NOT LONG AGO, I sat down at my dining room table to make a list of all the places I go grocery shopping. It quickly turned unsettling.
Let me explain: When I was growing up, my mom would occasionally stop at a gas station for a gallon of milk, but she bought everything else at ShopRite and Better Valu, the two big supermarkets near us. Judging by the time she spent chatting with people in the aisles, everyone else in town did, too. But as my wife and I shop for our family 25 years later, we can’t imagine getting everything we need — everything we want — at just two places.
So we regularly visit seven. For stuff like boxes of pasta, cold cuts, and frozen food, we flip-flop between Stop & Shop (which is particularly close) and Market Basket (which is particularly cheap). Then we go to Costco for toilet paper and to a place in Lexington called Wilson Farm for fruit and vegetables. Setting a new low for laziness, we recently started getting heavy boxes of cat litter delivered from Amazon.com. When we need a gallon of milk, I drive to a nearby plaza that has a Trader Joe’s and a Walgreens, then choose whichever store is closer to my parking space.
Laying it out like that, it all seems excessive, even a little crazy — imagine the time I’d have for cooking if I spent less of it driving around. Who in the world shops this way?
Well, I’m happy to report, just about everyone. My family’s shopping style is “not unusual — in fact, it’s very normal,” John Rand assures me. He’s a senior vice president in the Cambridge office of Kantar Retail who has been working in and studying the industry for 45 years. “Consumers are splitting the ticket more than they ever did. They’re going to multiple outlets, not all of which are supermarkets, and sometimes even multiple supermarkets.”
Seventy-six percent of Americans now visit at least five “channels” for food — places like supermarkets, drug, and dollar stores — according to an August 2012 report from SymphonyIRI Group, a research firm in Chicago. Only 3 percent of us visit only one or two channels. Even my mom now shops at four.
On average, a Boston-area family spends $8,066 a year on food, according to government statistics, but nearly half of it goes to things like restaurants and takeout. That leaves everyone selling groceries to tussle over only $4,870 per family. And for some time now, the traditional supermarket has been losing ground in the fight.
Once the only game in town, supermarkets today only get about half of US grocery sales. Twenty-five percent goes to Walmart, which only introduced its Supercenters in 1988. Target is squeezing full food sections into many of its locations, including dozens in Massachusetts in recent years. Walgreens and CVS are now carving out more space for food on their shelves, and dollar stores across the country are adding freezers for items like pie crust and frozen vegetables.
Offered this smorgasbord of options, today’s shoppers have become incredibly picky. Our sole loyalty, Rand says, is to our ability to find the best food at the best deals, behavior that increased during the Great Recession and still continues.
This has had dire consequences for some local stores. Johnnie’s Foodmaster, a 65-year-old area chain of 10 stores, is reportedly in talks to have many of them taken over by the much larger Whole Foods. Supervalu, the struggling conglomerate that owns the Shaw’s/Star Market chain — the second largest in New England, after Stop & Shop — has been reportedly looking for ways to get rid of it for years, but can’t find any takers.
“I might argue that [supermarkets are] in the toughest times in recent years,” says Susan Viamari, a Southwick resident and the author of the SymphonyIRI report. “Traditional grocery stores now are really under fire by other channels looking to compete for share of stuff that has always been their bread and butter, no pun intended. You can get groceries in so many places that it’s intensely competitive right now.”
Supermarkets are responding to this new reality by retooling their selection, the layout of their stores, and their marketing efforts. Rather than trying to attract everyone, they’re tailoring themselves to people they’ve identified as their best customers. And if you happen to be one of them, the industry’s struggle can be pretty good news. Because, as a supermarket CEO said recently, “today’s customer has all the power.”
AT THE DAWN OF THE GREAT DEPRESSION, a 46-year-old manager of the Midwest’s Kroger chain had a revolutionary idea. Michael Cullen had worked in grocery stores since he was 18, but they hadn’t changed much over the years. Most were only a few hundred square feet and offered a few hundred items, almost all in cans and boxes a clerk had to retrieve from behind the counter. Customers who wanted bread or produce were usually out of luck; they had to make trips to the baker or greengrocer for that. Continued...