“We are going to get into the meals business. [And] I think you’ll see more of the restaurant business and the supermarket business converging,” Albertsons Cos. President and CEO Vivek Sankaran said during Morgan Stanley’s virtual Global Consumer and Retail Conference earlier this month.
Speaking at the virtual fireside chat, Sankaran addressed the major themes guiding Albertsons’ “transformation,” including, first and foremost, running great stores that emphasize fresh and store brands, according to a Sentieo transcript.
Sankaran defines a great store today as one that is safe and well-stocked with an emphasis on fresh—including meals—along with an extensive own brands portfolio. “[A great store has an] emphasis on fresh … which matters even more today as people eat more at home” and “expansion into things like meals as we know people are going to remain and eat more meals at home,” he said.
Virtually overnight the grocery industry went from an obsession with on-the-go to everyone eating at home in a pandemic-driven recession. And with so much of the workforce working from home, lunch is one area in particular where grocery can grow, said Sankaran, who puts the entire lunch market—both food eaten at home and away from home—at $1.6 trillion.
And as consumers increasingly look to recreate the restaurant experience at home, Albertsons has seen sales of its prime cuts of beef up significantly, along with crustaceans such as lobster. Wines priced over $100 are up 90% at Albertsons stores, Sankaran reported.
The CEO also reported seeing more engagement among its customers with the whole store, but also particularly in fresh foods and meal solutions. “I always believe that we have a strength in fresh, and it’s not just the quality of fresh, but it’s the variety and depth in fresh. Our fresh share gains are higher than our average," he said.
Perhaps the grocer will use its food-focused Market Street banner as a model for stores to come. Albertsons’ Market Street store in Meridian, Idaho, which opened last year, features an expanded in-store food court with an array of restaurant-style meals. Offerings include made-to-order sandwiches, an in-store grill with signature burgers, wood-fire pizza, made-to-order salads and a hot food station with Albertsons’ signature fried chicken and freshly carved meats.