Thursday, July 12, 2018

Amazon brings Whole Foods into the mix for Prime Day

Amazon announced earlier this week that it plans to offer Prime customers $10 to spend on Amazon for Prime Day when they make a purchase of $10 or more at Whole Foods between July 11 and 17. Prime Day begins at 3:00 pm on July 16 and runs through July 17.

Here's how it works. Once a Prime member gathers up at least $10 worth of Whole Foods products, the member must then scan her Prime code in the Whole Foods or Amazon app at checkout. A $10 credit will then be applied to her Amazon account for use on Prime Day. A linked phone number can also be provided at checkout in lieu of the Whole Foods or Amazon app.

Whole Foods is involved in other Prime Day offers as well, including discounts on grocery delivery through Prime Now, and double rewards for eligible Prime members when they use their Prime Rewards Visa card.

Certain Prime member savings and benefits became available at all U.S. Whole Foods locations in late June.

Wednesday, July 11, 2018

The Fresh Market to close 15 stores

The Fresh Market announced yesterday that it plans to close 15 stores in nine states. None of the closings are in Pennsylvania, New Jersey or Delaware.

The closings are expected to take place in the next two to four weeks. Four of the stores are in Illinois, two in Georgia, two in Virginia, and one each in Indiana, Kentucky, North Carolina, New Hampshire and Tennessee.

There are currently five Fresh Market stores in Pennsylvania, two in New Jersey and one in Delaware.

"Over the last eight months, our company has been executing a turnaround plan, and we've seen great progress," said CEO Larry Appel. "However, for a variety of reasons unique to each retail location, that progress is not evenly distributed and, as a result, we have decided to close these long-term under-performing stores."

The Fresh Market, which currently operates 176 stores in 24 states, has had several stores closings in recent years as competition - both online and brick-and-mortar - has adversely impacted sales.

Tuesday, July 10, 2018

Kroger to test unmanned vehicle delivery

Kroger announced in late June that it plans to pilot unmanned road vehicles for grocery delivery through a partnership with Nuro, a California-based robotics and artificial intelligence company.

A test scheduled for the fall will allow customers to place grocery orders through Kroger's ClickList system and Nuro's app, and have their items delivered the same day. The pilot market has not yet been announced.

In addition, Kroger announced a partnership with British online grocery supermarket Ocado to build e-commerce fulfillment centers and build out its e-grocery platform. At the same time Kroger announced a deal to purchase online meal kit service Home Chef, as well as plans to launch Boosted Products in Search, a service that will "enable consumer packaged goods brands to reach digitally savvy shoppers with 'hyper-relevant' products in search results across Kroger digital properties," according to Supermarket News.

Giant Eagle launches Scan Pay & Go service

The Pittsburgh-based Giant Eagle supermarket chain recently launched Scan Pay & Go, a service that enables customers to use their phones or a store-provided device to scan groceries as they shop. The service allows shoppers to keep track of how much they are spending and experience a faster checkout process.

Scan Pay & Go is currently available in two Market District and three Giant Eagle stores.

Giant Eagle operates over 400 food, fuel and pharmacy locations, including over 200 supermarkets, in PA, OH, WV, IN and MD.

Friday, July 6, 2018

Young customers taking to Lidl as older shoppers return to former shopping habits

Two recent studies show how Lidl is affecting the competition, and how the retailer is taking hold with customers.

In a study called "Defending Supermarket Share When Lidl Comes to Town," Florida-based Catalina, which claims to have the world's largest database of shopper history, examined shopper behavior at 83 supermarkets within three miles of 30 Lidl stores that opened last year. The study found that although Lidl siphoned sales and customers from area grocers, these supermarkets recovered much of the losses after only a few months.

According to the study, established grocery stores initially lost, on average, 4.3% of sales and saw declines of 5% in customers and 3.6% in shopping trips after a Lidl opening. However, theses losses decreased over time.

"While Lidl had a significant effect on competing supermarkets during the first two months after its openings, that impact declined precipitously by the third month, as many trial Lidl shoppers returned to their past shopping behavior," the report said.

However, a survey conducted by global consulting firm Oliver Wyman showed that 48% of customers who tried Lidl are now shopping there on a regular basis (more than twice per month). And the survey concluded that shoppers aged 18 to 34 had a particularly high awareness of Lidl and shopped there frequently.

"What Lidl has done so far has struck a chord with younger consumers who are valuing Lidl's good private brand product quality almost as much as their low prices," said Tanja Ebner, principal in Oliver Wyman's retail and consumer goods practice.

The study also concluded the following:

  • Forty-six percent of Lidl customers said their primary reason to shop at Lidl was either good quality, good promotions, or fresh products. Thirty-nine percent cited low prices as their primary reason.
  • Satisfaction is higher in states Lidl entered recently, as opposed to those it entered earlier, which means Lidl may have learned important lessons from earlier openings and has made adjustments.

Vote set for Albertsons - Rite Aid deal

Rite Aid has set a special stockholders meeting for August 9 to vote on a proposal to approve its merger with Albertsons, even as some investors are trying to stop the deal.

Rite Aid has repeatedly stated that the deal is in the best interest of its shareholders. However, some investors have been upset that senior Rite Aid executives will be paid retention bonuses even if the deal falls through. Others expressed frustration that Rite Aid isn't getting a higher price, especially as pharmacy managers are an acquisition target and shareholders see value in Rite Aid's pharmacy benefit management company, EnvisionRXOptions, which has been growing rapidly.

The combination of Albertsons and Rite Aid, which operates RediClinic, would create a company with 319 retail health clinics and 4,345 pharmacies. Rite Aid executives expect the combined company to have a differentiated brand in the U.S. that combines "food, health and wellness."

Giant to open e-commerce hub in Lancaster County, PA

Giant Food Stores recently announced a $22 million investment in Lancaster County, PA. The grocery retailer plans to launch a new e-commerce hub, remodel four stores, lower prices, and open a fuel station in Lititz.

According to a company press release, the e-commerce hub "will be designed with a unique format that offers curbside pickup orders, where online orders are delivered right up to customers' cars parked outside of the hub." Giant also says that the operation will bring 150 new jobs to the community.

The hub will be about 38,000 square feet, allowing Giant and Peapod to serve up to 40% more shoppers. It will be the fifth such facility that Giant has opened in Pennsylvania with Peapod.