Target’s omnichannel Christmas
The sales momentum is expected to continue as Target during the holidays with expectations for a 3% to 4% fourth quarter same store sales increase following a hefty, and better than expected, 4.5% gain in the third quarter. Most notably, the company’s store-centric fulfillment strategy helped digital comps increase 31% with same-day fulfillment services accounting for 80% of the growth.
Another key development during the quarter saw the launch of the new 2,000 SKU Good & Gather private brand launch in the food category. Target chairman and CEO Brian Cornell said the initial response from customers has been fantastic and the brand is off to a good start.
“We think within the next year or so, Good & Gather will likely be our single largest owned brand at Target,” Cornell said. “We've already started to feature it in our weekly circular. There is some great in-store marketing in place right now. It's featured on our end caps, it's featured in our in-store marketing and it's a prominent part of our weekly circular.”
AI experts on how the technology is changing retail
It is the most talked about topic in retail and for good reason. Artificial intelligence is a transformative technology that helps retailers and brands make smarter decisions, operate more efficiently and grow sales. If you want to learn more about how AI will impact the retail industry check out this series of videos.
A new way for meal kits to make money
The Garden Incubator is the name of a new service plant-based meal kit provider Purple Carrot is making available to early-stage plant-based companies looking to scale. Together with venture capital firm Unovis Partner, funding of up to $250,000 will be made available along with services such as strategy, branding, marketing, e-commerce, operations, fulfillment and data analytics.
The strategy of helping build plant-based brands could offer greater potential than operating as a niche meal kit company, especially considering the growth challenges faced by other ship-to-home meal kit providers. Purple Carrot was apparently experiencing sales and profit challenges of its own, judging from the paltry $30 million deal it struck in May to be acquired by Oisix ra daichi Inc., a Japanese provider of produce subscriptions with annual revenues of $580 million.
Northgate Gonzalez Market expands east, adds clinic
Southern California’s leading Latino-themed supermarket has pushed east of its core Los Angeles market with a new store that contains several new features in the town of Riverside. The 42,000-sq.-ft. store occupies a former Toys “R” Us location in a sprawling area known as the Inland Empire that provide Northgate Market with new growth opportunities. It’s good to see retail real estate being put to good use by other operators rather than sitting vacant.
"Our arrival in Riverside is part of a planned expansion of our brand in key markets, and is an opportunity to offer local consumers an authentic shopping experience with customer services that will exceed everyone's expectations." said Miguel Gonzalez, co-chair of Northgate Market.
The store features a community room, a medical clinic and a wellness clinic.
Why Kohl’s is rooting for Amazon to have a successful holiday
Amazon expects its fourth quarter sales to increase 11% to 20% to a range of $80 billion to $86 billion. Mid-tier department store operator Kohl’s is one of the few retailers hoping Amazon meets or exceeds its guidance. That’s because Kohl’s accepts Amazon returns at all of its more than 1,100 stores. It is one of the most unorthodox customer acquisition strategies in retail because for it to work Kohl’s needs people to buy a lot of stuff from a major competitor, decided they don’t want it, bring the merchandise to Kohl’s to process the returns and then convert a portion of the incremental traffic generated by its acceptance of returns to Kohl’s shoppers. Kohl’s CEO Michelle Gass contends the program in place since July is working and attracting a younger customer to Kohl’s. Even so, the company was able to muster only a 0.4% third quarter comp increase and lowered its full year profit forecast.
“The entire organization is focused on delivering exceptional customer service and ensuring that we are capitalizing on increased traffic,” Gass said. “While we are pleased with the conversion rate, and it's performing consistent with our pilot stores, we are continuing to innovate and test ways to further improve productivity. A few examples include enhanced training, testing different offers and merchandising the customer service area to drive impulse purchases.”
