April 2012
Pink Slime Is (Almost) Gone, What happens next?
For most shoppers, the headlines about “pink slime,” what the beef industry calls boneless lean beef trimmings, were upsetting and stirred emotions to the point that retailers, fast fooderies and the producer itself took action to eliminate the filler; which also acted to help reduce pathogens that could lead to food safety problems. Even Dr. Elizabeth Hagen, USDA’s Under Secretary for Food Safety was compelled to make a statement to explain the process and situation.
This column is not about “pink slime” and whether it is good or bad – it is about what happens next.
We have already seen food retailers across the country from Stew Leonard’s to ShopRite to Kroger to Safeway to Fresh & Easy advertise in-store and elsewhere that they do not sell ground beef with the ingredient; hoping to reassure their present customers and attract new ones. The Associated Press reported that Fresh & Easy has gone so far as to promote a Pink Slime Swap Meat where shoppers can trade another store’s ground beef for Fresh & Easy “slime-free” ground beef on Wednesday, March 28, while supplies last. The swap can be made for up to 2 lbs. of products.
Facing a coupon crossroads?
Ralphs is no longer doubling coupon values in its southern California stores. If this is a sign of industry actions to come—since retailers anticipate price hikes in staples and need to lessen waste in their systems—millions of coupon-toting shoppers will be upset in 2012. Stores that find ways to visibly help people stretch budgets should gain favor.
Several industry studies show how dependent shoppers have become on coupons in this persistently sluggish economy. They saved $4.6 billion with coupons in 2011, up $500 million or 12.2% over the prior year and 58.6% above the pre-recession 2007 level, said the Annual Topline U.S. Consumer Packaged Goods Coupon Facts Report from NCH Marketing Services, Inc., a Valassis company.
Boomers want healthy, customizable food experiences
Boomers planning to retire likely have more questions than answers these days. They need to resurrect their nest eggs, plan their financial streams, figure out where they want to live, be available for elderly parents and their children, and weigh the uncertainties of their own health as they age.
With so many concerns facing Boomers, it might seem that food choices and food shopping practices wouldn’t command such close attention. After all, they have a lifetime of ingrained eating habits.
Yet people seem to understand the right food choices they can afford can help sustain them to deal with life’s other challenges. Research from Canada and the United States—nations where many Boomers have similar lifestyles and life issues—reflect deliberate thinking about how they eat.
Retailers take to tablets
Doctors may say “take two tablets and call me in the morning.” Yet retailers also use tablets—to stay relevant with omni-channel shoppers, and to drive sales and their image as innovators. It’s making them better in shoppers’ eyes.
Nearly six out of ten consumers surveyed by AisleBuyer (57%) think retailers that use tablets and other mobile devices in place of cash registers are more innovative than stores without this capability. More than one-fifth of shoppers (22%) have been to a store where associates do this.
Some of those experiences likely occurred in Apple stores, where customers can be checked out by any associate on the floor, or even check themselves out with the right app and a scan.
Smartphones, hesitant users
The number of smartphones sold worldwide in 2011 for the first time exceeded the number of personal computers sold—and in a few years the number of mobile devices will dwarf the number of PCs, projected Henry Blodget, CEO, Business Insider, presenting at BI’s Ignition West: Future of Mobile Conference.
American consumers are farther ahead than the global pace in converting from dumb-phones to smartphones (46% have done so already, says Pew Research Center). The conversion cycle has just begun internationally—835 million smartphone users compare with 5.6 billion dumb-phone users, said Mary Meeker, Kleiner Perkins and Morgan Stanley. Young adults with high incomes have the highest smartphone penetration rates in the U.S., reported Nielsen.
Food Desert Study
People without access to supermarkets may have limited ability to purchase healthful foods, according to a study from the University of Georgia (UGA). The cross-sectional study examined the distribution of Supplemental Nutrition Assistance Program (SNAP) benefit accepting stores across different neighborhoods in Leon County, FL, and surveyed 73 stores, finding that store type affects the availability and price of healthful food items.
This lack of access to healthful foods in disadvantaged neighborhoods, a mounting problem across the nation, has created what are known as “food deserts”. The USDA reports that 23.5 million people live in these under-served areas.
Raising the store’s relevancy
Consumers are more engaged with their supermarket than with their bank or mobile phone provider, shows new research about attitudes toward food-store marketing.
According to the SAS UK and Cranfield School of Management study, 91% of British consumers engaged with their supermarket during a single month, either through personal experience, broadcast or word-of-mouth. This topped their 88% engagement level with banks and 82% with cellular providers.
But supermarkets have much they can do to improve, the research suggests:
Upscale grocers aren’t a win for all
If upscale grocers like Whole Foods Market help raise real estate values of the urban neighborhoods they open in, nearby property-owners gain on paper, but renters face less affordable living if pricey stores follow and an area gentrifies.
All parties have an agenda: Cities want the tax base and the better image; residents want the amenities and access to wholesome foods; the retailers want the city, state and federal incentives upfront and dense customer traffic to follow. But let’s not forget the neighborhood residents who might not be able to afford a step up, or other food sellers long committed to the area that feel they’re getting a raw deal.
Retailers grow with right use of employees
If the attitude fits, wear it.
That’s what Uniqlo, one of the world’s hottest casual-fashion retailers does. And shoppers seem to love it. So do investors—the stock price rose through the recession years and continues to climb.
Uniqlo is distinctly pro-shopper. It saturates stores with staff trained well to service shoppers better—and build transaction size and repeat visits by creating satisfying experiences. According to The New Yorker, when Uniqlo opened its Fifth Avenue store last autumn, it hired 650 people and pledged that 400 would be on duty at any one time.
