[Image of: RetailWire Logo and Tagline (for print)]
 
[13 comments]

Chefs spice up grocery store atmosphere

May 21, 2014

One thing missing from many (most) supermarkets is atmosphere. Aisle after aisle of bags, boxes, bottles, cans and cartons amount to a mind numbing experience for those consumers. Many critics of the modern shopping experience point to restaurants as a source for new thinking when it comes to creating in-store environments consumers crave. So what would a supermarket look like if an award-winning chef designed it? Standard Foods, opening in Raleigh, NC will start to answer that question next fall.

Chef Scott Crawford, an award-winning executive chef from the Umstead Hotel in Cary, NC, will open a small, 5,500-square-foot grocery store. It will be the only grocery store in downtown Raleigh when it opens.

"Fresh seafood, short ribs, fresh rabbit, quail, local eggs, local milk and the list goes on and on," Mr. Crawford told WNCT. The chef also plans to open a full-service restaurant next to store in 2015.

Mr. Crawford is not the first chef to get into the grocery business. Mario Batali is among a group of investors behind the Eataly Marketplace concept in New York and Chicago. According to its site, "Eataly wants to challenge the idea that quality products are accessible only to a select few. Good eating and shopping is not limited to connoisseurs; it is an agricultural act we all have the right, 'diritto' in Italian, to enjoy."

Supermarkets, most notably Wegmans, have also explored the connection between grocery stores and restaurants. The chain, which operates restaurants both inside and adjacent to its grocery stores, recently had grand reopenings of its "The Pub" restaurants in Malvern and Collegeville. Changes included updated menus, the addition of local craft brews and lower and more family-friendly tables with linen napkins instead of paper.

"We think customers will love what we've done to make these popular dining spots even more appealing," said Kathy Haines, Wegmans' director of in-store restaurants. "We've learned a lot since opening our first Pub about five years ago, and when customers have suggested changes that could improve the experience, we've listened."

Discussion Questions:

How big a problem is "atmosphere" in the modern grocery shopping experience? What can grocery stores learn from restaurants and vice versa?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How likely are we to see more chefs getting involved in grocery stores in the years to come?

Comments:

Clearly, most shoppers do not think of "atmosphere" or "ambiance" when they hear the term "grocery store." A grocery store or supermarket is generally one notch above a warehouse club when it comes to atmosphere and eye appeal. The idea of changing that is really intriguing, but for the majority of supermarkets, there is no chance of creating a fashion boutique or fine dining ambiance out of aisles of soup cans and toilet paper packages.

The Wegmans I've seen bear this out. The first few aisles are more upscale, occasionally with a chef sequestered in a little cooking nook and a place to sit and eat their prepared foods, but the farther one goes to the other side of the store, the more warehouse-like it gets. I can't imagine what it would cost to fit out the whole store that way, or add custom fixtures and displays, no matter what chain we're talking about.

In-store restaurants may draw some, but lots of families are not going to opt to bring the kids and both parents out at night to eat and grocery shop. So, I think that there's some room for smaller footprint stores, or one-off's to go down this road, but the industry isn't headed there.

[Image of: View Braintrust Panelist button]
Ken Lonyai, Digital Innovation Strategist, co-founder, ScreenPlay InterActive

Consumers want to have a great experience when they put down their laptops and drive to a location to shop. That goes for supermarkets as well as any other store. Wegmans and Whole Foods both have done a great job creating an inviting shopping experience and allowing shoppers to sit down and have a meal inside the store. They just need to know their audience and what will attract them to an in-store eatery.

[Image of: View Braintrust Panelist button]
Debbie Hauss, Editor-in-Chief, Retail TouchPoints

I just had to go to my local King Soopers (a Kroger banner) to buy maraschino cherries for my daughter's school party. It's the first time I've been in the store in months (I usually drive past it to go to Target for my groceries, but they didn't carry the cherries). I confess, the store had absolutely zero atmosphere. I felt like I was shopping in a Soviet supermarket from the '80s, not because it was wildly out of stock (it was stocked and generally well-kept), but because it was so utilitarian and lacking any kind of design ethic that it was actually depressing.

