is leveraging several new ones alongside a blend of traditional and nontraditional research with its retailer partners. These include virtual testing, receipt capture, in-store behavioral advances and geo-locating.

A Balancing Act Much like beer, wine has both large-scale producers and smaller operators in the mix. “The challenge is to balance offerings from the larger corporate entities, as well as extremely small operations, which only make tiny amounts of wine,” but can offer more exciting bottlings, says Scott Atkinson, wine consultant for Western Supermarkets, a Birmingham, Ala.-based independent chain that won “Best Wine Shop” in Birmingham magazine’s 2016 Best of Birmingham awards. It’s about balancing not just the big with the

small, but also the old with the new. “Those values from the familiar Italy, Spain and France, as well as relative up-and-comers such as Portugal, South Africa, Greece and even Slovenia ... continue to engage the consumer,” Atkinson says. Additionally, grocers are finding that they’re having to work with suppliers to stock and promote sparkling wines more often during the year than just around holidays, as sparkling wine is now more of a year-round treat. And not just any sparkling wines: Atkinson stresses that his customers are getting more selective and savvy about the types of sparkling wines they want, pushing his company to widen selection in this segment. Sales of sparkling Prosecco wine have been climbing for a few years,

Beverages

Category Management

but it’s serving as a gateway to the entire sparkling wine category, which includes such items as Spain’s cava. Rosé wines, too, are seeing their status rise as seasonal purchases begin to fade. Atkinson recalls when customers wanted dry rosés only during hotter months: His team would start “Rosé Season” in the spring, with stock diminishing through Thanksgiving. “We still carry more rosé wines during warmer weather, but consumer demand has led us to maintain a strong and diverse core of rosé wines from various geographies and price points,” he says. Curtis Mann, Raley’s director of wine, beer and spirits, also sees rosé’s popularity gaining at the West Sacramento, Calif.-based grocer, which Wine Enthusiast magazine recently named Wine Retailer of the Year. He warns, however, that the wine type also is seeing issues with quality inconsistency. But no matter what the selection, it’s a grocer’s ability to listen and respond that determines its success in wine. Raley’s prides itself — and has built its award-winning wine department — on analyzing data

| Progressive Grocer | Ahead of What’s Next | January 2017

to understand trends and optimize in-store sets, looking outside the data to be in front of and even create trends, and being generally active on social and other forms of local media to educate consumers about wine. But within its stores, Raley’s certified wine stewards lend an ear and answer questions to help customers find their perfect wine. Listening and responding also helped Western Markets grow its renowned wine department. Atkinson notes that his team works hard to listen to requests from customers, even intuiting what the customer doesn’t say but might truly mean. “We often help our customers,” he says, “by asking four or five — or more — questions for every question they ask us.” PG For more about beer and wine category management, visit progressivegrocer.com/beerwinecatmanextra.

Refrigerated Foods

Healthier Choices

Healthy Chill Desire for fresher, better-for-you options creates opportunities in refrigerated foods. By Randy Hofbauer

With an eye on the success of farmers’ markets, CSA programs and related trends, including home delivery of fresh milk by local dairies, supermarkets are making a point of featuring locally produced products, which, in turn, have become very sophisticated.” —David Sprinkle, Packaged Facts

t’s well known that consumers increasingly are striving to live more healthful lifestyles, and that their purchasing behaviors are changing rapidly as a result. Take nutrition labels: Half of all U.S. adults read the Nutrition Facts label always or most of the time, according to the 2014 Health and Diet Survey from the Food and Drug Administration, published in May 2016. On labeling, claims such as “all natural,” “GMOfree,” “no artificial colors,” “no artificial flavors” and “natural flavors” are ranked as “very important” to North American consumers when making food purchasing decisions, reports Schaumburg, Ill.based market researcher Nielsen in its 2015 “Global Health and Wellness Report.” And roughly onequarter feel the same about the term “organic.” For grocers looking to offer more products with claims like these, refrigerated foods are a prime area of opportunity, as consumers are ever more focused on fresh, and therefore, refrigerated

| Progressive Grocer | Ahead of What’s Next | January 2017

foods, says David Sprinkle, publisher at Packaged Facts, a division of Rockville, Md.-based MarketResearch.com. So what are grocers and CPGs currently doing to provide solutions here?

Minding the Meat A significant opportunity for better-for-you foods lies particularly in the meat case, where brands and grocers are challenged by consumer perception that processed meats aren’t healthful. Some 38 percent of U.S. consumers cite “all natural” as the most important factor when purchasing red meat — especially beef, notes Chicago-based market research firm Mintel in its November 2016 Category Insight on meat, poultry and fish. “Consumer perception of the healthfulness of processed meats remains a key challenge for the category,” Mintel says, adding that while brands have “[s]tepped up clean-label innovation efforts, opportunities remain to increase development of products that address consumers’ health concerns

through streamlined formulations and clear labeling.” Several brands, such as Oscar Mayer, with its Selects Natural Applewood Smoked Ham luncheon meat, have helped ease consumers’ minds by incorporating celery juice, extract or powder to replace conventional curing preservatives such as nitrites and nitrates, which some believe are potentially carcinogenic. While celery extract doesn’t offer a complete solution to removing added nitrites and nitrates, it does provide the clean-label solution valued by consumers. Artificial ingredients are particularly unnerving for Jeremy Zavoral, manager of the Hormel Natural Choice brand from Austin, Minn.-based processor Hormel Foods, as he believes consumers strongly value “real” food without the fake taste and appearance of many mainstream products. “But that doesn’t mean flavors can’t be as bold as the conventionally produced enhanced products,” he insists. “For example, Hormel Natural Choice deli meat launched applewood-smoked

turkey, which is deli meat that has been smoked over real applewood chips — not [using] liquid smoke — to give it an authentic flavor.” What’s desirable, however, among natural foods — especially refrigerated meats — is high protein content, Zavoral stresses. Consumers want products that are free from artificial preservatives while still keeping them fuller longer and supporting healthy muscles. This has resulted in an expansion of natural meat products in grocers’ refrigerated cases. Cincinnati-based grocer Kroger and Hormel, for example, both are working to expand selection in cleaner meats that also support satiety and muscular development. Kroger has implemented dedicated natural meat sets to bring together all of these types of products in one easy-to-shop set, regardless of product category. Meanwhile, Hormel is addressing this trend by delivering protein-packed natural products across the refrigerated case under the Hormel Natural Choice brand, including natural deli meat, pepperoni, bacon and ham.

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Refrigerated Foods

Healthier Choices

Quality Counts in Dairy With dairy, healthfulness and purity also are essential, and a number of brands are committing more to purity promises with their traditional fluid milk offerings. For its DairyPure brand, Dallas-based dairy processor Dean Foods has developed a Five-Point Purity Promise, which ensures that milk has no artificial growth hormones, is tested for antibiotics, is continually quality tested to ensure purity, comes from cows fed a healthy diet and is cold-shipped fresh from consumers’ local dairies. “Since the brand’s launch in 2015, we’ve focused on line extensions, including half-and-half, creams and lactose-free,” says Greg Schwarz, VP of marketing at Dean Foods. “The brand’s attributes align with the growing consumer trends to enjoy products that

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are pure, fresh and local.” “Local” is a keyword here for natural products in supermarkets — across all categories, including dairy. “With an eye on the success of farmers’ markets, CSA programs and related trends, including home delivery of fresh milk by local dairies, supermarkets are making a point of featuring locally produced products, which, in turn, have become very sophisticated,” says Packaged Facts’ Sprinkle. As for eggs, the industry has seen a large number of grocers go cage-free, but one in particular has actually gone a step further. Jonathan Clinthorne, Ph.D., manager of scientific affairs and nutrition education at Lakewood, Colo.-based Natural Grocers, notes that his company sells only free-range eggs or better, as they represent the highest-quality product and most humane treatment of egg-laying hens.

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The Beyond Burger, a Plant Power plant-based burger that Of course, whether it’s looks, cooks and tastes meat or dairy, the growing like fresh ground beef. health-focused trend involves Austin, Texas-based natuconsumers seeking to eat ral grocer Whole Foods fewer animal-based products Market partnered with Bealtogether. Meg Carlson, yond Meat to be the burger’s president and CEO of Prosperexclusive seller between its fall ity Organic Foods Inc., a Boise, 2016 debut and the end of that Idaho-based manufacturer of plant-based “butyear, stocking the product in both the meat departter,” notes that with 38 percent of households now ment and in the dairy/alternative food section to following “flexitarian” eating regimes, it should be appeal to both carnivores and non-meat-eaters. no surprise that people are growing more interProsperity’s Carlson anticipates that an increasested in healthful fats — specifically plant-based ing interest in ethically, sustainably sourced and ones — as well as plant-based alternatives to minimally processed foods and beverages that deliver traditional animal-based products. multiple nutritional benefits will continue, encouragDairy, for instance, is a major category for planting manufacturers to continue innovation in plantbased alternatives, and Denver-based WhiteWave based alternatives to animal-based foods. But in Foods is one CPG expanding its presence here. Lauthe end, she stresses, it’s up to retailers to give these ren Tankersley, WhiteWave’s director of marketing emerging products the attention and time needed for research, notes that her company is launching various success in their respective categories. PG plant-based products such as Silk protein-enhanced nut-based milks, featuring a blend of almond and cashew milks, and containing 10 grams of soy-free, For more about better-for-you refrigerated foods, visit progressivegrocer.com/bfyrefrig. plant-based protein per serving. On the retailer side, Natural Grocers’ Clinthorne sees not just cashew and almond milks hitting shelves, but also coconut, flax and hemp varieties. Technological advances today are even allowing for better-tasting butter alternatives. Carlson notes that Prosperity’s Melt organic butter substitute, made from a blend of beneficial fruit- and plant-based fats, not only sells in stick and spread formats, but also has the same melt and smoke points as traditional butter, making it suitable for cooking. As for meat, animal protein alternatives continue to grow as more shoppers reduce their overall meat consumption, according to Beena Goldenberg, CEO of Cultivate Ventures, a division of the Lake Success, N.Y.-based manufacturer Giorgio is America’s favorite mushroom because of our quality and the Hain Celestial Group that invests in vast choices we offer in fresh mushrooms from our whole and sliced smaller, innovative businesses. Specififresh mushrooms to organics, specialty items like our portabella caps, cally, its line of Yves Veggies Cuisine, and much more. Giorgio Fresh is a family-owned, third generation now Non-GMO Project Certified, offers veggie alternatives to everything company, focused on meeting consumer demands. from breakfast meats and lunchmeats to taco filling and hot dogs. Similarly, 301 Inc, the new busiyou can’t pick a ness development and venturing unit better partner than of Golden Valley, Minn.-based processor General Mills, has backed BeGiorgio Fresh Co. yond Meat, which recently launched 347 June Avenue, Blandon, PA 19510 800.330.5711 | www.giorgiofresh.com its first refrigerated meat alternative,

