As economic uncertainty continues to loom over most of the country, Americans are watching their money and shopping less. But while that fact might spell doom for the nation’s retailers, there are a number of opportunities available to those companies who are able to look at how consumers are changing their behavior and innovate in how they do business to leverage these changes.
“Big Players Think Small in Format Fights,” an article in Consumer Insight by Todd Hale, senior vice president, Consumer & Shopper Insights with Nielsen, outlines how the economy is affecting retail channels and what some retailers are doing to attract new customers. For example, the key grocery chains are launching smaller stores in urban areas with a focus on packaged fresh food offerings. Tesco launched the Fresh & Easy format in 2007, with plans to open 200 stores by the end of 2009, while Walmart is fine tuning its own small scale pilot, with a strong fresh and private label emphasis with their Marketside format. Safeway opened The Market at Vons in Long Beach, while Supervalue opened a prototype called Urban Fresh in the Chicago area. The stores feature upscale inventory in bright, well-organized layouts with sampling stations near fresh sections, a robust private label offering and designed to appeal to both those who like to cook from scratch and those who like prepared foods.
“From alternative formats to alternative merchandising and assortment ideas, 2008 proved that a marketing opportunity lies behind every perceived market downturn. If big stores no longer make economic sense, downsize the footprint. If consumers are cocooning and watching movies at home, bump up your DVD catalog. When competitors co-opt traditional product lines, diversify by adding services that distinguish your format and build loyalty,” said Hale.
To read more about format changes, channel trends,. ad spending and other ways retailers are evolving with the economy, view the full article here