Retailing in the Week Ahead Week 28, 2019

Last week we talked about space allocation in our annual study of ‘Ultrafresh’. This week we continue the discussion related to tradeoffs retailers need to make for Ultrafresh come to life. The second investment is ‘’expertise’. When doing Ultrafresh well and meaningfully, retailers need to hire or partner with experts and then communicate this expertise to consumers.

You can see this clearly in many stores when you approach a service counter, such as a butcher. If the butcher is knowledgeable and chatty, you can ask questions about the cut, the flavour, pairings, best way to prepare, how to cook, how long to let sit and so on.

The challenge with Ultrafresh when it comes to fruit and veg is that, done properly, an Ultrafresh retailer may have dozens of SKUs all requiring different levels of conversation and the conversation may change daily.

This requires a lot of skill and therefore getting the right staff in a chainstore environment is complicated, if not impossible, particularly at hundreds of stores across all operating hours. The good news: digital communication is now filling the void.

So, which retailers are doing a great job of connecting their ‘knowledge’ of Ultrafresh to their digital content, to their stores, and to their staff?

This year, we asked our analyst teams to look at this question across two investments. The first was the type of shopping experience the consumer would have. On one hand there are shoppers looking for a grab-and-go experience. The consumer knows what they want, gets it, and moves on. On the other hand, there are shoppers seeking advice, ideas, inspiration and guidance. They want to know what tastes good, what is easy to cook, how to have fun, and may even want help preparing for a party.

Remmber, Ultrafresh can change daily, while angled shelving has become the standard for showcasing the offer.

The second was the type of communication the consumer would receive. Some shoppers want ‘old world’ communication such as an in-person conversation, a television ad, or a magazine to read. Other shoppers demand digital aids such as social media, online favourites, or online order with delivery.

Using this framework and looking at just one item – strawberries – we discovered some big changes in the ways retailers go to market in 2019, especially when compared to 2014.

These are:

  • Rounded pricing and Line Pricing. Many retailers have shifted from complex pricing such as £1.89 per item with a buy two get the third 50% off to a much more straightforward message of everything in the category for “£2.00”.
  • Social media. Social media has taken a much bigger role in helping consumers discover things, especially when it comes to recipes and pairings.
  • User-Generated Content. Likewise, retailers are doing a much better job of getting consumers to leave a comment or a suggestion.
  • Sponsored Ads. Many retailers are doing much more with suppliers to get sponsored items related to the ‘focus’ item.
  • Angled-shelves and trolley spaces. Finally, one big change since 2014 has been the nearly universal switch of presenting Ultrafresh items on angled shelves combined with wider spaces for trolleys to make their way around the items without overcrowding or reducing visibility.

Unsurprisingly, some retailers are doing better work than others. Here, we call out some surprising findings when it comes to the tradeoffs some big-name supermarkets have made in the race to winning the battle for Ultrafresh in 2019:

  • Tesco: Since 2014, Tesco has done a much better job using digital content to give shoppers ideas, inspiration, advice, ideas, information and pairing suggestions. This has been backed aggressively by above-the-line media investments.
  • Morrisons: Morrisons has made their ‘serviced counters’ the heart and soul of their messaging and this comes out in their digital personality.
  • Amazon: In 2017, Amazon bought Whole Foods and since then has done a large number of localised adjustments to make their Ultrafresh credentials – primarily via partnership and personalisation – come to life. The average consumer to Amazon probably never sees or notices these improvements, but the hardcore Prime members that do everything on Amazon are having the time of their lives.

Honourable mention(s): Asda has done a huge number of new activities related to charities and children’s health and, while this comes to life in-store, it has yet to transition into a fully-fleshed out online/offline personality. Aldi and Lidl continue to do excellent digital work, but the in-store experience is still primarily a ‘grab and go’ environment.

To see our findings in more detail, please click to the associated PowerPoint presentation.

With that, we hope you will tune in for our weekly updates on Ultrafresh – British Strawberries & Cream.

Please also consider signing up for our upcoming European Discounters workshop on 1 October. You can get more information by clicking on this link.

If you did not have a chance yet, please also have a look at some of our big featured items from Week 27:

The Retail Reveal: Exploring the Experience Economy
The Fundamentals of Online Search
Russian Retail Monthly Digest: June 2019
China’s O2O supermarkets remain a work in progress

Good luck in the week ahead.

Regards,

Ray Gaul – Ray.Gaul@Kantar.com and @Kantar or @RayGaul on Twitter plus LinkedIn.

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