RETAIL LEADERS ON THE MOVE
Grocery Outlet Holding Corp. named John Bachman and Mary Kay Haben to its board to enhance governance following a June 20th public stock offering. Bachman is a finance industry veteran who spent nearly 40 years with PriceWaterhouseCoopers and Haben is a CPG veteran who held senior roles at Wm. Wrigley, Jr. Company and Kraft Foods. Grocery Outlet reported a 5.8% same store sales increase in its third quarter ended Sept. 28 which prompted the company to increase its full year sales guidance to more than $2.5 billion.
Amy Kirtland, EVP of fresh and exclusive Brands at KeHE Distributors, and Lori Raya, chief merchandising and marketing officer at SpartanNash, are the newest members of the National Grocers Association (NGA) board of directors.
FreshDirect founder and former CEO Jason Ackerman was appointed to the board of directors and named executive chairman at TerrAscend Corp., a provider of products, brands and services to the global cannabinoid market. Ackerman will oversee day-to-day operations from the Mississaga, Ontario-based company’s New York office as it builds its U.S. leadership team.
Retired Kellog Co. executive Dave Jones received NGA’s Industry Service Leadership Award for his work during a 33 year career at the CPG company where he served as VP of industry initiatives since 2009.
Kimberly-Clark CEO Michael Hsu will assumed the additional role of chairman on Jan. 1, 2020, filling a position held by Thomas Falk who is retiring after serving as chairman for the past 16 years.
Mike Ryan was named SVP of Science at Revionics. He previously led the data science, engineering and cloud platform teams as RetailMeNot. He also spent time with TicketNetwork and ESPN and brings experience in end-to-end development of large-scale machine learning systems to Revionics, a provider of pricing and promotion optimization solutions.
Jenny Condon was named SVP of e-commerce at Label Insight, a provider of product attribute data that enables e-commerce and product transparency. The firm combines package data on more than 80% of top-selling food, pet, and personal care items with data science and machine learning to create more than 24,000 attributes per product.
Retail Leader parent company EnsembleIQ named B2B media executive Joe Territo to the newly created role of SVP of content overseeing cross-platform content strategy and new product development. EIQ’s chief innovation officer, Tanner Van Dusen, was given added responsibility as managing director of the Path to Purchase Institute (P2PI) and tasked with driving growth for the membership-based organization.
“Joe’s industry experience and expertise make him a natural fit to lead the charge in expanding EIQ’s digital footprint and driving its content innovation to meet the evolving needs of the marketplace,” said Jennifer Litterick, CEO at EnsembleIQ. “We believe Tanner is uniquely qualified to take on this role given the depth and breadth of her experience across EIQ as well as her demonstrated creativity, strategic thinking and leadership skills.”
IN CASE YOU MISSED IT
Digital food retailing webinar transcript available
Retail Leader hosted a webinar recently on digital food retailing in which IDC Retail Insights and Precima shared exclusive research valuable perspective on where the market is headed. A transcript of the live event is available for download here.
Make pet food great again
Nestlé Purina PetCare Company invested $320 million to convert a long-idled textile plant in Hartwell, GA., into the company’s 21st pet food factory. It is Purina's first new U.S. factory in two decades and represents Nestlé's single largest investment in a pet care facility in the last decade in North America.
A holiday to remember for all the wrong reasons
Sears and Kmart released a list of Thanksgiving weekend door-buster deals, but there are fewer doors to bust. The company’s store base continues to shrink and on Nov. 7, the company announced plans to begin going-out-of-business sales at 96 stores, which once completed, will leave the company with a total of 182 locations, 112 Sears and 70 Kmart stores, and facing the prospect that 2019 could be the final holiday season for its physical presence based on the trajectory of the business.
Growth oriented retailers looking to expand their physical presence in 2020 will want to check out soon-to-be-available Sears and Kmart locations.
A green bean casserole for the ages
B&G Foods Green Giant brand shattered its own Guinness World Records for the title of largest green bean casserole. The colossal side dish weighed 1,009 pounds, compared to the prior record of 637 pounds Green Giant established in 2017, and contained 1,069 cans of green beans, 485 cans of mushroom soup, 95 pounds of French fried onions and more than 16 gallons of milk. The casserole was served to 3,000 older New Yorkers through Citymeals on Wheels.