In this age of tech innovation, the grocery marketplace isn’t letting itself get left behind. Major chains like Whole Goods and Kroger are radically reshaping their store design and marketing strategies to appeal to a new generation. The next time you step into your local supermarket, you may notice some key differences. The factors driving change are: Demand for Lower Prices For a long time, consumers have let food sellers slide when it comes to price-setting. We need food to live, so we open up the wallet and pay the ever-rising price for a gallon of milk, even if we do so grumbling. But buyers aren’t going to take it anymore. Consumers are becoming aware of markets’ deceptive practices and demanding changes—or they’ll take their business elsewhere. Price-gouging in the food market is a hot topic of late due to the highly publicized Whole Foods case. A New York City probe into the Texas-based food chain found that the store was understating the weight of its packaged products in order to charge more for them. During the investigation, inspectors took a look at 80 different types of food items and discovered that all of them were inaccurately labeled. In some instances, customers were paying over four dollars more than they should have been given the per-pound price. Naturally, all hell broke loose on Social Media, with consumers venting their disappointment with the trusted brand and threatening to boycott. The scandal certainly took its tole on the company, with shares diving over 35%. People want lower prices, which makes sense considering how farming and processing technologies are making food production more efficient. To deliver on the expectation of lowering prices, food sellers are taking more innovative measures. American stores are going to have to fight harder to be competitive with new competition from German discount markets Aldi and Lidl, which specialize in cheap food and non-food retail. Automating the Buying Process Stores across the country are implementing self-checkout. The number of stores using self-checkout is growing at a fast rate. Self-checkout machines provides shorter waits for customers with few items, and they prove to be good investments for store owners, reducing staff needs and recovering their cost very quickly. Aldi and Lidl of Germany use self-checkout as one of their ways of keeping prices low; American chains would do well to catch-up. Sale of Organic Products Consumers, especially the younger generation, are becoming ever more interested in organic foods. Food stores are partnering with local providers to offer customers quality products. Whole Foods, wanting to recover its reputation after the price-gouging fiasco, is creating a new line of millennial-targeted stores called 365 by Whole Foods Market. These stores are to have a modern look and feel, along with a wide selection of hand-picked organic and natural foods. The food wars are just getting started. Consumer choices are growing, and the field is about to be shaken up with the introduction of Aldi and Lidl. The giants of food retail are going to have to make creative changes if they want to keep from getting left behind in the dust.
Major Shifts Taking Place in the Food Marketplace