Supermarkets on Tap
By Tom Ryan
Both Wegmans and Whole
Foods have recently opened pubs inside stores in Pennsylvania, serving
beer, wine and drinks.
Wegmans’ establishment,
called The Pub, was part of the opening of its store in Collegeville, Pa.,
and is the only such establishment among its 75 stores. A second Pub is
scheduled to open in June at Wegmans’ store in Malvern, Pa. Whole Foods
opened its Cold Point Pub at its store in Plymouth Meeting, Pa. on January
12. Both pubs are only open during store hours.
Each grocer is approaching
the opportunity differently. Pennsylvania’s South Bend Tribune describes
Whole Foods’ 28-seat Cold Point Pub as "more like a coffee lounge" with
soft lighting and easy chairs. Only beer and wine are sold. Consumers serve
themselves wine from preset taps after paying for an access card. Employees
run the beer taps. Food at the establishment includes charcuterie plate,
an olive sampler and soft pretzels but customers are invited to buy something
in the store to bring into the area.
Wegmans’ 63-seat pub is
more like a traditional bar/restaurant with spirits included as well as
two-flat screen TVs for sporting events. The bar top features "Cambria
natural quartz stone, surrounded by solid cherry and cherry veneers," according
to South Bend Tribune.
Speaking to the newspaper,
Kathy Haines, Wegmans’ regional restaurant manager for Pennsylvania, said
the The Pub represents an extension of the store’s Market Café food court,
where shoppers can buy prepared foods to eat at tables or for takeout.
The Pub is a full-service restaurant “where you can enjoy a great meal
and enjoy a drink with that meal,” although she said “our focus is really
on the food.”
Indeed, monthly pub sales
so far show that only 20 percent of patrons order an alcohol beverage with
their food order.
The article speculated
that the number of mothers pushing strollers during the day was one reason
many patrons were opting not to order an alcoholic drink. One 76-year grandmother
visiting the area decided not to get a drink because she had to cook that
night and help her grandkids with homework.
But her 75-year old husband
hoped the idea would reach his store back in Pittsburgh. One 33-year old
also welcomed the idea, but said he "wouldn’t want to get drunk in front
of families." He also joked that it appeared to be a good marketing scheme. He
said, "You come in and have a couple of cocktails, and then you buy all
sorts of things you didn’t come in for.”
Discussion
Questions: What do you think of the idea of pubs in supermarkets? Does
it take a Wegmans or Whole Foods to pull it off or is this something
most grocers could handle?
It sounds like a cafe that serves beer and wine; hardly a pub where Norm and Cliff would come each night. Incremental sales might be achieved but if the patrons didn’t order beer and wine, what’s the point other than PR?
What would make this idea exciting is if stores sales (outside of the alcoholic beverages they are serving) increased as a result of the pub. If they are getting more shoppers buying the food (charcuterie, olives, etc.) to take home after trying them at the pub, it’s a great idea. If they are just adding a bar to a grocery store, they should have better things to focus on.
This is a great idea but will will take a Whole Foods or Wegmans to pull it off. The store needs to be a destination format where people are already going to enjoy food and relaxation. Some stores have put in coffee shops with free WiFi and newspapers. Why not offer the same services with beer in a comfortable smoke-free environment? Some of the newer movie cinemas now offer this.
Pubs and restaurants in supermarkets should be viewed in a marketing versus sales context. In other words, do these foodservice operations reinforce the perception and positioning of the food retailer in the minds of the target market? In the case of Wegmans and Whole Foods, the answer appears to be a resounding “yes.”
As for other supermarkets considering such an idea, I would add the caveat of making the necessary commitment to such an adventure. Years ago, during the HMR craze, most supermarkets attempted to add meals. With the exception of Ukrops, who made a real commitment to “convenient meal solutions,” most supermarkets failed in this endeavor. Assuming foodservice fits the supermarket strategy and can be successfully executed than this is something that should seriously be considered.
At the Whole Foods store around the corner from my home, they started serving beer and wine in their seated eating area about a year ago. From all indications, it’s going very well. While it’s certainly not a pub-like atmosphere, many customers seem to enjoy the chance to have a drink. It only makes sense, doesn’t it?
Go to Europe and see how society isn’t afraid of alcohol, doesn’t demonize it, and views it as part of a ‘civilized’ existence. This has nothing to do with abusing alcohol. It’s merely part of creating a better experience for your customers. One that has them stay longer in your store…and probably buy more too. If putting in a coffee stand works to drive up frequency of shops and average basket values, can you imagine what a couple of beer taps might do?