Restaurants are very much about atmosphere and theme. In keeping with the transformation that is rolling through all of retail, part of that transformation involves focusing less on the brands you carry and more on the brand value proposition you provide to consumers, through the brands you carry. Restaurants understand brand, though maybe not to the degree of CPG, but certainly more so than many retailers and especially grocers. Retailers definitely need to learn from that.

That said, I don't think it's just restaurants that are revitalizing the atmosphere side of grocery. HEB's Central Market and also Whole Foods have both been playing in "grocery theater" for years, and many of those stores have restaurants tacked alongside. But whoever did it first doesn't matter - if it brings new life to my sad, sorry little local grocery store, then so much the better!

[Image of: View Braintrust Panelist button]
Nikki Baird, Managing Partner, RSR Research

I don't see atmosphere as a problem but rather as an opportunity. Do customers complain that their supermarket doesn't have the atmosphere they'd prefer or that the no longer visit a supermarket because of its atmosphere? No. But I can see where shoppers might go to a supermarket they don't usually go to because it offers them a better experience, i.e. makes them feel good while they are shopping. If atmosphere as defined in this article can direct consumers to a particular store and have them visit regularly, then those who ascribe to it will be solving a problem we didn't know we had. Kind of like the microwave oven. Who knew!

I was just in Chicago and spent some time in Eataly. I ate lunch there and bought some food for the plane ride home. I can't see shopping there regularly if I lived around the corner. But I would definitely enjoy visiting the store from time to time and would probably buy items that are not typical for me, products more in line with special occasions. And their restaurants would encourage me to come in more often than just the products like wine, produce, cheese, meats. Just down the street are a Trader Joe's and a Whole Foods. Those stores seem more likely to create frequency of visits beyond what Eataly will achieve. While still a step beyond the typical supermarket, they have what shoppers are looking for in product availability; an uncluttered navigation path and you can get out within a reasonable amount of time. So far we've admired the atmosphere and customer experience in those stores, but it's a different definition of "atmosphere" than the article discussed.

Back to the original question. Atmosphere is not a big problem in grocery shopping. However, creating a new type of environment for consumers offers the opportunity to attract shoppers. I believe to hold onto them and see them frequently, retailers will still have to offer the basics of products, convenience and price value.

[Image of: View Braintrust Panelist button]
Joan Treistman, President, The Treistman Group LLC

The new fancy types of markets will do well in high income areas only, as the price points and unique premium lines need that type of consumer to survive. This type of market has been around for many years, from the open air markets in major cities, to neighborhood ethnic treasures, which feature homemade cheeses, pastas, and pastries. The big time chefs recognize that their brand has clout, and have chosen to get into the business, featuring their specialties for all of us to admire.

This will continue to unfold, as smaller niche premium markets will fill the void in cities, where big chains do not venture. I love going to these places when I am on vacation in San Fran, or NYC, as it is a treat to see the wonderful things you can buy nowhere else.

We as store owners must continue to work on creating affordable signature foods for our customers to enjoy, and that is what we all should be doing.

[Image of: View Braintrust Panelist button]
Tony Orlando, Owner, Tony O's Supermarket & Catering

Atmosphere is a huge opportunity in grocery. Most grocery purchases are based on the desire to create a satisfying dining experience for the family, and a reasonably easy cooking experience. To the extent that grocery companies can give customers inspiration, they'll persuade them to purchase more expensive and exotic items, and probably engender significant brand loyalty too.

[Image of: View Braintrust Panelist button]
Cathy Hotka, Principal, Cathy Hotka & Associates

While selection is great, service is still king. Most supermarkets in my area fail at service. It is basically a DIY environment and that makes them commodities. Until supermarkets start to have a real customer-focused environments, these solutions in the article will be window dressing.

