Retail Intimacy, Part 14: Winning at Meijer

It is not easy these days for any U.S. grocery retailer to keep a low profile. Yet, for much of its 81-year history, Meijer has been able to fly under the radar. As a private, family-owned company (now run by president Rick Keyes, a longtime Meijer employee), Meijer’s slow-but-steady growth trajectory and shopper-centric strategies are not beholden to Wall Street’s demands or subject to the constant glare of the media. The Grand Rapids, Michigan-based supermarket chain, which operates 222 locations in the Upper Midwest and Great Lakes regions, plans to open 10-12 new stores per year over the next few years, including in new markets in Wisconsin, according to Kantar Retail.Thanks to a successful formula that includes its widely recognized name, strong supply chain and loyal customer base, Meijer was named Progressive Grocer’s 2015 Retailer of the Year.“Meijer has done well by hitting the sweet spot between quality and value,” says Jim Hertel, managing partner at Willard Bishop, a Chicago-based consultancy that specializes in grocery. Hertel says that Meijer is well-positioned to compete with larger retailers by leveraging its supercenters, which carry both hard and soft goods, as shoppers across the economic spectrum demand better quality and a wider selection of products. “Meijer’s customers believe they don’t have to compromise on quality to be rewarded with low prices,” he says.“Every program must be rooted in strong insights based on Meijer shopper data, and show that both single-brand and partner events benefit the Meijer shopper.”— Jessica Malin, CatapultMeijer tends to be fairly conservative with regard to marketing and merchandising at its stores. However, brands can break through by crafting programs that communicate Meijer’s value proposition while addressing a clear shopper need. Marketers who regularly work with Meijer describe the retailer as an active partner, one who is open to new ideas. “Meijer has very strict display standards and is very careful with shopper messaging at stores. But [their executives] are also a very engaged team, and they are always willing to collaborate and partner with us,” says Analia Benedetti, director of shopper marketing at Kellogg Co. (See Meijer Display Gallery.)When brands approach Meijer with program ideas, they should do so early in the creative process, says Benedetti. “Bring them key insights and reasons to believe,” she says. “Circle back to them with post-event analysis. Repeating their circle, learning from experience and improving your programs based on learnings is the way to drive both positive results and partnership.”Those are useful takeaways for all potential Meijer partners, adds Jessica Malin, Meijer team lead at Catapult. “Every program must be rooted in strong insights based on Meijer shopper data, and show that both single-brand and partner events benefit the Meijer shopper,” she says. “Tying those benefits back to household penetration, market share and category growth will further strengthen the manufacturer’s relationships with Meijer.”Speed to MarketAs with most major retailers, Meijer’s shopper marketing programs go through a lengthy development process before brands may begin activating at its stores. However, if a solution is strong enough, it can break through quickly – in some cases, within a matter of weeks. That’s exactly what happened when ConAgra Foods partnered with Meijer on a 2015 “Summer Value” program, which provided snack/meal ideas and savings offers for budget-constrained shoppers and required only six weeks from initial concept to in-store execution.The idea for the program came about during a grocery innovation meeting in April between ConAgra’s and Meijer’s marketing and merchandising teams. “We presented our top 10 discoveries from our research and insights group, and the one that kept rising to the top concerned a [seasonal] budgetary issue for lower-income families,” says Mike Esposito, shopper marketing manager at ConAgra.In the summer, many families with children in public schools no longer had their breakfast and lunch provided by the schools, particularly in some of Meijer’s top markets, Esposito explains. “Their moms and dads were often both working, and the kids were not necessarily old enough or able to cook a full meal on the stovetop,” he says. “They needed quick, easy options that they could microwave or grab and go.”ConAgra worked with Meijer to identify brands that over-indexed with Meijer’s shoppers and would provide a good fit for the program. (It also involved other vendors, including General Mills.) As the solution’s centerpiece, endcap displays featured several of ConAgra’s convenience products, including Snack Pack pudding cups and Chef Boyardee microwaveable meals. “The idea was to create a destination that would appeal to a broad range of Meijer shoppers, with creative that focused on the value component,” notes Esposito. He attributes his team’s ability to translate insight into action to the program’s solid research foundation and early engagement among the brand and shopper teams.“Meijer had a seat at the table early on during our focus groups starting in January. [Their executives] were able to ask direct questions of participants on issues that concerned their shoppers,” Esposito says. “Meijer is a trusted partner who sees the value in a clear and straightforward solution.”Breaking New GroundDuring the back-to-school season, when so many retailers are vying for similar trips, marketers must be able to craft value-oriented programs with a compelling point of differentiation. Increasingly, Meijer is looking to its brand partners for back-to-school programs that can increase trip size and decrease the overall number of trips, while positioning the retailer as a primary destination for grocery items and school supplies.Consider the 2015 “Fuel Your Creativity” program, whose marketing partners – Kellogg and Crayola – share a high brand affinity among Meijer shoppers. For Crayola, the partnership was an opportunity to gain display and break new ground with high visibility in the center store. During the month-long promotion, Meijer’s center-aisle gondolas merchandised Crayola crayons, pencils and coloring books alongside Kellogg breakfast items, with headers advertising a “Buy $15/Save $5” offer on eligible products.Back in March, Crayola had provided a critical insight around which to build the program. In the last couple years, the company’s internal sales data revealed growing volumes toward the end of the traditional back-to-school season. Kellogg and Crayola presented the data to Meijer as a rationale to leverage the extended season in a unique way.