By George Anderson
Food stores are increasingly becoming a niche business as operators have learned that the path to success lies in targeting specific core consumers instead of trying to satisfy the needs of a wider base.
"Shifting consumer behaviors and attitudes, shorter product lifecycles, new store concepts and competitive pressures from a broad range of retail formats are driving a fundamental change in the way food retail companies do business," said Michael Sansolo, senior vice president for FMI, in a released statement. "There is no longer a 'one format fits all' supermarket. Understanding the specific needs of your targeted consumers and delivering what they need are essential for success."
According to FMI's Facts About Store Development research study, stores are increasingly testing out new formats with the greatest number going the gourmet/specialty route (66.7 percent) followed by experiments with organics (50 percent) and ethnic food markets (25 percent).
For many retailers, targeting specific consumer groups means developing unique formats often within the same market. Stores are using cooking demonstrations, coffee bars, dollar aisles, gasoline, in-store pharmacies and in-store convenience areas as a means to attract and keep shoppers.
Changing a store's focus to target specific consumers has also led to numerous store remodels. According to FMI, nearly 60 percent of companies responding to its survey invested in at least one store remodel.
Moderator's Comment: What do you see as the most significant development in-store that operators are using to differentiate themselves from other food competitors? What food store operators have done a superior job in tailoring multiple types of store formats to meet the needs of targeted consumer niches? - George Anderson - Moderator