2014 Leading Retailers: Some Things Never Change

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2014 Leading Retailers: Some Things Never Change

By Harry Stagnito - 11/01/2014

This 2015 Leading Retailers issue highlights specific reasons and innovations that have garnered these premier companies well-earned recognition. And the Special Trends section covers the course of direction all businesses will need to perform to experience leading–edge growth.

But to predict the future, let's take a look at a recent historical forecast to see how we assessed the industry 15 years ago. The following information was extracted from Progressive Grocer's 68th Annual Report of the Grocery Industry, published in 2000.

Here is a comparison of the Top 10 Supermarket companies listed at that time, compared with the Top 10 in 2014.
2000
 
2014
 Rank
Company
 Rank
Company
1.
Kroger
1.
Walmart
2.
Albertson's
2.
Kroger
3.
Safeway
3.
Target
4.
Walmart
4.
Safeway
5.
Ahold USA
5.
Publix
6.
Food Lion
6.
Ahold USA
7.
Winn-Dixie
7.
AB Acquisition
8.
Publix
8.
H-E-B
9.
A&P
9.
Delhaize America
10.
Supervalu
10.
Meijer

Half of the companies that made up the top 10 in 2014 weren't on the top 10 list in 2000. The major reasons were consolidations, mergers and acquisitions. If you were to continue on the list and analyze the second 20 companies, you would discover a major rise in retailers specializing in unique product positioning, regionalization and pronounced store brands offerings.

The concepts providing the greatest return have been in the areas of the best shopper marketing programs; best use of digital, mobile, and social networking platforms; innovative category management and merchandising strategies; and company branding.

While reading about this year's Leading Retailers, you'll see specific examples of these practices at work. Market-driven branding might be the most important function affecting retailer growth because it triggers the critical psychological and emotional cues in the minds of shoppers–a point of difference.

To gain the status of being "market-driven," the company has to engage its customers, and truly listen to their needs (big data). Applying a market-driven approach demands commitment and discipline because it's a procedural approach. An informal work culture and loose organizational structure fails at applying this methodology because of the time involved in executing all phases of this process. Market-driven products help establish market leadership and revenue growth potential.

What ultimately prevails is the understanding that product value is determined by the customer–not by the company or its technology. That's where branding comes in.

Back to the 2000 Annual Report. These were the Top 10 challenges confronting retailers at that time:

  1. Difficulty in retaining employees
  2. Difficulty in recruiting good new employees
  3. Competition from non-supermarkets
  4. Manufacturer consolidation
  5. Use of internet in B-to-B communication
  6. Retailer consolidation
  7. Business going to supercenters
  8. Difficulty in maintaining the current profit margin
  9. Better systems for using consumer data
  10. Collaboration with trading partners

And, if I were to include the next 15 concerns, you would arrive at the same conclusion that I have: Not a whole lot has changed.





– Harry Stagnito,

President and CEO,
Stagnito Business Information