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Fresh Food

Prepared Foods

Ready or Not

Growth in away-from-home eating means supermarkets must continue to improve their fresh prepared food offerings. By Lynn Petrak

f rotisserie chicken spun a new competitive advantage for supermarkets a couple of decades ago, today’s prepared food offerings reflect an even greater turn of fate — and arguably fortune — for grocers. Although competition for the consumer food dollar remains tight, with supermarkets vying with restaurants and meal kit delivery services to provide fast, simple and appetite-appealing meals, the outlook for grocery prepared foods remains positive. Several research organizations project continued expansion and success of prepared foods offered in supermarket settings. In an October 2016 brief, Mike Kostyo, senior publications manager of Chicago-based Datassential, declared that supermarket prepared food departments are the fastest-growing segment of the foodservice industry, and predicted that the category will grow 3.8 percent in 2017. Prepared foods accounted for 58 percent of the $24

billion in deli sales in mid-2016 and are considered an emerging driver of growth, according to“The Power of Fresh Prepared/Deli,” a study commissioned by the Fresh Foods Leadership Council of the Arlington, Va.-based Food Marketing Institute (FMI). Rick Stein, FMI’s VP of fresh foods, says that supermarkets are doing well in this area for a variety of reasons. “One thing that supermarkets have to their advantage is that their food safety has been at the high end of consumers’ trust,” Stein says. “Also, they are differentiating themselves because consumers are already buying groceries — they often go to the grocery store, they know where to park, which aisles to go down, which checkers to talk to. So most supermarkets have a good brand already, and consumers know and trust them.” Supermarkets also have a leg up over some meal kit delivery services. During his 2017 trend forecast webinar, “Supermarket Guru” Phil Lempert contended that meal kit

| Progressive Grocer | Ahead of What’s Next | January 2017

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Fresh Food

Today’s consumers demand transparency in product origins, ingredients and production; seek out missionbased retail options; support hyperlocal products; and demand quality.” —Geoffrey Wexler, Wakefern Food Corp.

Prepared Foods

delivery services may encounter some obstacles. “More stores are starting to have meal kits similar to the ones you’d get from HelloFresh or Blue Apron, but less expensive,” Lempert noted,” so I see in-store meal kits continuing to rise because of that meal kit phenomenon.” For their part, retailers report a growing emphasis on prepared foods. Earlier in 2016, FMI commissioned research to survey retailers representing 8,000 stores, focusing on the sophistication of supermarket fresh prepared foods. While 8 percent of respondents reported total store sales growth of more than 5 percent, 69 percent reported that same level of growth or much higher in their prepared food departments. In addition, 88 percent of the store banners polled said that they have a corporate executive chef on staff. Wakefern Food Corp., the largest memberowned retail cooperative in the United States, has experienced growth in prepared foods as its members “push the envelope” with their offerings, according to Geoffrey Wexler, VP of foodservice for the Keasbey, N.J.-based company. “We know that the expectations and demands of today’s customers are significantly different from those just five years ago. Our consumers are far more food-centric and food savvy,” Wexler says, adding that such savviness translates to a more discerning shopper. “Today’s consumers demand transparency in product origins, ingredients and production; seek out mission-based retail options; support hyperlocal products; and demand quality.” Other retailers have homed in on, and responded to, changing consumer knowledge of, and preferences for, prepared foods. “As food retailers continue to prove to customers that they can deliver fresh and high-quality prepared foods offerings that meet the needs of their busy schedules, customers’ expectations of these offerings also evolve,” says Dan Donovan, spokesman for Pittsburgh-based grocery chain Giant Eagle Inc. “As they do in other departments, such as produce when possible, many customers are interested in prepared foods offerings that are more healthful, locally or regionally sourced, and personalized.”

Variety Show Employing chefs on staff is one way to boost a prepared food department, especially at a time of strong competition with restaurants and other take-home or make-at-home meal providers. “Retailers are investing a lot in this area,” Stein notes. “There are more

| Progressive Grocer | Ahead of What’s Next | January 2017

corporate chefs and more store chefs than there have ever been.” Chefs can lend authority and innovation to prepared foods, qualities that resonate with consumers. According to the “Power of Fresh Prepared/Deli” study, although 96 percent of shoppers purchase deli/fresh prepared foods once a year, only 12 percent think of visiting the deli regularly when deciding what to do instead of cooking dinner; the report emphasizes that food retailers who want to stay competitive with foodservice “need to focus on elevating the profile of deli/fresh prepared as a key differentiator and thus the driver of sales for the entire store.” By hiring chefs and focusing on flavor, many grocery stores have already elevated the profile of their offerings. Datasssential’s report, for example, revealed that a third of consumers say that the variety and quality of prepared foods have improved. To stay competitive in terms of quality and variety, Kostyo says that grocers and in-house chefs should continue to find ways to think outside the box. “Now that supermarket prepared foods are competing with nearby coffee shops, fast-casuals and other trendy restaurant concepts, not to mention growing delivery services, retailers really have to start broadening their view and looking at what’s happening across the industry to understand what customers want,” he advises. Anne-Marie Roerink, principal at San Antoniobased 210 Analytics, which conducted research for the “Power of Fresh Prepared/Deli” study, agrees that grocers and grocery chefs should keep that question in mind — What do consumers want? — as they develop their prepared food offerings. Roerink suggests that stores first meet baseline expectations on fresh prepared staples like rotisserie chicken, sandwiches and pizzas, and then work on other, up-and-coming items. “Once the basics are perfected, stores can expand to become a true deli destination that is a viable restaurant alternative in the eyes of the shopper. This includes a much wider variety of items of on-trend foods to elevate the consumer perception,” she says, noting that grocery stores are well positioned to deliver on innovation. “Grocery stores that have been able to build a reputation and destination by innovating and staying above the trend with flavors, ingredients and customizable options have given restaurants a run for their money.” “You’re starting to see supermarkets with a station for pizza, a station for salad, and a station for sushi or Mexican food,” Stein concurs. “They can switch those over time, like maybe switching sushi to Mediterranean sandwiches, if those become

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Fresh Food

Prepared Foods

popular. While variance is important, you have to have mainstays like rotisserie and fried chicken, and grab-and-go sandwiches.” On the topic of customization, Kostyo says that grocery prepared food programs have an edge in not only giving customers what they want, but also helping them create their own meals. “Consumers love customization. In fact, con-

sumers chose customizable hot pizza as the No. 1 unique offering that they wanted to see in the supermarket prepared foods area, while madeto-order burritos and tacos also scored high,” he observes. That trend can be expected to continue as more Millennials and Generation Z consumers come of age. “They are used to the personalized experience at a fast-casual, or ordering exactly what they want from their phone or an instore ordering system,” Kostyo notes.

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Working Together As they offer prepared foods that provide customers with the flavors and formats they seek, grocers can bolster their success through collaboration. “Suppliers can also step in and help operators understand what’s going on in the market — the concepts, menu items and ingredients that are trending on menus and popular with consumers,” Kostyo recommends. Donovan points to the benefits of collaboration, from a retailer’s perspective. “Just as our customers are often starved for time, retailers, too, must continue to find efficiencies in time and resources when delivering these delicious, high-quality meal solutions,” he says. “Suppliers have a great opportunity to create unique partnerships by offering solutions such as bundling components, allowing retail team members to spend less time creating dishes and more time servicing the customer.” Those who supply ingredients and products to grocers for prepared foods say that they are proactively looking at trends and shopper demands in the R&D process. Greg Powers, CEO of Boulder Organic Foods, in Niwot, Colo., heads a company that works directly with retailers “to develop new profiles that reflect consumer preferences on flavor, nutrition and ingredients. Since all of our products are ready to eat and represent the ultimate comfort food, we try to stand apart from the field by offering organic and gluten-free foods that are healthier than most alternatives,” he says, citing newer profiles that represent a clean-label version of traditional offerings such as tomato bisque or potato corn chowder. Houston-based Perfect Fit Meals is another supplier seeking to fill in the gaps for healthy prepared foods, with

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Fresh Food

Prepared Foods

fresh-made heat-and-eat portion-controlled meals. “In the grocery segment, a lot of people don’t realize there is a healthy prepared option,” notes Andrew Hsueh, Perfect Fit’s president and founder. His company’s prepared foods are high in protein and fiber, and “low in everything else,” Hsueh asserts. Likewise, the current consumer clamor for protein can be a boon for suppliers and their retail partners. “We have experienced requests in the hot-food deli section, with offerings like hot bars and takehome seafood protein components to supplement other food groups,” says James Faro, director of sales for National Fish & Seafood, in Gloucester, Mass. “Also, many of our retail partners ask for biannual to quarterly innovations to complement the weather season or holiday season.”

