By Lori Sichtermann
Through special arrangement, we offer this excerpt from PLBuyer's recent cover article for discussion on RetailWire. Click to view the entire article, Three Sizes Fit All.
You can't be all things to all people. That was the lesson learned by Food Lion when it spoke to shoppers at its 1,200 or so stores in 11 states along the Atlantic coast.
What Food Lion could be was more responsive to the needs of individual consumers in specific markets and that was the motivating factor behind the company's decision to launch three separate banners - Food Lion, Bloom, Bottom Dollar Foods - each with a specific niche to fill.
"Some customers might be looking for a novel experience, some may just want to save money, and others may want their traditional, neighborhood Food Lion store. Where other stores may try to cram all these customer desires into one store, we decided that the best thing to do was diversify and have a multi-banner strategy," said Kimberly Blackburn, corporate communications manager for Food Lion LLC.
Food Lion
The future of the flagship Food Lion banner can be found in Lyman, S.C. As part of its research effort, Food Lion found that, while many consumers go to supercenters, they don't necessarily prefer to shop in the behemoth stores.
The store in Lyman is a first for Food Lion. The 35,000-square-foot store does away with the box-like design found littering the retail landscape. The entrance has a gabbled roof, making the store more home-like and welcoming. Inside, customers are greeted by fresh produce located in a setting that resembles an outdoor farmer's market. The store's design is spacious, organized and simple, featuring a unique layout that enables one section to flow smoothly into the next.
"We gave some serious thought into how to group items," said Jeff Lowrance, corporate communications manager for Food Lion LLC. "If a customer's coming in to pick up a few things for tonight's dinner, we wanted to have wine and natural products close to produce, meats and deli-bakery. We wanted to group all that together so as to make it easier for customers when they come in to shop."
Fresh departments are given special emphasis along the right side of the store, beginning with produce, then leading to the deli-bakery and reaching the back of the store with the fresh meats. However, as the sections merge into one another, each holds prominent the well-identified Food Lion brand of products, which includes approximately 2,900 types of food and non-food items.
The company is very focused on developing new products in its private label along with a number of exclusive brands it sells.
"The launch of Butcher's Brand Premium Beef has positioned our beef business in a very positive way," said Pete Bonneau, leader of private label for Delhaize Group U.S. "Butcher's Brand has helped to reposition folks' perception of Food Lion within the meat business."
Another success story is Food Lion's Braidenwood Estates wine. First introduced last year, ACNielsen named it the top selling branded wine in an 11.25-ounce bottle.
"Quality is not debated," said Mr. Bonneau. "We're not here to make private brand products to lessen our image of quality with the product. It's more about looking at the products that are out there; it's about asking if there's enough volume to support another brand in the category. That's really the decision tree we use."
Bloom
Similar in layout to the store in Lyman, S.C., is the 38,000 square-foot Bloom prototype. It carries many of the same items as Food Lion but distinguishes itself with a chic ambiance featuring inset lighting behind produce shelving units that casts wave-like shadows on the wall as well as the sound of a running stream piped into the produce area.
"Bloom has everything from the routine to the exotic, we even sell sugar cane," said Karen Peterson, media relations for Bloom. "You can find items here that you typically wouldn't be able to find anywhere else. It's like a specialty store with traditional grocery store pricing."
On the tech front, Bloom offers shoppers hand-held scanners so they can scan items as they move through the store. Stores also offer shoppers self-checkout stations and even mobile registers. The mobile registers are used to alleviate long lines and lost time for shoppers. These registered are outfitted with wireless checkout features, and can be used to expedite checkout in many areas of the store, inside and out.
Bloom is all about convenience, quality and service, said Ms. Peterson. "Customers don't have to use the technology that's in place in each of the Bloom stores, but it's there as an option for those who want that kind of shopping experience."
Bottom Dollar Food
The Bottom Dollar Food banner means combining elements of a traditional grocery store, convenience store and dollar store under one roof with extreme value pricing.
The division's 15 stores are not your typical bare bones limited assortment store environments. Walls are splashed with bright green and neon orange paint and cheerful music is piped in throughout the store.
Unlike typical discount stores, Bottom Dollar Food features a sizeable fresh produce section and an on-site butcher who can cut-to-order meats for customers.
The store is able to deeply discount items because it saves by displaying product on palates and in boxes on the shelf. Customers purchase or bring their own bags to the store and also do their own bagging.
Discussion Questions: How will the combination of the three formats affect Food Lion's competitive position? What formats do you believe Food Lion will emphasize for new store openings to reach its sales objectives?
Food Lion is not currently operating all three concepts within a given market but it does have plans to do just that, according to PLBuyer.
We're not sure that Food Lion has found a compelling point of difference for the Food Lion format as of yet. From the reports we've received, the Food Lion stores are still mostly of the plain vanilla variety with remodeled units being described as little more than a slightly less upscale version of Bloom without any of the technological advances of the newer concept. - George Anderson