“There’s a third micro-season we’re seeing well past Labor Day. Teachers are putting additional school supplies on the list and moms realize they may have forgotten something or need to stock up,” says Mimi Dixon, team leader, shopper engagement and activation at Crayola. When Kellogg was presented as a marketing partner, Dixon says the program (which ran from Labor Day through early October, with merchandising in the middle two weeks) became a no-brainer. “The partnership has to make sense to shoppers very quickly, and this one does. Kellogg provides the fuel of nutrition, while Crayola inspires creativity,” she says.Additional marketing components played off the “Fuel Your Creativity” theme. In-store floor graphics and circular ads promoted the offer, while a sweepstakes presented shoppers with a chance to win Meijer gift cards of up to $1,000 or a grand-prize trip for four to Disney World and the newly opened Crayola Experience. Shoppers could enter the sweeps through Meijer’s social media outlets and download customized coloring pages on a promotional web page within meijer.com.“As we continue to build our shopper marketing function at Crayola, ‘Fuel Your Creativity’ was an excellent example of what can be done with an actively engaged retail team, a great marketing partner and a shopper-savvy retailer,” says Dixon.Emerging OmnichannelAs a regional supermarket with a long history of community partnerships, Meijer knows the preferences of its customers – perhaps as well as any retailer. However, the challenge for Meijer is to continue to leverage that knowledge as it expands its reach through omnichannel marketing.Over the past year, signs of progress have emerged on the omnichannel front. Meijer recently expanded a pilot program for its “Click and Collect” free curbside delivery service at one of its flagship Michigan stores, where a new dedicated pick-up window will allow customers to retrieve their online orders without leaving their cars. Meijer has also moved its cardless mPerks loyalty program online and outfitted all of its locations with Wi-Fi so that customers can access information regarding deals while shopping in stores via their mobile phones.Meijer’s mobile-enabled mPerks program promises to give the retailer a wealth of new customer data. Shoppers can now view their receipts and track monthly/annual savings on a dedicated portal at meijer.com, as well as create shopping lists and download coupons to their phones for redemption at checkout. Meijer offers “personalized” rewards that shoppers can select in their preferred product categories, and digital coupon offers are increasingly based on past purchase behavior.“The newest enhancements to Meijer’s digital loyalty program match the efficiency of [larger competitors], though Meijer shoppers have to filter for relevant deals whereas [other retailers] offer relevant/personalized deals upfront plus browsing capabilities,” says Alida Corcoran, senior analyst at Kantar Retail. “If you frequent Meijer often enough and it captures enough data, digital deals match purchase history.”When the revamped mPerks program first rolled out in mid-2013, Corcoran notes, usage was low. “That made it challenging for both Meijer and its suppliers to analyze data and leverage it effectively,” she says. “But things have picked up lately. We’re starting to see evidence of stronger omnichannel retailing. Meijer has done a better job of bridging the gap between its website and the stores.”Putting It All TogetherAs Meijer continues to grow its digital toolkit, marketers may create new opportunities to adopt those tools through more sophisticated omnichannel programs. Meijer.com, for example, is increasingly a hub for interactive marketing, particularly around the holidays. This past Halloween, the retailer created a separate landing page with costume ideas and drink recipes, and savings offers, all of which were tied together with signage in stores.“Meijer has an engaged digital shopper base, reaching millions of shoppers each week through digital coupons, email, mPerks, online circulars and social channels,” says Malin. “The most successful programs incorporate a strong digital platform that directly ties to what the shopper will see in-store, creating a cohesive look and feel online and offline.”Kellogg’s Benedetti agrees: “We see great results when we have clear and consistent messaging throughout the path to purchase,” she says. “Meijer’s shoppers are very digitally savvy, so it’s important to engage with them through digital vendor marketing, banner ads or simply through mPerks. Of course, having a strong in-store offer and disruptive POS with clear and effective messaging are also keys to a successful program.”Additional marketing opportunities may present themselves in the natural and organic foods categories, a growing priority for Meijer. The company recently merged its Meijer Naturals and Meijer Organics products into one line called True Goodness by Meijer, citing both a simpler brand designation for shoppers and a desire to reach Millennial moms as the rationales for the move. Meijer plans to add 100 new products (including granola chips, coconut oil, organic coffee pods, macaroni and cheese, juice boxes and frozen potatoes) to the True Goodness line by early 2016.Going forward, Meijer will continue to look to its brand partners for solutions that meet the two sides’ mutual marketing objectives. “When Meijer tells you that they want a collaborative relationship, they really mean it,” says Benedetti. “It is incredibly rewarding to see how open to our ideas our Meijer partners are, as long as we can demonstrate that we are acting with insights in hand and the best interests of their shopper.”About the SponsorCatapult is a conversion marketing agency, where branding and buying are part of a total solution. Catapult’s data-driven approach identifies the core, actionable insights that inspire brilliant creative with the power to convert consumers into shoppers, shoppers into buyers, and buyers into loyal advocates. Catapult delivers channel-agnostic solutions that are brand savvy, retailer smart, and digitally enabled. Catapult is an Epsilon brand. Visit them at www.catapultmarketing.com and on Twitter @catapultmktg.

Retail Intimacy, Part 14: Winning at Meijer

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