Grocery stores that have been able to build a reputation and destination by innovating and staying above the trend with flavors, ingredients and customizable options have given restaurants a run for their money.” —Anne-Marie Roerink, 210 Analytics

Making the Connection Beyond serving prepared foods that fit shoppers’ tastes and preferences, stores can maximize sales and differentiate themselves in how they promote and merchandise the items. From her conversations with shoppers as part of the research for the “Power of Fresh Prepared/Deli” study, Roerink discovered that one of the biggest findings was how the majority of shoppers only know about a store’s prepared food program by seeing it or experiencing it for themselves. “Retailers have an enormous opportunity to connect with shoppers in meaningful ways at the crucial planning hour with daily specials, meal ideas, mixand-match ideas, using social media, mobile and text messages,” she says. “That requires shopper buy-in and trust, but if retailers can prove to be part of the everpresent ‘what’s for dinner?’ dilemma, they can quickly rise as a viable restaurant alternative that shoppers deem healthier and less expensive.” Kostyo suggests making the prepared food area a convenient destination instead of just setting out foods and hoping shoppers will come. According to Datassential’s findings, shoppers want menu boards and limited-time offers so they can try new foods; they also have high expectations for speed of service, staff friendliness and décor.

| Progressive Grocer | Ahead of What’s Next | January 2017

Additionally, supermarkets can distinguish their offerings and connect with consumers by providing healthier or wholesome choices in their prepared food sections and letting consumers know about those options. “One way in which retailers are educating customers is through increased ingredient labeling, particularly as prepared foods continue to be an attractive solution for families,” Giant Eagle’s Donovan says. “This trend has been a healthy challenge to retailers to be more mindful during the recipe creation process, without compromising on the need to deliver a delicious-tasting item or meal.” In addition to labeling, other packaging elements can lead to more effective merchandising of prepared foods. “Packaging is becoming very important,” Stein asserts, adding that consumers are interested in packaging that protects the integrity of prepared foods, is attractive and, when possible, is environmentally friendly. “Also, packaging can generate more sales, depending on the packaging you use. Labels, for example, connote quality and food safety. I really think supermarkets are leading the way with prepared foods packaging.” Suppliers that provide packaged prepared foods also focus on packaging as part of the overall product profile. Perfect Fit Meals, for example, is developing new packaging that will allow customers a better view of the product, so “that what you see is what you get,” as Hsueh puts it.

Staying Competitive Looking ahead, the pace of innovation in prepared foods is set to continue. “As a differentiator, prepared foods afford us a tangible way to continue to compete against club stores, dollar stores and alternative formats that could possibly lure customers away,” notes Wakefern’s Wexler. “Moving towards the future, we will continue to invest in programming that addresses the shifting meal preferences of our customers. From an innovation standpoint, it’s an exciting time to be in this dynamic industry.” In his long-term forecast, Lempert predicts that prepared foods will likely undergo another iteration as the buying and selling landscape changes. “We’ll see delivery-only restaurants and delivery-only grocery stores,” Lempert says, noting the buzz around the new Amazon Go store at which shoppers use a mobile app to automatically purchase products in a digital shopping cart, eliminating the need for in-store checkout. “They are making prepared foods in the store ready to pick up and go.” PG

Produce

Fresh Food

Munching Mania

Fruit and vegetable snacking could be the key to a healthier America. By Jennifer Strailey

s consumers increasingly turn to fruit and vegetable snacking as part of a healthy lifestyle, grocers have an opportunity to boost sales with a variety of convenient products like sliced apples, easy-peel citrus, and mini tomatoes and peppers. Pittsburgh-based Giant Eagle, for one, has begun offering free fresh fruit to kids while they shop with their parents, who may peruse the grocery store chain’s expanded selection of fruit and vegetable snacks. “In response to the growing popularity of convenience-oriented produce offerings, we have introduced ‘healthy snacking’ displays within the produce departments in a majority of our supermarket locations,” notes Jannah Jablonowski, Giant Eagle spokeswoman. “These displays make it easier for customers to shop value-added and convenience items, and they have resonated well with Giant Eagle customers. Offerings in the healthy snacking section are often promoted in-store with shelf tags.”

Snacking Surge “Snacking trends are incredibly important to the produce industry,” asserts Victoria Nuevo-Celeste, of Pasadena, Calif.-based Sun Pacific. “According to Nielsen, fruit and vegetable snacks are the second-largest snack category.”

Nielsen’s “Share of Snacking Product Dollars Across the Store” report found that fruit and vegetable snacks represent 24.9 percent of the category, just behind salty snacks, at 25.1 percent. “All signs point to produce snacking continuing to grow as consumers continue to lead busy, onthe-go lives, but are also more health-conscious,” says Nuevo-Celeste. “Snacking is a trend that is here to stay — for so many reasons,” affirms Joan Wickham, director of communications for Sunkist Growers, in Valencia, Calif. “In today’s busy lifestyle, consumers are looking for convenience,” continues Wickham. “More and more, people are eating smaller meals and snacks throughout the day instead of the traditional three meal parts. At the same time, consumers are also looking for ways to eat cleaner and healthier foods — fresh produce fits the bill for this.” Sunkist is working to educate consumers about citrus snacking in general, and lesser-known varieties specifically. “Cara Cara oranges, as an example, pack a nutritious punch with 20 percent more vitamin C and nearly 30 percent more vitamin A than regular oranges,” explains Wickham. “What’s more, they are deliciously sweet and a pretty pink color due to the natural presence of lycopene, a powerful antioxidant.”

In response to the growing popularity of convenienceoriented produce offerings, we have introduced ‘healthy snacking’ displays within the produce departments in a majority of our supermarket locations.” —Jannah Jablonowski, Giant Eagle

January 2017 | progressivegrocer.com |

Fresh Food

Produce

Millennial Moms Health-conscious Millennials are driving growth in produce-based snacking. “Millennials are really important to brands and retailers, as they are now the largest adult demographic, and also make up 90 percent of new moms,” notes Nuevo-Celeste. Sun Pacific’s marketing campaign for Cuties this season targets Millennial moms and their kids. The campaign focuses on digital channels where these mothers and their children engage. The company has updated Cuties’ Lil’ Zipper character for animated TV spots, created a video content series, and enhanced packaging and instore merchandising design. The launch of a Cuties Snapchat lens, which featured Lil’ Zipper, saw nearly 70 million brand exposures in just 24 hours, more than four times Snapchat’s benchmark. Encouraging kids and their families to try new fruits is another focus for Sun Pacific, which recently introduced Mighties Kiwi. The brand features a kid-friendly character, along with simple instructions on how to cut, scoop and eat a kiwi. Select packages offer the added convenience of a spife (spoon/knife combo).

All signs point to produce snacking continuing to grow as consumers continue to lead busy, onthe-go lives, but are also more healthconscious.” —Victoria Nuevo-Celeste, Sun Pacific

Young Bucks With industry branding efforts such as the “Sesame Street” eat brighter! campaign forged by Sesame Workshop and the Produce Marketing Association in 2013, and the cause marketing campaigns of organizations like Orlando, Fla.based Produce for Kids, which has helped families and children eat healthfully and give back since 2002, youngsters are an increasingly important focus of the produce industry. They also represent a tremendous market for growth in produce and produce-based snacks. “Kids wield over $1.5 trillion dollars in purchasing influence over their parents and approximately 40 percent of all U.S. households have kids,” notes Sarah Cottrill, VP of sales and marketing for Richland Center, Wis.-based apple grower and processor Richland Hills Farms. “When you break that down even further, research shows us that parents of kids actually eat healthier and make healthier snacking decisions to help their kids develop healthy habits early in life,” she adds. This past fall, Richland Hills, which had been primarily a foodservice supplier, rolled out branded packaging for its apple slices in Wisconsin and other Midwest states. “We grow our apples here, and it allows us to take advantage of less food miles and creating a direct connection with our consumers,” explains Cottrill.

| Progressive Grocer | Ahead of What’s Next | January 2017

Richland Hills offers seasonal favorites like Honeycrisp apple slices, and plans to add sliced pears and grapes to its product mix in the coming years. The company is currently working on planting commercial volumes of both fruits so it can continue to offer a local product. “The produce industry has a huge role to play in snacking trends when it comes to kids,” asserts Nuevo-Celeste, of Sun Pacific, which is partnering with McDonald’s for the third year to offer Cuties in Happy Meals and as an à la carte option. “It’s really important that the produce industry look at how to make fruits and veggies even more appealing to kids — especially as snacks, since kids tend to need and want to eat between meals,” she says. “It’s important for the success of our business, but it’s also the right thing to do to help ensure the health of future generations.” Packaging that attracts the attention of kids and their parents is critical to success in the produce-based snack category. Sunkist offers kidfriendly fruit in fun, colorful packaging through its Lil Snappers product line, a partnership with Wenatchee, Wash.-based Stemilt. “We offer the varieties that kids love — sweet seedless mandarins, tangy Minneola tangelos, vibrantly sweet Cara Caras, and classic Navel and Valencia oranges as part of this brand,”notes Wickham. Sunkist and Stemilt also offer a pink bag that combines Pink Lady apples and Cara Cara oranges.

Crunchy Cravings Produce-based snack suppliers are now competing with salty snacks and sweet treats for a share of snack time in America. Nick Desai, of fruit and vegetable-focused Snack it Forward and World Peas, notes that while consumers say they want to eat healthier, “Lays and Doritos are growing at 5 percent a year.” Los Angeles-based Snack it Forward, which has licensed the Sunkist mark for its trail mixes since 2013, is enticing consumers to get more produce in their diets with better-for-you snacks that offer the experience and crunch of traditional chips. The company recently introduced Sunkist True Fruit Clusters in four varieties. The Clusters, which start shipping this month, represent “a new take on the whole freeze-dried world,” says Desai.

“They have a different texture and offer a different eating experience than traditional freeze dried profile snacks,” he notes. “They’re bite-size and crunchy, not chewy and gummy.” Each bag contains five fruit servings, with no additives. In the pulse- and bean-based snacking realm, World Peas will introduce Cheddar Fava Crisps and Chipotle Fava Crisps next month. “We’re using a larger, higher-quality fava bean that tastes more like a potato,” Desai says. According to Desai, inconsistent product placement represents one of the biggest challenges to sales of produce-based snacks. “Depending on the store, consumers might find these products in four different places,” he observes. What’s more, if these snacks are merchandised alongside traditional snacks in center store, they can’t begin to compete on price per pound, Desai adds. “Consumers want natural, clean ingredients, but there’s a cost to that,” he admits. “The merchandising locations for these snacks are important to let customers know that they can always come to the same place to find this class of snack.” Desai points to Bentonville, Ark.-based megaretailer Walmart, which has had success creating a

section featuring the Sunkist/Snack it Forward line in the produce department. Fyffes North America Inc. is also seeking a share of the crunchy produce-based snack market. “The [produce-based snacking] trend is certainly in its early-to-mid stages and has room for growth and continuation,” says Carolina Coulson, product manager—snacks—tropical division for Fyffes, in Coral Gables, Fla. This year, Fyffes designed and launched a variety pack composed of its top-three-selling flavors of Fyffes Plantain Chips. The pack offers six individual 1-ounce bags. “Our plantain chips are healthy snacks that are GMO-, gluten- and cholesterol- free, with no additives, preservatives or trans fats,” notes Coulson. “Our chips should be strategically placed to optimize sales, and the best place is out of the chip aisle and near other healthy items like fresh-pressed juices, produce or other healthy snacking options.” PG

The [producebased snacking] trend is certainly in its early-to-mid stages and has room for growth and customization.” —Carolina Coulson, Fyffes North America

For more about marketing and merchandising produce snacks, visit progressivegrocer.com/producesnacks.

