OUR NEW STUDY TAKES THE PULSE OF CANADIAN GROCERY SHOPPERS
7 HEALTH & WELLNESS TRENDS TO WATCH
FARM BOY’S WINNING PRIVATE-LABEL STRATEGY
FEBRUARY 2024
Longo’s president
DEB CRAVEN
On leadership, creating “amazing guest experiences” and growing the business
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Contents
February 2024 || Volume 138 - Number 1
26 12
TOP, FROM LEFT: TOBI ASHMOUCHA, CARD: GETTY IMAGES/LENKASERBINA, ENVELOPE: GETTY IMAGES/PEPIFOTO, CHRISTIE VUONG
59 Features
Departments
26 A new day at Longo’s
7 Front Desk 9 The Buzz 61 New on Shelf
President Deb Craven on leadership, creating “amazing guest experiences” and growth
31 Shoppers speak up
Our annual survey takes the pulse of grocery shoppers in Canada
44 Seven health and wellness trends to watch How to support your customers on the road to healthy living
PEOPLE
12 Hatching a new plan
Aaron Oosterhoff is bringing quail eggs to the mainstream IDEAS
15 Cookin with Sobeys
digs into Canadians’ appetite for frozen meat FRESH
49 The future of vertical farms Is Canada a green shoot for the struggling industry? AISLES
51 Rise and shine! How to
17 Powerhouse of opportunity We get the
57 Sweet on spreads
lowdown on Farm Boy’s private-label strategy
tech to AI, here’s what caught our eye at Retail’s Big Show
Longo’s president Deb Craven Photography by Tobi Asmoucha
23 Meaty matters Caddle
Sobeys teams up with a food delivery app
19 What you missed at NRF 2024 From in-store
On the cover
COLUMNS
21 Levelling the playing field Could an
international grocer set up shop in Canada?
win the breakfast crowd
Innovation is boosting growth in the category
59 Greeting cards: Four things to know From pop
culture icons to pop-up designs, it’s in the cards EXPRESS LANE
62 Restoring retail
Futurist Doug Stephens on why the physical shopping experience matters February 2024 || CANADIAN GROCER 5
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IDDBA 2023 By The Numbers: • 81% of attendees represented buyers and key decision makers • Over 1,600 retail attendees represented 564 retail companies • 1,977 Exhibit Booths/810 Companies/235 New Companies
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EDITORIAL ADVISORY BOARD BONNIE BIROLLO, SOBEYS; RAY HEPWORTH, METRO; KEN KEELOR, CALGARY CO-OP; BRENDA KIRK, PATTISON FOOD GROUP; CHRISTY MCMULLEN, SUMMERHILL MARKET; GIANCARLO TRIMARCHI, VINCE’S MARKET
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CORPORATE OFFICERS CHIEF EXECUTIVE OFFICER Jennifer Litterick CHIEF FINANCIAL OFFICER Jane Volland CHIEF OPERATING OFFICER Derek Estey CHIEF PEOPLE OFFICER Ann Jadown CHIEF STRATEGY OFFICER Joe Territo
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MAIL PREFERENCES: From time to time other organizations may ask Canadian Grocer if they may send information about a product or service to some Canadian Grocer subscribers, by mail or email. If you do not wish to receive these messages, contact us in any of the ways listed above. Contents Copyright © 2024 by EnsembleIQ, may not be reprinted without permission. Canadian Grocer receives unsolicited materials (including letters to the editor, press releases, promotional items and images) from time to time. Canadian Grocer, its affiliates and assignees may use, reproduce, publish, republish, distribute, store and archive such submissions in whole or in part in any form or medium whatsoever, without compensation of any sort. ISSN# 0008-3704 PM 42940023 Canadian Grocer is Published by Stagnito Partners Canada Inc., 20 Eglinton Avenue West, Ste. 1800, Toronto, Ontario, M4R 1K8. Printed in Canada
WHAT’S UP WITH SHOPPERS? If social media is a reliable indicator, it would appear Canadian grocery shoppers are not in the best of moods. Whether it’s videos on TikTok of frustrated shoppers reacting to their grocery bills or fuming posts on X (formerly Twitter) about all manner of grievances, big and small. But is all this a fair gauge of how shoppers are really feeling? To get a better understanding of what’s going on, across a range of topics, we surveyed Canadian grocery shoppers coast-tocoast for our fourth-annual GroceryIQ Study: Taking Stock of Grocery Shopper Attitudes and Behaviours. We learned a lot. We learned what irks shoppers, what they think about loyalty programs, how they size up e-comm, how they’re coping with inflation and how they choose a grocery store. And while yes, they’re feeling squeezed financially and are laser-focused on price—and they do want grocers to do better on price—it’s not their only consideration; shoppers also want quality and freshness. They’re seeking value. (Turn to page 31 for more insights on the study.) Value is certainly top-of-mind at Longo’s. In this issue, we speak with Deb Craven, the Ontario grocery chain’s president, about the many ways the company is working to deliver value to its customers, such as upping its game in private label, prepared foods and everyday staples. “We’ve now got a much more value-conscious guest. I don’t think that’s
going to change tremendously as the economy goes through the different phases it’s going to go through,” says Craven. We also talk to Craven about the grocer’s expansion plans, employee engagement, technology investments and more. (Read the interview on page 26.) Also in this issue, we talk to Farm Boy’s Alison McFarlane to get the lowdown on the grocer’s winning private-label strategy (page 17); we look at what’s next for vertical farming (page 49); and with Ottawa’s attempt to woo a foreign grocery chain to Canada to boost competition, we asked some retail experts to weigh in on which international players could set up shop here. Turn to page 21 to see what they had to say. CG
Shellee Fitzgerald Editor-in-Chief
sfitzgerald@ensembleiq.com
Keep up to date on the latest news by signing up for our daily e-newsletter. It’s free and we’ll deliver it to your inbox each morning. Visit canadiangrocer.com to subscribe February 2024 || CANADIAN GROCER 7
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The Buzz
The latest news in the grocery biz
OPENINGS GEORGIA MAIN FOOD GROUP opened its firstever Asian grocery store in early February in Port Moody, Metro Vancouver. Called Meiga (pronounced May-ga), the new store offers fresh produce and meats, an open kitchen with ready-to-serve hot foods including traditional Chinese take-away specialties, Cantonese BBQ, dim sum, congee, hot pot, sushi, fresh bakery and a juice bar. Georgia Main Food Group says it plans to expand the banner over the next three to five years.
