Redesigning Supermarkets to Better Engage Shoppers
By Al McClain
We know consumers are all about VALUE and PRICE these days and are watching
every penny. Yet, Kevin Kelley, Founding Partner and Principal of Shook
Kelley, reminded the audience at an FMI Customer Connect workshop this week that
consumers still snap up items like iPhones, iPads, gourmet coffee, and tickets
to Avatar, spending money when they really want something. Kelley
believes consumers have become internet-empowered experts at categorizing products
as commodities or products that provide meaningful experiences. So,
retailers either have to become proficient commodity sellers or drive sensory
rich experiences that connect with consumers physically, socially and emotionally.
Yet,
supermarkets often look old-fashioned — laid out with long, narrow
aisles, accompanied by old-fashioned signage, lighting, and merchandising.
Consumers hurry in and out of these stores as fast as they can. Kelley
advises recreating the shopping experience and cited several examples of brands
and retailers that were able to re-engage shoppers by breaking up traffic flow
and encouraging shoppers to linger in more appealing spaces.
- A
redesign of Nabisco cookie and cracker sections, for instance, made them
look more like kitchens, complete with kitchen tables, drawers, wood strips
and menu cards. Female shoppers in particular felt that the areas reminded
them of home and that they felt neat, attractive and unique. “Bump
outs” were added to aisles to break the traditional pattern and literally
give shoppers the opportunity to pull their carts out of traffic to linger. Â Passageways
were created between aisles to create more random traffic flows and encourage
shoppers to meander instead of barreling down an aisle in a hurry to get
out. Sales
went up in double digits. - Kelley feels the front end often provides
a terrible experience for shoppers, who see the checkout as a loading dock
and actually develop “line rage” as they wait for pokey shoppers
to write checks, pick a line, etc. Since retailers really can’t make
the checkout process fast enough to meet shoppers’ standards, the
idea is to redesign the area to better entertain shoppers while they are
in line and give them opportunities to pick up “grab and go” items. - Convenience
stores have problems too, and often are designed in hodge-podge fashion.
They have merchandising elements that don’t work together, and their food
offerings and consumption areas have limited appeal. Meanwhile,
operators like Trader Joe’s and
Fresh & Easy are doing a good job of providing quality food and a convenient
experience. Kelley suggests redesigning c-stores so that they are circular,
with a sense of movement, and focusing on key sections with L-shaped pods
rather than traditional aisles.
So, it really comes down to making the store look better,
either one aisle or category at a time, or via redesigning the whole store.
Still, a May 10 article in Supermarket News makes the case that in order
to appeal to ‘convenience
shoppers,’ supermarkets need to make the store easier to shop, which
could mean helping shoppers get in and out more quickly, vs. encouraging them
to linger.
One area
where Kelley and Bill Bishop (quoted in the SN article) seem to agree
is the idea of putting items such as milk, bread, and commonly purchased items
near the front to improve ease of shopping. In this same article, John Rand
of Management Ventures notes that “the store is set up to be efficient
for the operator, not for the shopper.”
Discussion Questions: Should supermarkets be redesigned to encourage shoppers
to linger or to get them in and out more quickly? What should operators
consider when thinking about redesigning sections of the store vs. overhauling
the entire store?
The question today may be too “either/or” instead of “both and more.” There are parts of the store where you may want shoppers to browse, to read recipes, etc. (I’m particularly thinking meat, produce, and wine). There are other areas where shoppers are going to want to get in and out and making room to browse is likely a waste of time (I’m thinking cereal, canned veggies, carb bev). Do both and see what happens. But test for more than a week or two. The increased sales are likely due to a change other than the specific change made–see if it is sustainable.
It depends on the kind of operation you are. I have one client that does $600k+ per week in 28,000 feet. The last thing he wants is for customers to linger in his store. He keeps all registers open during business hours manned by fast and skilled cashiers. His goal is to get them out the door and into their cars to make room for more customers. On the other hand, if you are just an average vanilla store doing only average sales per square foot, then it’s probably a good idea to redesign your store to keep customers around longer.
