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THOUGHT LEADERSHIP

Retailers Plan New Stores, Stronger Engagement

15 May 2024

As part of their ongoing mission to help clients stay ahead of the competition in a fast-paced, constantly evolving marketplace, Mars United Commerce’s Customer Development team closely monitors the strategic activity taking place across all key retailers and channels.

Each month, the teams compile Marketplace Assessment reports on the retailers (Walmart, Target, Amazon, Kroger, Best Buy, Ulta Beauty) and channels (Regional Grocery, C-Store, Drug, Value, Pet, Club, Beauty, Home Improvement) that are most important to the business success of our clients. The following report outlines noteworthy events across six key retailers from the team’s most recent round of assessments. (To receive copies of the full reports, contact Group SVP Kandi Arrington at [email protected].)

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BJ’s Expands into New States, Sizes

BJ’s Wholesale Club continues to expand its national footprint with the opening of its first Kentucky location, in Louisville. The new club will include an accompanying gas station, which provides members with additional ways to save through both low prices at the pump and deals offered through the BJ’s Fuel Saver Program.

The retailer has disclosed a consistent store growth plan that boasts 12 new clubs this year. The plan prioritizes openings in new markets in a strategic effort to compete directly with similar clubs and value retailers in the targeted areas. BJ’s operated 243 clubs and 174 accompanying gas stations as of Feb. 3.

Relevance: BJ’s continues looking for ways to remain a key player in the club channel (along with Costco and Sam’s Club) by identifying gaps in their store footprint as well as their product assortment. The goal is to steal away shoppers by moving into neighborhoods where the competition already operates.

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ALDI Unveils Massive Expansion Plans

ALDI released ambitious plans to open 800 new stores in the U.S. by the end of 2028, including 330 locations across the Northeast and Midwest. The plan includes both organic growth in those regions and the conversion of 50 stores in the Southeast currently operating under the Winn-Dixie and Harveys Supermarket banners now that the discount retailer’s acquisition of Southeastern Grocers (SEG) has closed. Those banner changes are expected to begin in the second half of 2024. 

Relevance: ALDI’s global brand positioning as an aggressive discounter (with up to 40% savings compared to traditional groceries) continues to be relevant for U.S. shoppers, especially during the current long-term inflationary period. Due to its heavy commitment to private label, ALDI remains a disrupter in the marketplace and a potential threat to brands selling through traditional grocers that lack a differentiated offering — with SEG being a prime example. 

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Walmart Keeps Rolling Out ‘Store of the Future’

Walmart plans to renovate 12 stores in Michigan this year under a new “store of the future” concept that ultimately will be introduced to 1,400 locations across the U.S. The remodels are designed to deliver a more modern, highly connected shopping experience with benefits for both employees and shoppers. Upgrades will include:

  • Improved layouts, including more space dedicated to the growing pickup & delivery business.
  • Use of corner spaces and other areas for “vignettes” of staged products that will entice shoppers and help them experience the products.
  • Expanded product assortments across many categories.
  • A new Dollar Shop section for low-priced items. 
  • A Grab & Go section for ready-to-eat meals and snacks.
  • Express lanes for Walmart+ members.
  • Energy-efficient equipment and lighting.
  • Electric vehicle charging stations.

“Every change is thoughtful,” said Hunter Hart, SVP of Walmart Realty, “They all ladder up to a greater goal: to meet our customers wherever they are, leveraging our stores to welcome people to a more modern, highly connected Walmart.” 

Relevance: Walmart has committed $9 billion to undertake these 1,400 store renovations over the next year and a half. “In all my time at Walmart, the pace of change has never been faster — driving innovation and expecting evolution,” Hart said last fall, when the retailer hosted 117 of the grand reopenings in a single week.

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Kroger Brings Back Meal Planning 

Kroger has brought back “Meal Planning,” a section on its website that showcases seven seasonally relevant and shoppable recipes each week, along with several “30 minutes or less” options. Shoppers can sign up to receive the meal plans via email.

Along with the weekly recipes, the section contains a user-friendly recipe generator that gives shoppers other meal options based on a main ingredient and dietary preferences that they select.

Relevance: Recipes are an easy way to engage shoppers. And with new recipes offered weekly, Kroger is encouraging its shoppers to visit the website frequently. The return of this hub to the websites of Kroger’s various banners positions the grocer as a reliable destination for meal inspiration. And the shoppability of the recipes lets customers add products directly to their carts immediately after finding the meal solution they need.  

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Giant Eagle Expands DoorDashPartnership

Giant Eagle has expanded its partnership with DoorDash to make on-demand grocery delivery available through all of its 211 flagship supermarkets and Market District locations in Pennsylvania, Ohio, Maryland, and West Virginia. Giant Eagle and DoorDash first partnered in 2022 to pilot service in select Ohio stores.

Relevance: Customers now can order groceries through DoorDash for same-day delivery directly from any Giant Eagle or Market District location. The retailer’s loyalty program can be synched with the DoorDash app so members earn rewards on their orders. With same-day delivery having become table stakes for grocers, this DoorDash partnership fills a gap that will keep Giant Eagle competitive.

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7-Eleven Drives Larger Baskets with 7NOW

7-Eleven’s 7NOW delivery app is now making 3,000-plus products available for 24/7 delivery in as fast as 30 minutes. The c-store is also encouraging shoppers to add more to their orders by offering exclusive “2 For” deals on beverages and snacks. The offers are displayed via tiles in the app’s “Deals” section. Shoppers clicking on the tiles are sent to a brand page showcasing items that can be added to their carts.

Relevance: Brands willing to fund the two-fer offers at significant discounts are finding 7-Eleven’s delivery app to be a good opportunity to get into digital carts. An added bonus is the fact that 7-Eleven is allowing brands to take the lead on creative development of the tiles.

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Opportunities for Brands

As retailers continue to expand and reformat their footprints across the U.S., brands should look for opportunities to secure and support increased distribution. (Participating in and around grand opening events isn’t a bad idea, either.) And, of course, the underlying implication of these initiatives is the critical, ongoing importance of the physical store and the need for brands to continue investing in what is still the primary point of purchase as they build out their omnichannel strategies. 

In the case of private label-focused ALDI, brands should stay informed about these store openings to ensure they can deliver competitive pricing and help retailer partners retain shoppers as competition intensifies.

Elsewhere, while retailers offering meal planning inspiration and recipes is not a novel concept, it continues to be a key driver of shopper engagement and loyalty. Especially as inflationary pressures continue, meal planning also can be a great way to help shoppers save money. Brands should work with retail partners to find or create recipes that incorporate their products. 

And by updating home delivery capabilities and offers, retailers can attract new shoppers while maintaining loyalists who find themselves in a time crunch that prohibits a brick-and-mortar visit. For deal sections in a retailer app, brands should lock in early with compelling offers that will stand out against the competition and help grow baskets for the retailer. Additionally, look for opportunities for brand-led creative to increase engagement with shoppers.

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Mars United Commerce’s Customer Development practice is an unrivaled team of in-market commerce experts who simplify the complexity of retail for our clients. Located in Bentonville, Minneapolis, Cincinnati, Chicago, Tampa and the “backyards” of other key retailers, they provide deep knowledge of the retailer, expertise in key business areas (like strategy, media and creative), and door-opening personal relationships with key executives to deliver an unmatched level of business success for clients across accounts, channels and shopper engagement platforms. For more information, contact Group SVP Kandi Arrington at [email protected].

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