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Grocery stores changing as customers demand online shopping, convenience

Falcon News Service

April 11, 2017

The way people are now grocery shopping is forcing the region’s retailers to try new things.

The internet made it easy for people to buy books, clothes and tools. The latest trend in online shopping is groceries.

Amazon.com makes it easy to buy goods that don’t spoil easily, such as cereal or laundry soap, but it can’t ship fresh produce—yet. However, local grocery stores can.

Stores can have groceries ready for pick up or delivered directly to door steps soon after a customer places an order using a website or mobile application.

“We don’t have many people using the grocery shopping app yet, but I think it will be growing in the future,” said Dawn Kobs, assistant manager at Family Fresh Market in River Falls.

People can now shop from home and drive over to pick up groceries at the store without even getting out of their car.

Family Fresh has partnered with My Web Grocer. Ordering is easy and after a confirmation is received, staff will do the grocery shopping and have the groceries ready when the customer arrives at the store. They bring the groceries out to the customer’s car.

According to the Food Marketing Institute (FMI), over the last year, more customers are using apps to help them shop, save money and even have grocery stores help them eat healthier.

“The most popular items are definitely our fresh produce and grab and go items,” said Terri Bennis, vice president of perishable food operations at Twin Cities-based Kowalski’s Markets.

What shoppers are looking for has been changing rapidly over the last two years.

According to FMI, more shoppers are not as loyal to one grocery store chain as they have been over time. Two-thirds of all shoppers are likely to bypass stores closest to them for stores that offer lower prices, but are farther away.

FMI also found that it’s millennials who like to shop online. Online retailers are contributing to grocery channel fragmentation, which is driven by millennials, according to FMI’s annual report.

Not only are online stores competing for shoppers, but so are newer smaller grocery stores, such as Aldi and Trader Joe’s.

Aldi serves more than 40 million customers each month in 35 states. Locally, Aldi has stores in Hudson, Stillwater and now in New Richmond, which opened in December.

“We are pleased to bring our first store to New Richmond to help customers get high-quality products at everyday low prices,” Matt Lilla, Faribault division vice president for Aldi, said in an interview with the New Richmond News. “We challenge shoppers to switch from national brands to our high-quality exclusive brands and save up to 50 percent without compromising. As important as price is, the only way to attract and keep shoppers is to have quality products.”

Recently, Aldi announced plans to invest $1.6 billion into remodeling its stores. The new designs are based off of customers’ desire for more focus on fresh foods and more produce.
Meanwhile, high-end grocery stores are meeting customers’ demands with new and trendy fast food items that have a home-cooked feel. They are also remodeling the bigger stores to have stores within stores.

“We have redesigned our stores to fit the way shoppers shop. People really want easy meals,” said Bennis of Kowalski’s. The stores are being redesigned to fit customers’ buying patterns.

“We are seeing a big shift in convenience,” said Bennis. People want their food chopped or prepared so it is ready to cook when they arrive home.

Another new concept in grocery shopping is fresh restaurant-style quality foods on the spot.

Four of Kowalski’s stores now have a pasta program that offers fresh food made fast. People get to choose what kind they want in pasta, meats and fresh vegetables. Then, the dish is cooked within 3-5 minutes right in front of them.

“The digital era has really changed how we shop,” Bennis said. “I’ve been in the food industry longer than I would like to admit, and just when you think you have it figured out, it all changes.”

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