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Fresh innovation is essential

The biggest risk for grocery retailers in managing their fresh departments for 2023 and beyond is not deliberately innovating within the department, IRI’s Jonna Parker suggests.
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Growth in fresh and success for the store or banner or company overall will not come from trying to reset to 2019, she says. Consumers are different. Where and how they work has changed. How they’re comfortable shopping has changed. And what they expect from grocery retailers has changed.

That means recognizing that a three-pack of pork chops or chicken breasts may not be the ideal pack size for a two-person household. And that there are merchandising and recipe possibilities for seasonal produce that can go beyond displaying apples together with caramel dipping sauce. Consumers still crave convenience and still want help in putting delicious but uncomplicated meals on the table, Parker suggests, and those retailers that are able to speak to these needs can build relationships that outlast inflation, even if consumers continue to consistently shop more than one or two stores to meet their grocery needs.

“What I fear is the grocers who are trying to be all things to all people,” Parker says. “The reality is if you look the same as everyone else, you’re probably not doing that well.” She points to the long-running battle in Chicago and its suburbs between Albertsons banner Jewel and the now-defunct Dominick’s—a battle that played out before Walmart, Target and Costco surged in grocery, one that ended when Dominick’s finally closed its doors at the end of 2013.

“What Chicago was missing was what Wegmans is to the East Coast or Hy-Vee is to rural, center America,” Parker says. “They stood for something different. Jewel and Dominick’s basically came down to who did you prefer. And a lot of that was, who did your mom shop at?”

Most shoppers today don’t hold that kind of one-and-done mindset, she points out.

“What I hope we see starting in 2023 is retailers looking toward the future, taking risks,” says Parker. “Because by the end of this decade, I think the ones who tried to go back to what they were doing in 2019 will be the ones who have tough times come 2030.”

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