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Changing a Supermarket Liability to an Asset

by webmaster — October 21, 2010

I think that one of the most difficult challenges in the supermarket industry is trying to change the “stripes” a store has developed over many years. By “stripes” I mean trying to shed the reputation that a store is dark, dirty, dumpy, poorly stocked and poorly serviced into something different. The adage “putting lipstick on a pig” might be a fair analogy. Consumers have etched in their minds what the store will deliver and it’s virtually impossible to change that impression.

At the other extreme, the challenge can be equally difficult. Can you imagine trying to re-brand a store that earned the reputation of being an extremely high priced, even out-of-reach store, with a sales foundation of specialty items catering to the occasional shopper?

Most major cities in America have one of these store groups. The finest quality meat, deli, bakery and specialty items at outrageously expensive prices, and a center store that simply never gets shopped. Some have chandeliers, expensive artwork showcased throughout the store, mahogany fixtures, Italian slate floors and even water features.

Back to the extreme challenge…we have a customer here in our hometown of Phoenix that took this challenge on. A local chain, AJ’s Fine Foods, is a collection of small stores (16,000 to 25,000 square feet) that cater to those seeking the very best quality at any price. However, their newest location didn’t survive its second birthday and closed down. An enterprising independent operator, Darin Hill, accepted the challenge of reopening the previous AJ’s location with a completely new brand that we developed with him: Good Food Market. Offering great, high quality foods and very competitive prices, it’s an interesting concept. The challenge is introducing this concept in a facility that comes with a pre-existing “high priced” reputation and image.

Over the coming months, you’ll probably hear more about this great startup enterprise as Darin expands his store base to more Good Food Market locations. I’ll also save some of the success for later, since the jury’s still out with the new format having just opened two weeks ago. So far, it seems the format change is working well.

As you can imagine, the challenge is akin to taking a Ritz Carlton hotel and converting it into a Holiday Inn. Take out the expensive-looking fixtures and present your new brand, shedding the “baggage” of the previous tenant.

As I mentioned earlier, we can go into more detail later about the strategies used to help accomplish and introduce the new “Good Food Market” brand, but here’s one example of taking a liability and converting it into an asset.

As you enter the location, there is a huge three-tier water fountain; you cannot enter or exit the store without navigating around it. A three tier fountain doesn’t exactly translate to “here’s a comfortable place to shop with very reasonable prices,” so Darin thought it would be best to remove the fountain completely. With a short timeline to get the new store opened, and a landlord that didn’t care for the idea of removing the outdoor fountain, Darin decided to make the fountain a symbol of his connection to the local community.

He converted the fountain to a place where customers can make donations to local charities as they enter or exit his store. The fountain is no longer a daily reminder of the previous format. It’s now a subtle reminder to every single shopper, every day, that Good Food Market is a store that cares about its community.

Stay tuned in the coming weeks for more examples of how Darin is convincing shoppers that he truly has a new and unique brand.

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