In our haste to become more efficient we often forget that retail is theater. Research has shown that the longer a customer is in a supermarket the more she will buy and the quicker that we get her out the sooner she will come back.
I believe there is much that can be done at checkout that can enhance the convenience function, for example, easy pass checkout or dedicated/scheduled check out lanes and times for large basket, loyal customers.
However, convenience and ambiance need not collide. I suggest that we look at the specialty stores in the malls as a model of how it can be done. These stores have warmth, purpose, and are still convenient to shop. Category management and other concepts have made us pretty efficient in viewing the shelves. Unfortunately, this approach puts our back to the customer. We need to turn around and face customers and get rid of the boredom of supermarket shopping.
This may not work for all retailers, depending on the store’s positioning. Stores need to think like a brand and act like a retailer. Thinking like a brand requires food retailers to develop a differential advantage beyond simply price. Store layout and the accompanying ambiance is a way to become the retailer brand of choice.
It’s back to “perception is reality.” If you modify the environment and shoppers think that the store is difficult to navigate or increases their shopping time, they won’t come back often enough to see a lift in sales.
There are many reasons consumers need to get in and out fast…at least some of the time. Make the store feel inviting but compatible with shopping convenience and the best of both worlds have met. Note the categories which lend themselves to lingering and invest in them.
But never never create obstacles.
Take a message from advertising and direct mail…larger type and bullet points encourage readership. The same message in small continuous type is overlooked. There are ways to encourage engagement at the point of sale, just as in advertising.
In store navigation should feel easy and seem helpful to the shopper’s cause. However, it can be planned so that it enhances the retailer’s purpose as well.
The arising public is looking for new “everythings” … and redesigning the supermarket is a good target idea. So let’s do it; but there are challenges. For instance, you would need to offer something greater than “lower prices.” And by putting bread, milk and commonly purchased items up front as suggested in the article and providing “lingering” lounges in other areas, would that segment the supermarket into differentiated selling areas with limited spending appeals?
Any future supermarket design could benefit by giving the store a SOT–Sense of Theater–that tends to entertain the largest majority of the customer base. That should encourage lingering by most shoppers which in turn should produce more spending. And it might encourage the “in-and-out” crowd to spend a little more time in that theater. I always felt that was Stew Leonard’s big appeal. Anyway, let’s get on with it.
The redesign of a store would, I am sure, be interesting and hopefully a sales building tactic. But I look towards retailers like Costco and Stew Leonard’s that continue to exceed their customers’ expectations, not by store design but by creating an experience within the four walls that is entertaining, focused and enjoyable… and quite frankly not trying to create a full shopping solution but a destination for fun, quality, and information.
Absolutely; consumers still snap up items like iPhones, iPads, gourmet coffee, and tickets to Avatar, and spend money when they really want something. However, for whatever reason, the SKU-rationalization “experts” have decided that supermarkets and chain drug stores should carry only what consumers, “need,” and not what they “want.” This erroneous mindset will cost the FDM mass markets good and plenty in the long run as consumers look elsewhere to buy not only what they need, but also what they want!
There are retailers doing just this. Wegmans has built its business on the idea of experience without trading off efficiency. Food Emporium’s Bridge Market is an ideal example.
However, in both cases, there is a distinction between where shopping can be interrupted and where interruptions make sense. Be assured, it is not in the cookie section. These retailers, and others, seem to understand very well what works and what doesn’t. There is no need to reinvent this wheel.
As the SN article shows, there are many reasons why consumers visit the supermarket and the reason can vary for the same consumer at different times. I think the opportunity here, is for retailers to better link their cyber and physical presences. The first question on the cyber store should be “Why are you visiting today?” The virtual interface to the cyber store would change to meet the consumer’s objective for that visit. In all cases, the result would be a shopping list that makes their visit to the physical store as efficient as possible.
This way the cyber store can be used to extend the marketing message to receptive consumers and expedite the shopping experience for those who are time pressed. By combining this with targeted retail pricing, the cyber store can be the lure to the physical store.
Concur with the ‘both and more’ comment.