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PG’s 2016 Produce Power Session

Fresh Food

Trading Partners Explore

Opportunities, Challenges Retailer and supplier executives convene to address the hottest topics in fresh produce.

By Jennifer Strailey

rom must-have flavor to price wars to connecting with the consumer, Progressive Grocer’s 2016 Produce Power Session tackled some of today’s hottest topics in produce. Held Oct. 14, 2016, in Orlando, Fla., just prior to the Produce Marketing Association’s (PMA) Fresh Summit, the event brought together leading suppliers and retailers from the United States and Canada for a candid discussion about the ever-evolving produce industry.

Elevating Emotion “Produce elicits the highest emotional response in the store,” said Michelle Adams, founder of Marketing Brainology, a Richardson, Texas-based consulting practice focused on translating consumer and shopper insights for marketing and corporate America. “Effective merchandising breaks through the customers’ trance as they shop,” continued Adams, who kicked off the session with an exploration of human emotion and its impact on brands, retailers and in-store decision-making.

Adams advised retailer attendees to “personalize your message, leverage nostalgia and connect emotionally.” Abby Prior, VP of business development for BrightFarms, a New York-based greenhouse grower, concurred. “We can make baby greens sexy. We show a beautiful greenhouse and explain how greenhouse growing sustains people and their families,” she said. “You need to tell a story that connects on an emotional level.” With this in mind, BrightFarms’ brand ambassador program is crucial to its marketing efforts. “How does it become more than just lettuce?” asked Prior. “How does it become an emotional connection?” When it comes to produce merchandising and advertising, neuromarketing plays an important role, asserted Adams, whose firm studies how consumers’ brains receive and react to marketing messages. Adams, who worked at PepsiCo and Frito-Lay earlier in her career, has led initiatives that brought about significant aisle reinvention and reinvestment of traditional marketing dollars into in-store displays. In recent years, she has seen

FrESh FolkS Participants in the 2016 Produce Power Session, held ahead of the PMA Fresh Summit, were (front row, from left) Guy Dille, Mettler Toledo North America; Jeff Fairfield, New Seasons Market; Glenn Daniels, Earthbound Farm; Abby Prior, BrightFarms; rick Seguin, ontario Greenhouse Vegetable Growers (oGVG); Brian huh, Dole Fresh Vegetables; Mimmo Franzone, longo Bros. Fruit Markets;(back row, from left) Eric Beelitz, Inserra Supermarkets; Jennifer Strailey, Progressive Grocer ; Jeff Cady, Tops Markets; Mike orf, hy-Vee Inc.; Michelle Adams, Marketing Brainology; Jonathan raduns, oGVG/Freshxperts; Samantha Barnes, Mettler Toledo; Jim Grabowski, Well-Pict Berries; Tom Williams, Coborn’s Inc.; Peter kirigiti, Mettler Toledo; oleen Smethurst, Costco Wholesale Canada; Wayne D. Brown, Calbee North America; and Meg Major, Progressive Grocer.

January 2017 | progressivegrocer.com |

Fresh Food

PG’s 2016 Produce Power Session

technology increasingly influence impactful merchandising. Adams pointed to the Minneapolis-St. Paul-based Lunds & Byerlys, which uses a changing digital screen over its berry display to capture customer attention and sell more product in the produce department. Digital signage is an opportunity to drive messaging, affirmed Guy Dille, retail BA leader and NA service business development for Mettler Toledo North America, in Columbus, Ohio. “Leverage those assets in the store, and as you see what’s happening in that department in a given week, you can adjust your messaging,” he noted.

If it’s something people can eat in the car, sales are growing. If they have to wash, peel or seed it before they eat it, it’s not going anywhere Forecasting Flavor for us.” Consumer demand for flavor is changing the fresh —Jeff Fairfield, new Seasons market

mInd rEadInG marketing Brainology’s michelle adams explains how the human brain receives marketing messages.

produce landscape, affirmed roundtable moderator Meg Major, PG’s chief content editor, who asked about the importance of flavor to customer loyalty and the bottom line. PG’s Produce Power Session participants unanimously agreed that taste is non-negotiable. “We had one of our best years yet by going after flavor,” asserted Tom Williams, director of produce and floral merchandising for St. Cloud, Minn.-based Coborn’s Inc. “In looking at the Millennial customers and what resonates with them, we know they like the convenience factor, but it has to have flavor.” With an eye on this coveted consumer and beyond, Coborn’s last year opened a next-generation store (see PG’s Store of the Month in this issue, starting on page 42) that emphasizes flavorful produce, bakery and deli. “It’s all about fresh and quality,” said Williams. The new store concept also features a Chop Shoppe — an area of the store devoted to the made-to-order prepping and packaging of produce for customers — which, he observed, artfully “combines flavor and nostalgia.” “Flavor is hugely important for our member

| Progressive Grocer | Ahead of What’s Next | January 2017

base,” agreed Oleen Smethurst, assistant VP/ GMM buying and operations/produce for Ottawa, Ontario-based Costco Wholesale Canada. She sees the demand for tastier produce driving hothouse and tomatoes on the vine, as well as new, more flavor-packed apple varieties. Demand for more flavorful produce is also driving sales in specialty, local and organic produce. “It’s an exciting time,” enthused Mike Orf, assistant VP of produce operations for West Des Moines, Iowa-based Hy-Vee Inc., who pointed to a shift in demand for more specialty items in potatoes and categories across the board. Today’s “flavorseeking shoppers are never going back,” he added.

Ease and Innovation Flavor may be foremost, but consumer desire for new experiences, in tandem with convenience, is fueling innovation in the produce industry. “People want to try new things,” asserted Smethurst. Costco Canada’s membership-based club stores continually seek to innovate. “We’re looking to differentiate, and we know if something is going to work [in our stores] within two weeks.” Product presentation also plays a critical role here. In a warehouse setting, noted Smethurst, packaging and color are even more important to attract shopper attention. “We try to make it an adventure every time shoppers come in,” said Eric Beelitz, director of produce for Mahwah, N.J.-based Inserra Supermarkets. Bountiful and ever-changing displays, along with convenience-focused, on-trend produce items are a recipe for success at this family-owned chain with 22 ShopRite stores in New Jersey and New York. Under Beelitz’s direction and that of its leadership team, Inserra is turning produce into one of its signature departments. Consumer demand for convenience has driven innovation and reduced shrink at Inserra. “The convenience pipeline — using cut fruit and cut veg in the meat department — is really helping us with shrink,” he noted. “It is labor-intensive, but it’s very profitable.” Convenience is equally important at Tops Markets. “Anything that can save the customer work is selling,” said Jeff Cady, director of produce/floral for Williamsville, N.Y.-based Tops. “Cut fruit continues to grow at double digits.” “Bulk veg sets keep getting smaller, and value-added and kits keep getting bigger,” concurred Jeff Fairfield, director of produce for New Seasons Market, a 17-store chain based in Portland, Ore. “If it’s something people can eat in the car, sales are growing. If they have to wash, peel or seed it before they

Retailer and Supplier 2017 Wish Lists

eat it, it’s not going anywhere for us.” Convenient bagged salads, which took the produce business by storm some years ago, are now a mainstay in supermarkets across America. But some industry experts believe that dialing in the right mix and set space will be the key to further growth. “We want the consumer to spend seven seconds on their salad selection. In the U.S., it’s five seconds, but if they spend 15, they’re confused and we’ve lost them,” explained Brian Huh, VP of category development and customer strategy for Dole Fresh Vegetables, in Monterey, Calif. While sales of bagged salads once soared, Huh noted that sales are now flat. “The data is suggesting [the category] is waiting for innovation,” he said. “One of the biggest challenges in this is certainly that retailers have maintained the same amount of space and want sales to increase. We need to increase space in the salad category in order to increase sales.” The industry has witnessed the growth in bagged salads shift to chopped kits. “They’ve directed most of the growth in the category this year,” noted Glenn Daniels, VP of customer development in the eastern region for Earthbound Farm, in San Juan Bautista, Calif. “Flavor and convenience are why we’re seeing these chopped salads fly off the shelves.”

Why Not Try? “The biggest pressure for produce today is that it’s the new battleground for price,” asserted Hy-Vee’s Orf. “The Toronto market is particularly competitive on price,” agreed Mimmo Franzone, director of produce and floral for Vaughan, Ontario-based Longo Bros. Fruit Markets. To blunt the price war barrage, Longo’s has successfully increased its touchpoints with customers, including its Why Not Try? campaign to entice shoppers to eat a new fruit or vegetable in its biweekly circular. “We put our own knowledgeable people on the demos,” explained Franzone, which include samples, a discussion of the origin of the produce, its taste profile and serving suggestions. “It has dramatically increased sales,” he affirmed. A similar effort has yielded increased produce sales at Coborn’s. Williams shared that in-store demos, ramped-up staff training and a focus on customer engagement increased sales significantly in eight Coborn’s stores in just five months. “You don’t have to be the cheapest; you have to have great service and quality,” agreed Fairfield. With that in mind, New Seasons employs produce promotional managers to create taste experiences for shoppers. Connecting In-store and Online When asked about the best means of staying ahead of the competitive curve, retailer participants indicated that both in-store and online efforts have become a powerful combination in

Gathering produce executives from both the retail and supply side of the business gave Progressive Grocer the opportunity to ask both parties their wish lists for greater collaboration in 2017. “Regular communication is the simple answer,” said Rick Seguin, general manager of the Leamington-based Ontario Greenhouse Vegetable Growers (OGVG). Seguin joined the OGVG several years ago, after a 32-year career with Agriculture and AgriFood Canada (AAFC) and other federal government departments. “Come to me with a solution, not a problem,” urged Jeff Cady, of Williamsville, N.Y.-based Tops Markets. “Have a business plan and share your instincts with me. We’re partners in this business.” “Let us help you manage the category,” said Brian Huh, of Monterey, Calif.-based Dole Fresh Vegetables. “Let us help you increase sales.”

