Food Lion in Full Bloom in Nation’s Capital
By George Anderson
Food Lion intends to convert forty locations in the Washington, D.C. area to its upscale Bloom store format this year.
Karen Peterson, a spokesperson for Food Lion, told The Washington Times, “We have studied the demographics of the market [in Washington]. “This particular grocery store … certainly meets the needs of the shoppers in this area.”
The Bloom format focuses on perishables and prepared foods and has moved everyday staples, such as milk and bread, near the front of the store to make shopping more convenient for quick trip shoppers.
The stores also make extensive use of technology, allowing consumers to walk the aisles with hand-held scanners to reduce checkout times. Monitors positioned throughout the store also provide shoppers with recipes for the items they are buying.
Jeff Metzger, publisher of Food World, said the Bloom format has “a little of Whole Foods in it, but it’s not organic. It’s got a little of Balducci’s, but it’s not gourmet.”
George Whalin, president and ceo of Retail Management Consultants and RetailWire BrainTrust panelist, said Food Lion is following the same track of many other grocers that are looking to differentiate from the likes of Wal-Mart’s Supercenters.
“The traditional supermarket model is broken,” he said. “It’s why stores like Bloom and Lifestyle (Safeway) stores and companies like Whole Foods are making traditional supermarkets rethink how they do businesses.”
Food Lion first tested the Bloom concept in 2004 with five stores in the Charlotte, N.C. market.
Moderator’s Comment: Is the Bloom format a winner for Food Lion (Delhaize)? What role/consumer niches are addressed by the individual formats operated
by the company including Bloom, Bottom Dollar and traditional Food Lion? –
George Anderson – Moderator
Having worked with Food Lion, I judge their management team as one of the most strategically astute in the industry. Bloom is not so much upscale in its original product mix, which is now changing, but it emphasizes convenience and hassle free shopping. FL took its time to experiment with five test stores before expanding Bloom, another indication of maximizing learning before accelerating momentum. Food Lion’s management understands the difference between a remodel and a retail format innovation that introduces a new value proposition to the market.
No concept will “work.” It is the people who work. Food Lion is on to some very important ideas, and are exhibiting some perseverance in making those ideas work. I don’t know what the implementation will be with a DC rollout, but their concept of the “TableTop,” essentially an upscale convenience area right at the entrance, is a winner. Again, the challenge is tweaking and adjusting to make the whole thing work, and then follow-through to assure that ideas stay a reality over the months and years ahead.
New “enlightened” store formats might be equated to playing slot machines. Sometimes (albeit rarely) you get on a long winning roll and sometimes you don’t, but one thing is certain — nothing is constant but evolving change.
Supermarkets and niche formats change with time and the “Bloom” never stays on the rose forever with store formats. Competition and ever-changing consumer lifestyles mandate revision and refinement. But at this particular moment, the Lion roars and should be recognized for staying in the game by contemporizing its present venue in the D.C. area.
Sounds like Food Lion’s Bloom format is an attempt to stand for something in the supermarket game, in contrast to its plain vanilla main line stores. Adding technology gimmicks is not a strategy in itself, but it may contribute to the upscale image being cultivated.
When a low-price, low-frills operator like Food Lion chooses to compete by introducing new formats alongside old, it accepts that its operations will become somewhat more complex and that its scale economies will be somewhat diminished. This not a choice made in the absence of market pressure. Could it be another indicator that conventional, me-too supermarkets are not long for this world?
I think zip codes play a significant role in the success of these new formats. Food and cooking have taken on an entirely new importance, especially in the affluent enclaves of America where homes come equipped with professional stoves.
It would be interesting to track the rise of cable TV’s Food Network against the trend of upscale grocery stores. Ten years ago, there were only a handful of cooking shows a consumer could watch. Today, there are literally hundreds of hours per week. I can’t decide if the Food Network created the need or filled it.
But Wholefoods, Harris Teeter, Bloom, and Safeway’s Lifestyle all tap into the same Zeitgeist. It has always been my theory that Whole Foods was the Starbucks of grocery. They both appeal to a kind of fetish fascination with preparation, and target trends such as Small Indulgences, Staying Alive and Cocooning. Trends that Faith Popcorn predicted more than 15 years ago.
One could compare the rise of Starbucks and the changes they wrought upon Dunkin’ Donuts to the rise of Whole Foods and the changes they are sparking among grocers. If there weren’t a Starbucks, Dunkin’ Donuts would have never served individual espresso and cappuccino.
The olive bars I see in so many grocery stores today are a result of entrenched market participants playing catch-up with the market upstarts.