The key is understanding trip missions and finding a way to meet the needs during those missions. If you create a store that creates the ‘linger’ effect, then you’ll have better brand equity and you’ll increase basket size on those more deliberate trips. However, many consumers will realize that the store is a time-suck and will forgo a trip there when they are rushed. To meet the convenience need, maybe you incorporate the convenience store-within-a-store idea that Herb Sorensen has talked about so often.
Interesting how the Supermarket Industry is trying to jump ahead of the curve and create ways to make the visit an enjoyable experience. I applaud the industry leaders who are doing this. Wegmans is one. Another would be Ukrop’s who was part of an earlier discussion this week. Go for it and be successful.
There is not just one answer.
Stores should first understand their core shopper profile and design their store interior to meet this need.
If their shoppers are buying for their families (and entertaining) they will respond to ideas and should consider placing meal recommendations together. The ideas can be combined; for instance a center aisle of most frequently purchased items and, depending on store size, promoting meals and entertaining on circular fixtures. This store should be fun to shop. On the other hand if the store is small, it should make it easy to get what they want to take home. While this is a “one-time expense,” if it increases profitable sales, the ROI will many times cover the cost. (It will require a major investment to change the Buehler’s as shown.)
For more information, please see Sandy Miller’s Bio and other Miller Zell presentations.
Consumers will love a more interesting store experience as they stroll around the aisles. But retail needs to address the 20-minute buzzkill at checkout…there are only so many tabloids to read while the undermanned checkers scan and bag.
Just what is needed! More sales destroying advice about how to keep shoppers in the store longer. No wonder an executive of one retailer who had spent $10 million on completely rebuilding two stores, using this kind of thinking, and getting ZERO lift said to me, “A whole lot of money for a whole lot of nothing.”
Self-service retailing has spent 100 years ceding the selling process to the shopper. (Self service = “shopper, sell yourself.”) Any real salesman knows that the faster you can get to the close, the faster you sell, the more you will sell. Our data shows that for every second longer it takes to close one dollar of sales, it costs the store in aggregate one million dollars of annual sales. There is a SERIOUS need for speed!!!
We have spent the past few years studying the SELLING process, as distinct from the merchandising process, and have found it to be not complicated or costly, but because it is counterintuitive to the existing self-service retail mindset, not readily embraced by a $14 trillion global industry. Ah well, no wonder super-success is reserved for the super-few! 🙂
Between 2002 and 2004, Marsh Supermarkets, LLC, where I served as VP GM/HBC, completely redesigned the supermarket store concept by arranging part of the layout by “meals,” rather then by categories. Breakfast foods were all merchandised together as an example. This new concept was launched in both new markets and existing markets with about 5-6 stores. The design was intended to make meal planning/purchasing more efficient and help expand the customer’s menu alternatives. Coffee bars with seating occupied open areas in the center of the store. The perishable areas also incorporated non perishable menu products for incremental purchases and easier meal planning. The store became more of a “shopping experience in the round,” unlike any other supermarket in the area. The one important missing component was that the customer was just not ready for this much innovation. Because every item was in a new location and the format was so different, the customer shopping experience took much longer then with straight aisles and traditional category adjacencies. The concept was very intriguing and if “time” was not so important, it may have worked. The learning was this: make certain that your customers participate in the format design and that they actually want and will support new innovations to a traditional store format.
Before we continue to bash the “SKU rationalization experts” let’s stipulate that it is easy (perhaps far too easy) to go too far.
Having stipulated that, let’s go back to those halcyon days when a shopper could be confronted with, say, as many as 8 different sizes/containers of Heinz red (not the green, not the purple–just the red) ketchup. End result, not 8 times as much variety, however, other desirable items not on the shelf (either because not stocked or OOS due to single facing), larger stores (longer to get through as the shopper wends her way down looooooooooong aisles of items they don’t, and likely won’t ever want), higher embedded costs, etc.
There’s a reason why intelligent SKU rationalization makes sense for the shopper and the retailer (though the fellows in charge of seemingly infinite variations of the same product or line extensions may find their business models hindered).