educating and delighting shoppers. “How do you merchandise the department to get that ‘wow’ effect? Build massive displays of seasonal items and stay on top of all trends,” asserted Beelitz. “But to really increase consumption, you have to have a knowledgeable produce team,” which is why he conducts 15-minute weekly conference calls with his produce staff to set expectations, recognize strong team performers, discuss merchandising plans and goals, and review which categories are performing well and why. “Knowledge is power,” noted Beelitz. “It comes down to what you do in store,” Orf said. “You have to offer a different experience than other folks. You need to consider how the bakery and deli tie into produce with cheese and bread. Celebrate produce and get behind certain items.” At Coborn’s, dynamic in-store events supported by electronic communication are making an impact and increasing sales. The grocer has cultivated a relationship with a merchandiser that creates enticing recipes featuring fresh produce from Coborn’s. The merchandiser now has an online following among Coborn’s shoppers. “We’re taking creativity to a whole new level in-store,” said Williams. On the supplier side, companies are expanding social media and education efforts. “I’ve been in the industry for 30 years, and I have never been on a roller coaster like this,” admitted Wayne D. Brown, VP of sales for Fairfield, Calif.-based Calbee North America, maker of the plant-based Harvest Snaps snack line. Brown marveled at the growth in produce-based snacks, such as Harvest Snaps, which engages in sampling and social media campaigns, and recently implemented a loyalty card. “We’re trying to educate retailers so they can in turn educate consumers,” noted Jim Grabowski, director of marketing for Well-Pict Berries, in Watsonville, Calif. “We engage with recipes and social media, and we work with bloggers. Our goal is to get berries into the stores and let them speak for themselves.” PG

We try to make it an adventure every time shoppers come in.” —Eric Beelitz, Inserra Supermarkets

For Produce Power Session participants’ thoughts on health and wellness, visit progressivegrocer.com/producepower.

January 2017 | progressivegrocer.com |

In-store Solutions

Technology

Is In-store Digital

Ready for Prime Time? Consumer-facing tech garners mixed reviews. By John Karolefski

he supermarket setting is gradually becoming more digitized, with beacons, video screens, and at-shelf electronic pricing. Although deployment of consumer-facing technology is generally considered modest in grocery stores across the country, there’s enough of a track record to study its early performance. What’s the report card? Rajeev Sharma, president of VideoMining Corp., a State College, Pa.-based provider of instore behavior analytics, believes that many of the digital technologies deployed in supermarkets are still in their early phases, so the net impact on the shopping experience is minimal. So far, however, in-store digital signage has been used effectively by several retailers to improve the shopper experience, while at-shelf signage and electronic pricing are undergoing pilot testing by many retailers, with some

TagS, They’re iT interactive shelf tags, like these at Kroger’s Cold Spring, Ky., store, are emerging as a key component of the instore digital experience.

positive initial results, Sharma adds. Evaluating effectiveness is challenging because the purpose of such technologies is often unclear, according to David Shukri, “retail champion” at Mindtree, a Warren, N.J.-based IT services and consulting firm. “Do they help to increase basket spend or support loyalty and retention?” he asks. “We have to be careful as market observers and technology vendors not to overplay the ‘wow’ factor at a time when an increasKroger’s intent ingly tech-native population will view something is to provide either as business as usual or unnecessary noise.”

the best digital

Shining Beacons experience.” For his part, Barry Stone, director of marketing at New York-based Digital Social Retail, is more enthu- —Brett Bonner, Kroger siastic about emerging technologies in grocery stores. “The latest digital technologies, such as beacons and digital signage screens, have enhanced the conContinued on page 100

January 2017 | progressivegrocer.com |

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Solving Handheld Device Management #TrueStories In today’s complex, customer-driven retail environment, grocery DCs and warehouses rely on high-cost devices like handheld scanners, tablets and mobile computers to keep employees as efficient and productive as possible. They spend hundreds of thousands of dollars on the latest devices, and thousands more on maintenance and repair. But when it comes to controlling those devices, they often rely on manual, high-maintenance systems. At Apex, we hear some crazy-but-true stories. Like managers who spend hours every day handing out scanners one by one, then collecting them again later. Or DCs that pay someone overtime to round up electronics before and after every shift. We’ve heard stories about finding mobile devices left on shelves or accidentally shipped out with orders. We’ve even heard of lost scanners turning up in online auctions.

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The High Cost of Handheld Device #TrueStories

These solutions offer 24/7 control of handheld devices and quick, self-serve check-out and check-in. The Trajectory Cloud™ platform provides a detailed view of who checkedout each device and when it’s due back, and sends alerts if devices aren’t returned on time.

Lack of control and accountability when managing handheld devices can have an enormous impact on a DC’s productivity – and profitability. • Missing scanners can lead to hundreds of hours of lost productivity each week. • DCs typically replace 15-20% of handhelds annually due to loss, damage and misuse. • Lack of accountability results in sky-high repair and replacement costs. • Managers lose valuable hours handing out scanners, tracking down lost devices, and ensuring scanners are charged for the next shift.

AXCESS™ Automated Locker Systems provide self-serve check-out and check-in, with 24/7 control and visibility.

With so many DCs using automation to optimize their operations, it’s not surprising that many have selected AXCESSTM Automated Locker Solutions to help them respond to increasing demand.

How AXCESS Solutions Eliminate #TrueStory Headaches Greater Accountability Every device is tracked to its user,so damage, theft and loss are virtually eliminated. Greater Productivity AXCESS lockers are self-serve, so employees don’t have to wait in line and managers can focus on more value-added tasks. Significant Savings Your mobile devices are protected and last longer. You’ll always know who has every device, and its condition when checked-out, so fewer spares are needed. See them at NRF’s BIG Show, Booth #853 To get control of your handheld devices, see Apex at Booth #853 at NRF’s BIG Show or visit ApexSupplyChain.com/ AssetManagement. © 2016 Apex Supply Chain Technologies LLC. All rights reserved. Apex Supply Chain Technologies and its mark are registered trademarks, and Trajectory Cloud and AXCESS are trademarks of Apex Industrial Technologies LLC.

technology In-store Solutions

Continued from page 97

WeiGHinG oPtions Kroger’s scan, Bag, Go system allows shoppers to input their product prices, including produce.

As the hesitation around proximity marketing erodes further and infrastructure evolves, the capabilities become limitless.” —Mike Puffer, HelloWorld

sumer’s grocery shopping experience by making it easier for customers to be notified of special promotional coupons, and provide an easy way for consumers to navigate grocery stores for specific items,” he says. “These tailored technological interactions with the customers result in increasing customer loyalty. The best customer to have is one who keeps coming back.” To illustrate his opinion, Stone points to an excerpt from an article in Forbes magazine that discusses the rising trend of beacon technology: “Beacons — sensors that are embedded throughout a retail store’s digital touchpoints like shelves, signs and product displays, and can interact with mobile devices using low-energy Bluetooth signals — will continue to gain momentum in the next 12 months.” Indeed, while beacon technology has yet to be widely deployed in grocery stores, surveys show that about a third of consumers are receptive to receiving in-store notifications from beacons, with the highest concentration among 25- to 30-year-olds, notes Mike Puffer, who leads product strategy at Detroit-based HelloWorld, a digital marketing solutions company. “Kroger, Walmart, Whole Foods and Target are among the top grocers and retailers to watch,” he asserts. “They have made a significant investment of time, energy and capital into their digital innovation.” For example, Kroger’s 55,000-square-foot supermarket in Cold Spring, Ky., 10 miles southeast of its hometown of Cincinnati and a December 2015 PG Store of the Month, serves as a testing lab for the latest in-store technologies, enabling the country’s largest traditional grocer to set the standard for how shopper engagement will be conducted in the future. “We are interested in creating a better shopping experience,” asserts Brett Bonner, the retailer’s VP of research and development. To achieve that goal, Kroger has put together a digital ecosystem that blends shopper-facing hardware with sophisticated technology behind the scenes. Here are two of the most promising applications:

Shelf Edge: The center store is outfitted with “smart shelves” in the form of small rectangular tags that display digital prices and ads. There are some 2,000 Edge tags that replace paper tags, eliminating the need for store associates to change them periodi-

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cally by hand. In the future, the tags may be able to provide nutritional information and motion video, as well as communicate with a shopper’s smartphone.

Scan, Bag, Go: At the entrance of the store, cus-

tomers are greeted by a Scan, Bag, Go kiosk loaded with hand-held scanners to use while shopping. They can scan and bag products, including fruits and vegetables in the produce department. When finished, they scan a special barcode on a terminal at the front of the store that transfers their order to the checkout. “We’re still in the test-and-learn phase,” notes Bonner. “There’s a lot we learned in this store, and we are still learning. Kroger’s intent is to provide the best digital experience.” Meanwhile, Dollar General, in partnership with Coca-Cola and HelloWorld, has deployed beacons in 13,000 store locations to provide a unique experience and deliver value for both the shopper and the retailer. Shoppers who download the store’s app and opt into the program receive messaging and/or coupon offers triggered by the shoppers’ proximity to in-store beacons. The messaging encourages Coca-Cola purchases when shoppers are in certain locations, such as near a Coke beverage display, and aims to increase basket size. Not only has this solution been rolled out nationally, but Goodlettsville, Tenn.-based Dollar General continues to evolve and refine it. Several promotional strategies and individual marketing content tied to the initiative have been advanced throughout the year, tying into key shopping periods such as holidays. “As the hesitation around proximity marketing erodes further and infrastructure evolves, the capabilities become limitless,” explains HelloWorld’s Puffer. “Consider a retailer’s ability to shift traffic from the perimeter and drive center store sales by directing users to the shelves and sections of the store to find the items on their wish lists. Think

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Technology In-store Solutions

sTRiP MininG Ways to get shoppers out of the store more quickly include paying for groceries from a hand-held device.

about the ability to highlight a product at shelf when a user has identified it as an item on their list, when the consumer nears that shelf location. These experiences are being experimented with today.” According to Digital Social Retail’s Stone, beacons enable retailers to do the following: Track the location of customers as they enter the store, browse and complete their shopping See what aisles customers are spending the most time in while in the store Understand how many customers open the push notifications, redeem coupons or sign up for loyalty reward programs

Retailers should first ask the question, ‘Does this technology make shopping easier for my customers, or is this technology for technology’s sake?’” —Mark Heckman, Consultant

