Richard J. George, Ph.D.

Grocers Ready to Fight Over Ukrop's Shoppers

May 10, 2010

FROM RETAILWIRE:
Ahold may have bought the Ukrop's grocery chain but there is no guarantee that the shoppers who were loyal shoppers at the local institution will be coming around to shop in the renamed Martin's Food Market locations. Do you expect Martin's to gain, maintain or lose shoppers from the levels previously registered under Ukrop's?      [more...]

I assume that Ahold did the necessary due diligence before changing the name of the iconic retailer, Ukrop's to Martin's Food Market. However, Ukrop's appears to have had a following of dedicated customers that now may be up for grabs to the rest of the competitors who are certainly ramping up their stores, prices, and customer experience.

The concept of a larger chain retailer purchasing a well-respected and run independent seems to make sense assuming that the independent's banner remains in place and the economies and efficiencies of the chain are applied to the acquired entity. Several years ago in Philadelphia, Safeway purchased a great brand, Genuardi's, left the name on the front of the store but "Safewayized" everything in the customer's experience. The results were disastrous.

A more recent acquisition by Ahold of another great Philadelphia independent, Clemens, followed the Ukrop's model, namely, the name was changed to Giant, however the stores retained much of the cache that existed when operated by the Clemens' family. It remains to be seen whether the Ahold approach will work.

However, as noted previously, why not leave the name as is, build on the years of consumer equity and bring greater efficiencies of scale to the operation?. Instead you run the risk of putting many of the former Ukrop's customers out of play. Why do this?