Methinks a bit of self-serving promotion on the part of the industrial design community; it’s not very hard to show “gains” with anecdotes and cherry-picking case studies, but even if true what exactly is the message? Is a store to be redesigned to showcase each of hundreds–make that thousands–of SKUs? My biggest complaint in shopping in a market is that they are constantly moving things around; “both and more” …fine, just keep the mustard in 1B/lower left, please.
Ok, since I’m a little late to this party today, I’ll play the wet rag: did anyone mention cost? Labor? Increased sales? R.O.I.? If there’s one thing we know about grocers, or most retailers for that matter, but particularly grocers (due to very skinny margins, especially lately) it’s always about proof of concept. It would be great to have desks and chairs and cabinets and sales help in the aisles, but who’s buying? In most cases, the grocer will look to their vendors for those dollars, but if it doesn’t substantially bump sales for an entire category, you can forget it.
Whole Foods provides the best environment now (sure, H-E-B and Wegmans too) because they have the best margins. But does that apply to other, mid-market grocers? You know, the vast majority of them?
So, the answer is “yes” to both convenience and lingering (depending on brand) and improved customer experience in general…but I do believe that most grocers would follow that type of thought with a firm reply of, “prove it.” Can we?
This rather wide-ranging set of comments presents a useful reminder about the natural tension that seems to exist between shopping efficiency and selling effectiveness.
In general, I concur with Herb above, in that any experience that adds “friction” to the shopper’s path should be avoided. As a corollary I would add that any store feature that is intended to distract a slowed-down shopper sends a negative message about the store operator.
“Studies” may prove that longer shopping trips equate with larger baskets, but the causality is suspect. I’d submit that the total return to the retailer on strategies that lengthen the trip is a negative number.
The SN list of shopper types reveals the dilemma facing the retailer who wants to please everybody all the time: Each shopper is a different person, with a different mission, on each trip. Sometimes, they shift into a different persona or decision style upon reaching the next aisle within the same trip.
This may blow retailers’ minds a bit, but I can offer one concrete observation: Make the experience as friction-free as possible in the aisle and never, ever make ’em wait to pay up front. The last impression your store makes will define your next opportunity to serve that shopper–and that’s where your profit opportunity lies.
I’ve posted here more than once how retailers in general (grocers, department stores, etc) tend to look much like they did 100 years ago. This kind of thinking in the article aims at disrupting the habitual shopper path and get more SKUs noticed. This is not necessarily for efficiency, but it can be, it is to drive revenue growth. I love mixing up the traditional center store grocery aisles. Should we try new ideas in every size and volume of store? Yes! A store can create a new traffic flow without impairing traffic flow. Bottom line, I like this thinking. We could push the envelope even more than this. I still think we’re being conservative as an industry.
I certainly like the ideas of being more creative and making the experience more positive for consumers. I am not sure that I agree with more lingering. I am more about connecting to the consumer and helping them have a more efficient experience. Publix seems to have this figured out better than most.
Shoppers want simplicity, ease of access to product, and checkout. They want the products they need in stock and in locations that they know they will be. They want either lower pricing, value or convenience. Their ability to pay certain levels of price elasticity will be driven by what they are looking for in the shopping experience, yet in this crazy/hyper busy norm, I cannot think of anyone who would want to spend more time in the store. Shoppers want less choice, not more. They want more time for themselves and their family, not for shopping.
The center store is constantly evolving, but it is a well known fact that customers don’t want to be surprised. They want their breakfast/cereal foods together and their baking ingredients together.
I am happy every late September when the first shipment of Jane Parker Dark Rum fruitcake arrives at my local Great A&P banner supermarket. I know exactly the endcap where it is stocked. I get this tingly feeling that everything is right with the world.
Yes, the self-service environment created by Piggly Wiggly years ago has been the cornerstone of center store layout for decades. Customers expect aisles to be navigable, and not too long. When you shop a 150,000 sq foot Market District store, a break in the long aisles is welcomed indeed. Likewise foodie delights such as the flagship Food Emporium 59th St. Bridge Market location in Manhattan, really know how to celebrate food by staging it in all its glory. As long as the core center store can be tweaked for efficiency and effectiveness, why mess with something acceptable and time proven?