Conduct customer surveys to instantly obtain valuable customer feedback and data on their shopping experience

Moving Forward Obviously, there are plenty of grocery stores without any of these new in-store technologies. What’s the thinking of these retailers? Why don’t they invest? “Many grocery stores may not be employing this type of technology yet due to a lack of understanding of how beacons or digital signage can increase store revenue and foot traffic,” Stone suggests. “Pushing coupons directly to a consumer’s mobile device can increase impulse buys by 19 percent, says Nielsen Media Research.” Consultant Mark Heckman believes that retailer reluctance can be traced to the nature of the technology. For example, non-customer-facing technology that works behind the scenes to reduce out-of-stocks,

Future in the Physical Investing in cutting-edge in-store technology can be intimidating for grocers, especially when many are focusing more on e-commerce expansion as part of an omnichannel survival strategy. It should never be overlooked, however. Although digital retail is capturing headlines, physical stores remain critical, according to “On Solid Ground: Brickand-Mortar Is the Foundation of Omnichannel Retailing,” a July 2014 report from Chicago-based consultancy A.T. Kearney. Some 90 percent of all retail sales are transacted in stores, and 95 percent of them are captured by retailers with a brick-and-mortar presence. “Stores provide consumers with a sensory experience

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shorten checkout lines, and better manage merchandising and inventory isn’t optional for long-term success. Retailers must invest in these to compete. “But customer-facing technology such as instore touchscreens and the emerging locational targeting technology of beacons and WiFi are another story,” he’s quick to add. “Retailers should first ask the question, ‘Does this technology make shopping easier for my customers, or is this technology for technology’s sake?’” VideoMining’s Sharma surmises that some retailers are naturally cautious about investing in technologies that are as yet unproven. That could be a mistake, however. “I do think they should invest in new in-store technologies, because it would be a huge competitive disadvantage to be a slow adapter,” he cautions, “especially as the younger generation of shoppers come into their stores expecting access to some of the new technologies and applications that they see and use in other stores and channels. “Grocery stores are now beginning to feel the impact of competition from online retailers,” continues Sharma. “In-store digital technologies provide new ways to begin to counter those challenges, along with good omnichannel strategies.” PG

that allows them to touch and feel products, immerse in brand experiences, and engage with sales associates who provide tips and reaffirm shopper enthusiasm for their new purchases,” A.T. Kearney says. Additionally, two-thirds of consumers who purchase online use the store before or after their transactions. In these cases, the store makes a significant contribution to converting the sale, even though the transaction eventually is registered online. “The debate should not be a question of digital or physical,” A.T. Kearney notes. “Successful retailers understand how each customer touchpoint adds value … and develop omnichannel strategies — with stores as the foundation — that maximize customer satisfaction with profitability.” —Randy Hofbauer

| Progressive Grocer | Ahead of What’s Next | January 2017

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Foodservice Equipment

Equipment & Design

Keeping Pace

s supermarket foodservice “one of the secrets to our great food is making Retailers and continues to play an increasthings in continuous small batches. Having manufacturers ingly important role, an array enough chiller capacity gives us the ability to are both of new products is being cook, chill and sell great food closest to the time adding to their marketed and adopted at of production, not days later.” retail to keep pace with this growth. Gridley adds that Dorothy Lane’s most foodservice At K-VA-T Food Stores Inc., in Abingdon, versatile piece of foodservice equipment is the equipment Va., Director of Bakery Deli Operations David Ruhl turbo dicer, which provides the ability lineups. Haaf notes that his company has added fresh to slice or dice large quantities of meat or vegfood bars — including soup, salad, wings, etables in a uniform size at a high rate of speed. By Bob Ingram salsa, fruit, tacos, and antipasti and olives — Major remodels have just wrapped up in to create a fresh food destination, along with two of the company’s three stores’ kitchens, he pizzeria makeup units, among them brickobserves, with more refrigeration to be added to oven pizza ovens in limited locations, to help create a fresh one and dishwashers to be replaced in both with new energyimage, as well as theater for shoppers. The grocer has added efficient ventless prep washers. cook shack smokers, too, to provide ready-to-eat fare, as Among suppliers, Cheryl Beach, marketing communicawell as special-order selections. tions manager at Hussmann Corp., in Bridgeton, Mo., says According to Haaf, K-VA-T, which operates stores under her company’s latest foodservice equipment addition is a threethe Food City banner, already has seven pieces of foodservice zone high-volume vertical glass over/under merchandiser, equipment in the front of the house and 11 in the back of the with an interior cube design that allows for interchangeable house, and has just added artisan cheese shops in a few locamerchandising solutions for bulk, fresh and packaged product. tions, with accompanying refrigeration and food processors. “The all-glass front and top, hinged French front doors, At the legendary Dorothy Lane Market, in Dayton, Ohio, and adjustable, multidirectional LED canopy light draw Jack Gridley, VP of meat, seafood, deli and prepared foods, the shoppers’ attention to the product display,” she notes. says that the company has added another blast chiller because “[It] is all about merchandising to enhance the shopping January 2017 | progressivegrocer.com |

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Equipment & Design

Having enough chiller capacity gives us the ability to cook, chill and sell great food closest to the time of production, not days later.” —Jack Gridley, Dorothy Lane Market

nO HanDs Restaurant Technologies’ Total Oil Management (TOM) system eliminates the need for associates to handle cooking oil.

Foodservice Equipment

experience and encourage the shopper’s purchasing decisions.” Beach adds that retailer feedback has been “very positive” because the vertical front glass really pushes the product forward and closer to the shopper.

In the Balance Glenview, Ill.-based ITT Food Equipment Group launched its HT family of service scales “because the trend in the service scale industry was moving from digital scales to PCbased scales,” explains Todd Hagopian, global marketing director of ITT’s weigh wrap division. Hagopian says the service scale has really become a mini-computer, with the ability to control pricing, promotions and shrink, along with increasing revenue through merchandising, and decreasing costs through tare savings. The HT family has three models, with many variations that allow the customer to find the right scale, based on which features are needed in each department. “Most of these products are operating at just 40 percent of capacity,” observes Hagopian, “which means we have built the scale to grow as we add new software features and enhancements.” The scale has been “extraordinarily well received,” he asserts. “We actually sold more HT scales in 2016 than we sold in the first two-plus years after the launch.” On the Menu With growing demand for product information and increased regulations over what details retailers need to share about their food, digital signage is catching on among operators looking for a more

QuICk CHanGE Tebo’s Digital Menu Board works with any web-enabled device.

flexible way to deliver these messages. “We have catered our business to the needs of independent grocers by developing a new digital menu board system that is specifically designed to drive sales while keeping price in mind,” says Joe Michaels, VP of new product development at Denver-based Tebo Store Fixtures. Michaels points out that the system is easy to use, engages customers and can make “on-the-fly” changes from any web-enabled device. Also, Tebo has partnered with LG to bring the ultra-stretch screen to cutting-edge grocery display. Of the 86-inch-wide screen, Michaels notes that “we add this to our artillery because the screen itself is a work of structural art that is digital décor.” While there aren’t any metrics yet for the new menu board, Michaels says the current Tebo digital menu board has led to “proven increases in sales from 8 percent to 22 percent.”

Oil Change At Restaurant Technologies, in Mendota Heights, Minn., Jim English, director of national accounts, notes that more than 2,000 grocery delis use his company’s cooking-oil management system, which features automated oil storage, handling, filtration monitoring and disposal management. English says the system, known as Total Oil Management (TOM), eliminates the need for an employee to handle cooking oil. He notes that it’s currently used by such retailers as Wegmans, Tops Markets, Winn-Dixie, Hy-Vee, Lunds & Byerlys, Stater Bros., Raley’s, and Albertsons. TOM eliminates the transportation of hot

waste oil through the store and any potential back strain and slip-and-fall injuries from lifting and dumping heavy buckets, English says. “We know that maintaining a clean and presentable environment behind the deli counter is critical to grocery foodservice operators,” English adds. “Restaurant Technologies aims to help deli operations function as efficiently and safely as any commercial restaurant kitchen, in order to keep up with prepared food demands to offer quality fried foods, while maintaining a transparent back of house.”

The Grocerant Experience With supermarket prepared foods on the rise, suppliers that historically cater to the needs of foodservice operators are increasingly adapting their products for grocery applications. Among them is Structural Concepts, Muskegon, Mich., whose specialty merchandisers are designed “to create the grocerant experience, which we define as a grocery store that offers a restaurant-quality experience for dine-in or take-home meals,” says SVP Jeff Schneider. The company’s understated design puts the spotlight on food and high performance, Schneider explains, and temperature integrity ensures a grocer’s reputation for the freshest and most flavorful foods. Customization, he adds, gives a unique appearance. Schneider notes two recent innovations: first, the Grocerant Series of modular front-line food bars, which allows mixing and matching to support specific menus. “You can create your own custom yet cost-effective food lines,” he observes, “and the Grocerant Series is designed to integrate seamlessly with all of our other merchandisers.” The second innovation he mentions is the platform that all of the merchandisers are built on, known as alignext. With alignext, “the deli and prepared foods departments no longer look hodgepodge or disjointed,” Schneider says. “Every merchandiser, including food bars, is designed to seamlessly flow using a minimalist design that eliminates unnecessary end panels, mismatched case profiles, gaps and extra hardware. The result is departments where the eye is immediately drawn to the

food, not the equipment.” Whole Foods Market has been a big supporter of both the Grocerant Series and the alignext platform, he notes, and “we are helping many other retailers to build their grocerants.” The growth of retail foodservice continues, as does the equipment to support it. Stay tuned — there’s doubtless much more to come. PG

The World Standard For Destratification

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Supply Chain

Workforce Management

Right on Time

Retailers can increase service levels and grow sales by using workforce management technology. By Jenny McTaggart

S Our workforce management solution has allowed our schedules to be more customerand associatefocused than we could ever have managed with paper.” —Jeremy Stevens, Hannaford

ticky-note scheduling is now a thing of the past at Scarborough, Maine-based Hannaford Bros. Co., a regional grocery banner belonging to the recently merged retail conglomerate Ahold Delhaize. Over the past decade, Hannaford has revolutionized its workforce management procedures, thanks in large part to technology from Kronos Inc., based in Chelmsford, Mass. Not only has scheduling become easier, but customer service has benefited, too, according to Jeremy Stevens, Hannaford’s manager of labor productivity. “This workforce management solution has enabled us to use more information and make more informed schedules than ever before, and the ‘associates at the right time’ capability has enabled us to increase our service levels to customers and grow our sales,” he tells Progressive Grocer. In this post-recession economy, more grocers are likely to follow in Hannaford’s footsteps and increasingly rely on workforce management systems as they earnestly seek competitive differentiation through better customer service and improved employee engagement.

