Don’t Get Too Excited About a Retailer’s Next Gen Store

This week Winn Dixie announced several ‘modern’ Winn Dixie stores inside the infrastructure of prior Lucky’s and Earth Fare supermarkets they acquired. It’s a reminder to remind YOU not to get over-excited about upgrades rapidly transforming the shopper base of downmarket retail banners. Retail shopper bases are mostly driven by a) store location and b) the quality halo of the banner built up over decades in local popular culture. Winn Dixie is a known entity as a retail brand. It is tough to change a retail brand’s image and nearly impossible to change it on a timeline quick enough to alter your own channel and banner sequencing approach for your brand.

Here’s an excerpt of how unexciting and ten-years-too-late the WInn Dixie upgades are:

“Other amenities include new seafood departments with fresh, locally caught selections, such as Florida Keys lobster, stone crab and Mayport shrimp, plus seasonal favorites like mahi mahi, grouper and triggerfish. The fresh bakery departments carry more than 15 varieties of artisan-baked breads, as well as pastries and signature desserts. The new Winn-Dixie stores also feature “LiveWell” shelf tags to help customers make healthier food choices.”

Um, no. Although I have not been inside these new stores, the description alone tells all I need to know. Winn-Dixie’s ‘new stores’ are simply take-overs of much better designed, more modern, more premium-friendly supermarket locations Lucky’s and Earth Fare were known for. These ‘updates’ are about maximizing fresh perimeter traffic, which, by default, will lead to more profitable packaged item sales. It’s a middle-market supermarket strategy, just the modern version of its execution.

But, will it change how people perceive Winn Dixie and either a) get them actually to enter a brand they’ve avoided as a low-quality grocer (i.e., vs. Publix) or b) sustain an enhanced perception of fresh perimeter quality vs. other competition (i.e., Publix, Harris Teeter)? It’s effortless to order up some PLU items tagged artisan and declare ‘upgrade,’ but shoppers who’ve become jaded about your brand do NOT change their opinion quickly at all in U.S. retail. Over time, this kind of upgrade usually does succeed, but not on the time-frame of an entrepreneur or Skate Ramp brand, which needs to plan its channel and banner sequencing based on firmly established shopper behavior today, not sometime in the future.

Don’t assume that Winn-Dixie’s chain-wide reputation among shoppers will ever change anytime soon due to this kind of slow upgrading. This process takes years. And it has failed before in brands that waited too long, unlike Kroger’s empire (where continuous improvement is part of the internal culture).

If you’d like to learn more advanced tricks on strategic planning, please take my Founder’s Quiz, and you’ll not only receive an initial diagnosis of your team’s situation, you’ll also become part of my VIP founder community. This means you’ll receive monthly white-papers as well as special e-mails twice a month designed to keep you and hour team focused on Riding the Ramp.

Dr. James Richardson

admin@premiumgrowthsolutions.com