We have a home near a Food Lion in Virginia and my wife used to shop there. Harris Teeter opened a new store in October an equal distance from our home. I do not see her going back to the Food Lion any time soon, unless they convert the store to a Bloom concept store. But then again, this is all very zip code specific.
Food Lion grew fast in the 80s and 90s as a chain of a lot of low volume stores spaced closely together. I don’t know how Bloom will do and Food Lion has not released any meaningful data on the stores. So far, I have not heard of any competitors losing any sleep over this just the same way the competition is not too concerned about the Safeway “Lifestyles” stores. I’ve heard lots of talk about their success but no meaningful numbers to back it up. Often, when a chain develops a new concept, it looks promising. That is because they have devoted so much time and effort into just a few stores. However, when trying to devote the same amount of quality effort into a large number of stores, what usually happens is the stores slowly evolved back to the way they were. Time will tell.
The riddle: is there a defensible position between traditional supermarkets and Whole Foods? Or will Whole Foods, after a greater rollout, wreck the “Upscale Lite” competitors? Middle positioning is very difficult. It’s easier to be extreme: the high or the low versus the compromise. In the bricks and mortar bookstore business, the superstores destroyed everything significant in their path. The book category is really extreme, since there isn’t significant space for 2 positions; let alone 3.
The Bloom concept will certainly pay off for Food Lion, so long as they combine it with the excellent customer service and highly trained and motivated store personnel which this requires. The mix of upscale products, technology and consumer friendly store layout (i.e. differentiated traffic patterns to segment their target market’s product needs) has proven a great combination for those who have implemented it. The key to this success is customer service, highly trained (and friendly) store personnel, and a customer-centric store environment. The Bloom concept certainly has focused on the latter, but their success will rest upon training and motivating store personnel whose focus is on delivering world-class customer service, everyday, all-of-the-time.
It’s a good concept, and a clear winner, but I don’t know what “long term staying power” is anymore. Cycles of formats seem shorter and shorter. It’s a vast improvement for Food Lion; it took guts, and there’s real innovation there. I like the term “upscale lite” that someone used. It’s a good thought provoker. Is this really “upscale lite?” Or in fact something that can survive a Whole Foods onslaught? Time will tell, but I think comparing and contrasting the styles of Bloom, and even Safeway Lifestyle, with Whole Foods is a useful and interesting exercise. Personally, I see sufficient differentiation to allow Bloom to keep its niche for the next several (five?) years, until an evolutionary “something else” comes along.
Very interesting concept. Personally, I’m a huge fan and I think it’s a great way to offer something to differentiate themselves from Wal-Mart. Adding intangibles seems to work across industries. In Phoenix, some golf courses have the GPS tracking on the golf carts, and they tout that fact to attract players. Technology perks can be a great addition.
Having never been in one of the stores, my only concern would be polarizing some consumers. Those that are technologically adverse may be completely turned off. To them, it might make the simple task of grocery shopping confusing and, therefore, stressful.
As has been said already, superior customer service is the key to this. The technology can not be a replacement for people. Some would say you don’t even need the technology to differentiate yourself from Wal-Mart if you have the customer service. Next time you are in CT, go to Stew Leonard’s. You’ll see why people drive 30 miles to go there and even pay higher prices for some things. It’s an experience.
Major departure from the old Food Lion. Sophisticated consumer research, extensive testing and marketing prowess has brought this very progressive operation to the forefront of consumer convenience, and a comfortable shopping experience at that.
FL has found a couple of formats to separate itself from competitors.
It will be interesting, with the addition of Bloom, to observe how Giant Foods and the boutique shops are viewed by shoppers now. Hmmmm
Unfortunately, I don’t have the hard data to back this up. But having walked a few of the stores in the Charlotte market I definitely think Food Lion is on the right track with Bloom. And the D.C. Diva’s are a perfect target.
On the other hand, a stronger departure from Food Lion’s core positioning and market cannot be imagined. So do they have the marketing savvy to put (or keep) the right store format in the right market? I’ll bet yes.
Any concept in the Washington DC area that reinforces the anointed public’s feeling that they are better than the average American should do particularly well. If the bureaucrats can utilize their ubiquitous Blackberrys to do anything in the Bloom environment, then Food Lion will have a winner. Those who look at involving consumers and stroking egos as a no no will see DC as a great disappointment. The key to anything in this most selfish of towns is sucking up. If Bloom can position itself as a store for the elite and informed, while discouraging the “locals” by intimidating them with technology, then you will have the grocery version of Starbucks. I say keep them in the grocery and out of session!