A Study in Scheduling Hannaford, which today operates 179 stores in the Northeast, first used Kronos’ scheduling solution, Workforce Scheduler, back in 2004. At that time, the grocer was interested in improving the customer service experience in its front end and deli departments, so it decided to invest in optimized scheduling. “At our deli counter, it was critical that we had the right associates available to assist customers,” explains Stevens. “Kronos’ solution helped us think

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about customer-facing service counter associates and production associates separately. In addition, we were able to take advantage of department-specific customer traffic patterns and the ability to define when certain fixed activities occur, to ensure that we had the associates we needed to meet all the demands in this department.” Pleased with the initial results, Hannaford deployed the solution to all of the departments in its stores over the next several years. One of the greatest differences that the scheduling solution has made at Hannaford is improved accuracy, says Stevens. “Our workforce management solution has allowed our schedules to be more customer- and associate-focused than we could ever have managed with paper,” he notes. “We use dozens of data streams to feed volume and traffic information into Kronos. This allows us to consider more inputs more accurately than we ever could have reasonably managed on paper. Using the forecasting engine, we can easily schedule registers day by day and hour by hour, always considering the right mix of customers and items.” So, for instance, the retailer can schedule associates in its deli, seafood and meat departments specifically based on service counter traffic. In addition,

Avoiding Implementation Pitfalls its merchandising teams are able to plan activities around the times when traffic will be heaviest. On the associate side, Hannaford can now manage any number of associate preferences and requests, adds Stevens. “The scheduling tool enables us to easily manage associate availability and time-off requests. When we scheduled on paper, this was typically managed with a pile of sticky notes — which was not the most reliable method. Now associates can check their schedules from home or from a mobile device without the need to call the store and wait for someone to walk to the back room to check the schedule.” The grocer is currently piloting schedule generation that would give employees an extra week in advance to know their schedules, he says. According to Charlie DeWitt, VP of business development at Kronos, these employee-friendly methods are rapidly gaining ground in the retail industry, particularly as a new generation of Millennials seeks more flexibility in the workplace. “We’re seeing much broader adaption of mobile technology,” he asserts. “Retailers are realizing that their employees want to be able to check their schedules and swap shifts, or even check their paystubs, from home or on the go.” In fact, the overall concept of employee engagement is generating a lot of buzz in retailing circles, notes DeWitt. “In the early 2000s, I think people invested in workforce management and scheduling because they wanted to control labor costs, and they were worried about compliance risk. But in the last four or five years, really since the recession, the question that I get over and over again is, ‘OK, we’re doing a great job in controlling our labor costs and handling compliance risk, but can you do anything on the customer satisfaction side and on the employee side?’ Because people are fundamental to everything the industry does. So if you have empowered, engaged workers, they’re going to drive same-store sales, conversion, average transaction value, and so forth.”

Staying in Compliance In addition to its employee-friendly features, another bonus to workforce management technology is that it helps retailers maintain records for employee compliance. Hannaford’s Stevens notes that by using Kronos’ Workforce Timekeeper, the company has been able to “easily evaluate associate hours over the look-back period defined in the Affordable Care Act and maintain compliance with this and other legislation.” He adds that the retailer recently completed the deployment of Kronos InTouch time clocks in all of its stores. “We will likely use the integration of timeclocks, time and attendance, and scheduling to assist with compliance schedule rules for minors,” he explains.

Charlie DeWitt, VP of business development at Chelmsford, Mass.based Kronos Inc., has seen his share of missteps as retailers implement workforce management solutions. Here are a few tips he offers to help make things go more smoothly, and ultimately help companies get their return on investment: To run a good forecast, you have to put forth some effort: “Algorithms are smart, but they’re not that smart; you have to maintain the forecast,” he notes. “So, for instance, if you have a snow day in February, you don’t want that data polluting your forecast for the next year. Or if you’re running a promotion and it’s not exactly the same day of the promotion last year, you want to make sure you account for that. Don’t forget that Easter is a floating holiday.” Focus on change management: “With an information technologydriven project, you have to make sure that that the end users — the store managers and employees — can use the system,” he advises. “Otherwise, it’s useless. It can’t be an afterthought. You have to involve those people upfront.” Start simply: In the past, DeWitt says he saw retailers fall into the trap of “false precision.” “Many years ago, retailers thought that the finer-grained your labor standards were, and the more precise you were, the better off you’d be,” he explains, “but then they started to realize that not every cashier will take the same amount of time to run a credit card transaction, and not every transaction is going to be the same between different stores and different cashiers.” Now DeWitt and his team advise retailers to start with straightforward labor standards, as well as straightforward scheduling and forecasting philosophies. “If you need to get more complex, you can always do that, but start simply and start to get value out of the solution. We’ll be there with you to guide you along the way.”

Hannaford is also in the process of deploying Kronos’ Workforce Analytics. This technology, which enables real-time visibility into store performance across the entire enterprise, will replace a home-grown legacy tool that Hannaford had been using for 25 years. “Workforce Analytics will make it much easier for our scheduling managers to access productivity information and respond to shifts in our business volume,” says Stevens. “All this information will finally be integrated with our scheduling tools and will make it much easier for managers to maintain service levels.” While Workforce Analytics is one the newest systems being used in the grocery industry, there are other labor solutions that could gain ground in the coming years, notes Kronos’ DeWitt. “Because Kronos is involved in a lot of different industries, we see technologies being adapted in other industries that eventually fall into retail,” he says. “For instance, with our field services technology, we’ve been working with companies that replace auto glass or do cable installation, or even home health where nurses go out to deliver care in people’s homes. We’ve already developed solutions for that, so if the grocery industry were to move more in the direction of home delivery, we could see that being a ready-made solution for them.” PG

Retailers are realizing that their employees want to be able to check their schedules and swap shifts, or even check their paystubs, from home or on the go.” —Charlie De Witt, Kronos

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Food, Beverage & Nonfood Products

Spiked Delight

Be a Supper Superman

Appealing to Americans who wish to rule the kitchen but lack the time to do so, Revolution Foods has entered the grocery aisle with Dinner Hero, a line of shelfstable “speed-scratch” meal solutions enabling consumers to prepare and serve hot chef-created dinners without sacrificing nutrition. Dinner Hero combines whole grains, custom spice blends and sauces with easy-to-follow recipes. It comes in Coconut Curry, Sesame Garlic, Smoky Tomato Sausage and Fiesta Taco varieties, with an SRP of $5.99 per 10.2-ounce box. http://revolutionfoods.com

Taking a cue from both the sparkling water craze and the various fruit-flavor mashups of its top players, Diageo has introduced Smirnoff Spiked Sparkling Seltzer to the malt beverage category. The line, a lighter alternative to traditional malt beverages, consists of three varieties, Orange Mango, Cranberry Lime and Watermelon, each at 4.5 percent alcohol by volume per 12-ounce can. All contain 90 calories per can and 1 gram of carbohydrates, with no sugar or artificial sweeteners. The SRP is $8.99 per 6-pack. www.smirnoff.com

These Spices Don’t Run

Many cereals flavored with cinnamon often end up bare, with the cinnamon flavoring washing away in milk soon after it’s poured. This, however, isn’t the case with the Kellogg Co.’s latest cereal innovation, Kellogg’s Cinnamon Frosted Flakes. To develop the new flavor, driven by demand from fans, the manufacturer created a truly “frosted” cinnamon flake: Rather than dust the flakes with cinnamon, it put the spice within the flakes’ coating. The cereal comes in two sizes: 13.6and 26.8-ounce boxes, with respective SRPs of $4.69 and $5.79 each. www.kelloggs.com

Dairy to be Different

For the consumer who wants to enjoy the benefits of yogurt but can’t handle dairy or soy, Good Karma Foods has introduced a line of Dairy Free Yogurts made with flaxmilk. The spoonable yogurts — available in Blueberry, Strawberry, Raspberry, Vanilla and Plain varieties — contain 5 to 6 grams of plant-based protein, 800 milligrams of omega-3s, and seven live and active cultures in every serving. Additionally, they’re free from all major allergens, including dairy, soy and tree nuts, and have an SRP of $1.69 to $1.99 per 6-ounce container. www.goodkarmafoods.com

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A Cluck Above the Rest

The attributes “healthful” and “convenienceminded” — two frequent terms in consumers’ vocabulary today — often are at odds, especially when it comes to frozen foods. Bringing them together, GNP Co. has rolled out Gold’n Plump chicken meatballs and sliced sausages made with 100 percent boneless, skinless chicken thigh meat. The frozen products can be prepared in as little as 20 minutes while containing less fat than pork and beef varieties, along with 20 grams of lean protein per serving. With an SRP of $6.99, each 18-ounce zip-top bag contains products made only with clean ingredients — no antibiotics at all — and carries the American Humane Certified farm program seal. Varieties include Homestyle and Pesto Italian meatballs, and Italian Cheese & Peppers and Hickory Smoked sliced sausages. www.goldnplump.com

Snack or Meal?