Edward Chenard, Innovation Lab Leader, Target

Grocery stores operate with a very low margin. They depend much on volume sales. It's hard to create an atmosphere that is warm and inviting while dealing with the movement of daily deliveries of endless pallets of product. Atmosphere in a grocery store is less important than having well-stocked shelves with easy-to-find items at competitive prices.

WINCO stores that have recently opened in Washington state have proven this to be true. They simply provide well-lit, wide-aisled and well-organized merchandising with prices that can't be beat. They don't even use piped-in music tracks to keep costs down. The have far out-paced their fancier, higher-priced competitors along with more traditional local grocers. Their staff is friendly and helpful - probably a result of being an employee owned company.

Chef-oriented grocery stores will do fine as a niche market in wealthier communities, but not for the average middle-income or low-income neighborhood.

'RetailRetell'

It's a big problem. We've been told by consumers, especially younger ones, that the idea of going into the center of a grocery store is "repulsive." The grocery store of the future will be half fulfillment center and half restaurant experience, to the author's point. Why shop for the mundane when it can be shipped to your house and conversely, why not shop in an environment that addresses all the senses?

Buying online and picking up in-store is being tested now by the likes of Walmart, so I would imagine that once traditional grocers follow suit, it'll be up to them to make the better parts of shopping in their stores (fresh goods) much more enticing.

[Image of: View Braintrust Panelist button]
Lee Peterson, EVP Creative Services, WD Partners

If you just want me to come to your store and buy the basics, then who cares but...if you want me to "choose" to come into your store to be creative about our next meal, get new ideas, venture outside the usuals, atmosphere is everything.

While learning from restaurants and/or chefs can be one approach that works, it is not the only way to create atmosphere and a great customer experience. The brand needs to take a look at who their customer is or who they want their customer to be and create the atmosphere that meets those consumers' needs/wants. But change, they must! And that's my 2 cents.

Lee Kent, Let's meet share and succeed in Retail, YourRetailAuthority

Atmosphere is very important and difficult to create for a broad shopping audience. I think that Tony is correct in that more grocery niche concepts will fill the void created by the large "value marts." I don't think these niche concepts will only exist in SF or NY though. Plenty of demand for them across the US. Shopping is sometimes about savings on a large basket. But as a person who enjoys food, it's also about a relaxing experience away from the plug where I can smell, see, touch, and taste food products.

[Image of: View Braintrust Panelist button]
Larry Negrich, Vice President, Marketing, nGage Labs

This is an issue, but only for people who need "atmosphere" when they shop. For the majority of people, saving money on their purchases is more important.

[Image of: View Braintrust Panelist button]
Kai Clarke, CEO, American Retail Consultants

I would not say that atmosphere is necessarily a problem in grocery shopping. As with all things, there are examples of grocery stores that offer an excellent atmosphere, and others that do not. And that is not a problem if you provide a no frills, discount environment where shoppers choose you because you have the lowest price.

That said, there is definitely an opportunity for grocery stores, especially higher end ones, to increase their service to customers. There is so much potential for this idea. I am sure we have all had the experience of eating a good meal at a restaurant and wishing we could make it ourselves. If you had that meal in a grocery store restaurant, they could provide a variety of options including a pre-packaged set of ingredients and the cooking directions all sold at a higher margin than if you were to pick out those ingredients yourself) to offering a course, led by the chef, in how to make it. This generates potentially three layers of (higher margin) profitability where they would have normally only provided one, not to mention significant upsell.

[Image of: View Braintrust Panelist button]
Alexander Rink, CEO, 360pi

Search RetailWire
Follow Us...
[Image of:  Twitter Icon] [Image of:  Facebook Icon] [Image of:  LinkedIn Icon] [Image of:  RSS Icon]

RetailWire's
Getting Started video!

View this quick tutorial and learn all the essentials...

RetailWire Newsletters