Interesting to note that both of these stores are in PA–a state which has very unusual regulations regarding the sale of alcoholic beverages. While the brief discussion didn’t mention it, the articles did point out that by opening the cafe/pub, both chains got the right to sell beer for takeout–something that they could not do before. I suspect that is the real reason behind the offer.
Whole Foods in Pasadena, CA has been serving food, beer and wine for some time. Our local HOWS market has a wine bar. I’m not sure how much difference this makes to shoppers. It does give the store a nice ambiance, but I don’t see it encouraging sales or making the store a destination.
I’m struggling with this. Most people shop during the day. So are we encouraging people to drink during mid-day and then get in their cars and go back home? Or, is this just a separate business they are going into to extend profits. The point about state-owned liquor stores in previous comment is also noted. However, I know as a shopper, I would find this somewhere between off-putting and bizarre.
I agree with David Livingston–it’ll take an upscale grocer or say, “purveyor of fine food” to pull it off. Price point and environment will be the keys to creating a successful image and experience. Otherwise, it may just project an image of nipping the bottle at 2pm.
The rational arguments presented for the concept here are, well … rational. But somehow I just can’t see popping over to the Jewel for a jigger of gin!
Our Whole Foods stores here in Chicago do have very appealing in-store seating and dining, and I’m as prone as the next fella to having a chardonnay with my sushi at lunch. But somehow I still don’t see the appeal of having a relaxing meal experience in the midst of shopping carts and “price check on aisle seven.”
My first thought is, what in the world took so long? Any trip to a European culinary emporium like Harrods in London or KaDeWe in Berlin will have you shopping around folks stationed at a seemingly endless array of themed food and/or booze stations. No matter what time of the day, they’ll be happily dining on breakfast, lunch or dinner, accompanied by a brew, cocktail, glass of champagne or wine.
Why are we in the U.S. so uptight about that sort of thing? Thanks for getting the ball rolling, Wegmans and Whole Foods!
P.S. What is it about Pennsylvania that is making the go-to launch market (first Target, now Whole Foods and Wegmans)?
This sounds like something you could do once you’ve established the appeal of in-store dining. Which likely comes after take-away home meal replacement. Beyond Wegmans and Whole Foods, how many supermarkets have done those things effectively? Seems like that’s the right start.
I have never worked in the booze industry but I have many friends and colleagues that have worked their way through university and college by being a server at a bar. I’ve heard horror stories of patrons getting blind drunk and tearing up the place. Is that something to expect at your local Wegmans or Whole Foods? Doesn’t this seem like a little off the mark in terms of marketing focus?
The Retail Doc is right in the sense that booze can bring in good margin but if it’s not performing, why bother with the potential liability with serving alcohol?
Although the thought is interesting at first, I am not sure this is a direction retailers will want to take for several reasons.
1) Do one thing and do it really well. Can a grocer really run a pub as well as someone that does it full time? Think about a pub opening a grocery store.
2) Will people shopping for food and picking up prescriptions really be tempted to stop into the pub for a quick drink?
3) Destination – Is a pub located inside a grocery store truly going to be a destination for people who want to have drinks with friends or watch a sporting event?
4) Liability – I am not in the insurance industry, but I have to believe this would drive up the cost of liability insurance.
Do one thing and do it better than everyone else. Creating a stronger in-store cafe that serves healthy salads and great entrees is a much better direction, in my opinion. On a recent visit to Hy-Vee, I was really impressed by their in-Store cafe. The quality of the food was very good and is clearly what drove consumers to purchase. Not to mention a fair price and lots of great options.
I am a lover of out-of-the-box thinking, but this one is tough for me to get my arms around.
Hmm, lemme see.
“Honey, meet me at Whole Foods (or Wegmans).” Yup.
“Honey, meet me at Kroger.” Nope.
Whole Foods gets drama and theater, their stores are a natural for an engaging pub-like (bistro, sushi-bar) experience; and I’ve never been in a Wegmans that wasn’t a buzz of energy (albeit very different.)
Grocery is about procurement for most, it’s not about lingering and hanging out. This of course, is why stores Whole Foods and Wegmans get so much attention–from observers and competitors.