It’s well known that many today, especially Millennials, have ditched the traditional three-square-meals model of eating and are snacking throughout the day. Taking a cue from this, United Snacks of America has introduced Farmer’s Pantry’s Meal Snacks. Straddling the line between snacks and meals, the new products are inspired by such traditional American meal recipes as Herb Roasted Turkey with veggies, cranberries and stuffing; Flame Grilled Chicken with slow-roasted corn; and Garden Harvest Chicken with vegetables. Each crunchy shelf-stable snack is created with proprietary natural spices and a slow-cooking method for the meat, and then blended together with slowroasted, hearty and crunchy vegetables in a 2.5-ounce double-pouched bag, packed in an 8-pack case. The SRP is $5.99 per bag. www.farmerspantry.farm

A Smarter Vape

Among a crowded assortment of e-cigarettes and accessories, Blu has found a way to stand out by offering a better vaping experience. The Blu Max e-cigarette offers Responsive Draw technology, which allows the device to respond to the rate of a user’s inhalation. The technology produces a vapor amount based on draw intensity, with an indicator light on top illuminating to communicate draw strength. More lightweight than its sister products, Blu Max offers an ergonomic mouthpiece that lets users inhale precisely and effortlessly. It also has a proprietary connector for easy refill changes, and a liquid-level indicator that alerts when liquid is low. Available in five flavors with two prefilled refills, each pack has an SRP of $12.99. www.blucigs.com

Better for Baby

Understanding parents’ interest in seeing not only the foods they eat before buying them, but also those for their babies, Sprout Foods has launched the 20-SKU Sprout Organic Baby Food line in clear pouches. The 4-ounce pouches, with nonGMO food for tots ages 6 months and up, include such varieties as Carrot Apple Mango, Strawberry Pear Banana, Blueberry Banana Oatmeal, Apple Oatmeal Raisin, Apple Banana Butternut Squash, Mango Oatmeal Butternut Squash, Pear Kiwi Peas Spinach and Apple Blueberry. The 4-ounce pouches have an SRP of $1.69 each. www.sproutorganicfoods.com

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Albertsons Picks ReposiTrak Food Safety Management Solution Boise, Idaho-based grocery retailer Albertsons Cos. has selected ReposiTrak Inc. to manage regulatory and business documentation compliance within its supply chain. “The health and safety of our customers is of the highest priority,” says Jim Seiple, Albertsons’ group VP of own brands product development. “We were looking for a solution that would enable us to scale and automate the management of our required vendor documents, and provide us with 24/7 visibility to compliance.” Randall K. Fields, chairman and CEO of Salt Lake City-based Park City Group, noted that Albertsons’ “commitment to food safety and transparency for their customers makes us proud to have them utilize our solution.” Albertsons operates more than 2,300 stores and related facilities under 19 banners across 35 states. ReposiTrak, a wholly owned subsidiary of Park City Group, helps manage regulatory, financial and brand risk associated with issues of safety in the global food, pharma and dietary supply chains. www.repositrak.com; www.parkcitygroup.com

Nature’s Path Acquires Majority Stake in Gorilly Goods Richmond, British Columbia-based Nature’s Path has acquired a 51 percent stake in Gorilly Goods, a raw on-the-go snack with a range of savory to sweet organic and non-GMO nut, fruit, seed and greens combinations. This venture by Nature’s Path represents the company’s growth beyond new product innovation and development, and adds to a list of previous acquisitions, including Que Pasa organic and nonGMO tortilla chips and salsa in 2012, and Country Choice Organics in 2015. Although terms of the deal weren’t disclosed, Nature’s Path’s involvement will provide the needed capital for Gorilly Goods to increase its manufacturing and leverage Nature’s Path’s retail network to expand distribution throughout North America and markets around the world. Based in Jackson, Wis., where its headquarters will remain, Gorilly Goods’ facilities are powered 100 percent by renewable energy, and the company donates 2 percent of its profits to the Dian Fossey Gorilla Fund. www.naturespath.com; www.gorillygoods.com

Sargento CFO George Hoff Retires George Hoff, EVP and CFO of Plymouth, Wis.-based Sargento Foods Inc., retired at the end of 2016. Jeremy Behler was promoted to succeed Hoff as CFO, effective immediately. Hoff joined Sargento as controller in 1983, after serving as audit manager at PricewaterhouseCoopers. He has held various financial roles at Sargento, most recently that of CFO, and was president of the consumer products division from 1997 to 2000. During his tenure, Hoff developed Sargento’s finance, accounting and information technology capabilities, which the company deems instrumental to its success. Until his retirement, Hoff served as EVP and adviser to CEO Louie Gentine, who notes: “George has built a solid foundation at Sargento, and his contributions will ensure future success for generations to come. I’m confident that Jeremy’s experience, knowledge and commitment to continuous improvement will build upon that foundation.” Behler, who came to Sargento from Procter & Gamble in 2014, will lead the finance, accounting and IT departments at Sargento. www.sargento.com

Applegate Farms Hires New VP of Marketing Applegate Farms LLC, the Bridgewater, N.J.-based natural and organic subsidiary of Hormel Foods Corp., has chosen Nicole Glenn as its VP of marketing. “Nicole will play a key role in leading us as we continue to build an innovative and integrated brand marketing strategy for the Applegate portfolio, ensuring that we bring to life our mission of ‘changing the meat we eat,’” says Applegate President Steve Lykken. Glenn previously was a marketing director for WhiteWave Foods, where she was most recently responsible for leading the Earthbound Farm organic produce business. She also has held roles at Constellation Brands, Terlato Wines International, and Procter & Gamble. www.applegate.com; www.hormelfoods.com

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Index Adusa Inc. Airius American Meat Institute Anheuser-Busch Inc Apex Supply Chain Technologies Avocados From Mexico Better4U Foods Blount Fine Foods Blu Cigs Cambro Manufacturing Company Campbell Soup Company Cargill Meat Solutions Celsius, Inc. Chobani Coca Cola NA D’Artagnan Del Sol Food Company, Inc. Domino Foods E&J Gallo General Mills Inc. GenerationNext Giorgio Foods, Inc. Godshalls Quality Meats Inc. Java Master Heineken USA Inc. House Foods America Iovate Health Sciences Int’l Inc. Jack Link’s Beef Jerky Johnson Ventures Lagunitas Brewing Co. MarketTrack MasonWays Indestructible Plastics Mettler Toledo Mondelez International National Confectioners Assn National Restaurant Association NatureSweet NBTY New Hope Network Niman Ranch Pharmavite LLC Robbie Flexibles Stout Beverages, LLC Sun Pacific Tebo Store Fixtures The J.M. Smucker Company The Wonderful Company/Pistachios Tosca Ltd. Trion Industries Inc. Tyson Foods Windsor Foods/Discovery Foods

101 107 80 Inside Back 96, 98-99 Insert 67 68 15, 33 51 104 7 40 65 Cover Tip 59 87 69 13 30 34-35 18-19 81 83 49 61 71 67 37 39 77 56-57 50 103 17, 25 55 62 79 Back Cover 91 85 21 86 74-75 92 45 28 23 52 9 4, 10-11, 26-27 Inside Front Cover-3

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The Last By Meg Major

Beyond the e-Commerce Echo Chamber

“Y

The e-grocery foot race is much ado about nothing, and the U.S. food retailing world has gone full-on mad in its ‘followthe-herd mentality.’

es, Virginia, online grocery is failing.” Said no one. Ever. With one exception, that is: Kurt Jetta. To be sure, Jetta’s made quite a name for himself as the rabble-rousing contrarian of discourse regarding the ascension of online grocery, which is growing upwards of 15 percent annually, and poised to top an estimated $12 billion in sales at the close of 2016 (final tally not available at press time). Long story short: Jetta deems the e-grocery foot race much ado about nothing, and that the U.S. food retailing world has gone full-on mad in its “follow-the-herd mentality” to enter the online grocery derby solely because their competitors are doing so. As such, Jetta feels many e-grocery adopters are “shooting themselves in the foot” by investing heavily in a space where they make less money while concurrently undermining their fundamental advantages and core operational strengths to goose transitory online sales. Not surprisingly, Jetta has taken heat for his stance regarding e-grocery, which, he believes, is neither enjoyable nor intuitive, is more expensive and vastly more impersonal — not to mention his biggest beef, which is a fundamental lack of demand, because the majority of folks are generally happy with their existing grocery store experiences. His views have been characterized as “absurd,” and even sparked the ire of our website partner/ contributor Phil Lempert, who opined in a recent segment of his videos, which air daily on our website, that he was “angered” by Jetta’s headline-generating proclamation “that online grocery is failing.” The TABS Analytics CEO is unfazed — yet also gets it. “So, what’s it like being the voice of one calling in the wilderness?” I asked Jetta during a recent phone chat. “It’s totally bizarre,” he readily admitted, with nary a shred of thin-skin regarding critics’ barbs. “It’s like facts don’t matter. Anybody on the opposite side of the [e-grocery] discussion never presents any concrete data” to

Meg Major

Chief Content Editor mmajor@ensembleiq.com Twitter @Meg_Major/@pgrocer

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verify or support their claims of the actual market penetration. “It’s always based on what they think it will be, or what they project it will be. But we are not seeing substantiated proof. I’ve read dozens of research studies,” Jetta continued, “but nobody ever talks about the consumer side in terms of real demand, and what it actually looks like.” Jetta defends his position based on findings of his firm’s fourth annual “Food and Beverage Study,” which found that less than 5 percent of consumers regularly buy food online, versus 78 percent who regularly purchase it from brick-and-mortar stores — an increase of a mere half a percentage point since TABS’ 2015 study. The survey panel for his latest independent study, conducted in August 2016, consisted of 1,000 geographically and demographically dispersed consumers age 18-75 and included 15 top consumables categories. Amazon, which netted a 2 percent increase in shopper penetration, from 14 percent in 2015 to 16 percent in 2016, was the sole online shopping venue to increase shopper penetration in 2016. During the past four years, Jetta notes, “Consumers have turned their backs on buying groceries online,” regardless of the volume of enticements offered. “Sixty-nine percent of consumers never buy groceries online,” he continued, with only 15 percent of users pledging allegiance. The reality of repeat business “is less than impressive,” he affirmed, especially when considering the industry loyalty rate benchmark of 70 percent. As such, grocers “need to figure out why there is such a high level of dissatisfaction with the online channel,” Jetta cautions, before funneling further investments into e-grocery assembly. “It’s not an inevitability that online grocery will fail,” says Jetta. But if nothing changes with the current dynamics — foremost being declining penetration and low repeat rates — “the demise of online grocery is a mathematical certainty,” he contends. “It’s not like we want online grocery to fail. But as it stands, there are no facts to suggest that a massive boom can be expected any time soon,” or ever, for that matter. He instead advocates investing in accurate, measurable data “to figure out why penetration and repeat business in the online grocery market are so low,” and what it takes to nail pay dirt in the space. “Exuberance and futurism are great — but it needs to be tempered by research and planning.” While Jetta’s views are bound to spark continued debate, there’s one thing both he and his detractors see eye to eye on: The entire industry is rightly transfixed on grocery e-commerce. And when pondering potential progression to be made in the e-grocery arena, it goes without saying: We ain’t seen nothin’ yet. PG

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