These are very carefully crafted evolved environments. The fertile ground they have cultivated allows them to do innovative (not sure how innovative a pub in a grocery is) deeply experiential experiments like this.
Ever been to a Whole Foods on Friday after work? Now that’s an experience.
We always say that the number one law of retail is Murphy’s Law, so, I just can’t help but think: underage drinking, intoxicated customers, outrageous behavior, messes we don’t want to discuss here, etc, etc. Now, don’t get me wrong, I’ve been to many of the Whole Foods wine tasters on Friday nights, but I believe what we’re talking about is transferring the successful elements of events like that to a mass level…and that’s where you lose me.
It’s a great idea for some grocers, it’s a bad idea for all grocers.
The only comment that seems missing is how alcohol fits into the brand promise.
A glass of Merlot at Wegmans–seems to work.
A double Jack Black with a beer back at Whole Foods–I have a little more trouble with that.
Great idea for marketing the store–really ties in to the potential for localization, another reason to shop in the community. As all have commented, depends on the chain and target shoppers. Making shopping fun is not a bad idea!
Several thoughts occur to me here. First off, boys with toys. Is this another way of creating a creche for the guys who need to be kept out of trouble while the girls do the shopping? Are they allowed to take the kids in with them? If not, then this is not a way to attract families, either, for a relaxing meal and drink to go with the hassle of shopping.
Secondly, assuming that most (if not all) customers have arrived by car, isn’t it just a little bit unethical to encourage them to have a drink?
Thirdly, do non-drinking customers really want the drinkers careering around the aisles in charge of shopping carts? Whatever would the health and safety execs have to say about that?
And finally, what kind of message does this send to families shopping with children? Or to teenagers who should be taught about responsible drinking?
The whole idea strikes me as dumb to put it mildly. Almost as dumb (or maybe even dumber) than encouraging sick people to come to grocery stores and spread their germs while waiting to see a “health care assistant.”
As for the references to Europeans and their attitude towards alcohol–first off, I’ve never seen a grocery store with a pub. Harrods et al are department stores that happen to have food offerings. And binge drinking is a major problem with lots of so-far unsuccessful attempts to reduce the sale of cheap alcohol and promotions. The thought of binge drinkers on grocery premises is highly unattractive.
I think a good way to look at this would be as a logical brand extension, from strictly unprepared foods > prepared (take out) foods > restaurant. A number of respondents have noted that Americans are relatively prudish–and some of the other comments here have seemed to validate that point–and so this could only work with (presumably) sophisticated retailers; which means, I assume, that $1 beer nights are not something we will be seeing soon at Walmart.
Great A&P started expanding its Best Cellar wine bars last year, and could easily extend the concept to SuperFresh locations in PA.
Fine food and fine alcoholic beverages definitely have a place in a supermarket setting. There are so many fresh markets around the country where these pubs would do fantastic business.
First it was in-store coffee bars. Now we are seeing operators move into the next phase of rollouts.
Innovation always starts with taking risks. Serving beer and wine at sit-down, in-store restaurants is another innovation that will seem common in the next ten years.
I would LOVE to be able to have a nice glass (bottle) of wine while I am shopping. That would take the edge off for sure. GREAT IDEA. How does the “open container” piece work?
One of our clients, Tony’s Markets here in Denver, opened a Bistro in their newest store located near downtown. Around since 1978, Tony’s is a gourmet grocery known for outstanding meats and customer service. The Bistro is casual dining style and serves beer and wine only. It has served nicely for the bottom line, as well as introducing downtown (i.e. lunch) clients to the grocer in general. Their other stores are located in the suburbs, so many urban folks weren’t aware of the grocer.
It works for them – with the gourmet feel, a glass of wine at lunch, then picking up a few steaks for dinner just makes sense.
Marketers are always stretching to find the next best thing. Incremental sales and wallet share are the goals of most grocery related initiatives and, although I have reservations of the grocery pub concept, it does serve the objectives.
In my view, Wegmans has the most engaging grocery footprint that I have visited. Harris Teeter in Virginia has a similar layout, but lacks a touch of warmth that Wegmans delivers so well.
I suppose that extending the drink menu within an existing cafe format to include beer and wine would attract a wider array of patrons and give some an excuse to make the purveyor their preferred store.
I would move ever so carefully, however, so as not to damage the brand value that these chains have established. One patron having an incident with their car after leaving the pub would be a disaster not worthy of an experiment to gain a bit more wallet share.