FORTINOS, SUMMERHILL MAKRET, PATTISON FOOD GROUP, CANADIAN PRESS, BIO LOCAUX, SAPUTO
PRICESMART FOODS has opened a store in Burnaby, B.C. Owned by Pattison Food Group, this is the grocery banner’s third location in the province and the first to open since 2016. The store offers an array of traditional Western and Asian grocery products including fresh local and international produce. Other features include live seafood, a meat market, a bakery, an Asian-style market, and a takeout section with offerings such as Hong Kong-style noodles and made-to-order skewers.
In mid-December, FORTINOS opened a 60,000-sq.-ft. store in Bolton, Ont. The store boasts traditional grocery items, international foods, a full-service floral section, a health food department with certified holistic nutritionists, a full-service pharmacy, and showcases the chain’s Pane Fresco concept. This concept offers a range of foods crafted by Fortinos’ team of chefs including prime rib sandwiches, soups, sandwiches and artisan breads. A co-op of organic farmers in Quebec has opened its own grocery store in Montreal’s Rosemont neighbourhood. Named BIO LOCAUX, the store sells between 20 to 50 types of fruit and vegetables, depending on the season. The store also offers a wide variety of frozen meat, dairy products, quiches, maple syrup, flour, soups, spices, books, clothing and more.
AWARDS/RECOGNITION
(Clockwise from left) Fortinos opens in Bolton, Ont.; Summerhill Market preps to open its sixth location; Pattison Food Group opens its third PriceSmart Foods store in British Columbia; Dollarama expands in Toronto’s east end; a co-op of Quebec farmers open a grocery store in Montreal
SUMMERHILL MARKET is set to open its sixth store in February. With 3,200 square feet of retail space, the new store—located in Toronto’s west end at 3609 Dundas Street West—will focus on Summerhill Market’s specialty products. The new store will not have any service counters for what the gourmet grocer is describing as a “brisk” shopping experience. Summerhill Market currently has four stores in Toronto and one in Aurora, Ont. DOLLARAMA will open a location in Toronto’s Leslieville neighbourhood this winter. (An opening date has yet to be confirmed.) Located at 20 Leslie Street, the store will offer the discount retailer’s usual fare of general merchandise, non-perishable consumables and seasonal items.
LINO A. SAPUTO, chair of the board, president and CEO at Saputo, has been appointed as a Member of the Order of Canada. The Order of Canada honours Canadians who make extraordinary contributions to the country. Saputo has been actively involved in the company’s operations for more than 35 years and has held the position of CEO since 2004. Saputo was named chair of the board in 2017, having previously been appointed vice chair in 2011. He previously sat on the board of directors of Transcontinental and is a member of the National Bank of Canada and Global Dairy Platform boards of directors.
News to share? Tell us about your openings, comings and goings, etc. by dropping a line to sfitzgerald@ ensembleiq.com February 2024 || CANADIAN GROCER 9
The Buzz PEOPLE
Stephanie Lilak
Mondelēz International has hired Stephanie Lilak as its executive vice-president and chief people officer to oversee the company’s human resources function globally. She replaces Paulette Alviti, who will retire in April following a transition period.
PHOTO CONTEST!
Canadian Grocer is thrilled to announce the winners of our firstever photo contest! Last September, we called on the grocery industry to submit their favourite pictures taken in 2023. The editorial team reviewed all submissions and the following images came out on top based on originality and quality:
Loblaw has appointed Melanie Singh as president of its hard discount division. Singh has been with the grocer for 14 years, most recently serving as senior vice-president hard discount No Frills and Maxi.
Susan Herman
Olivier Gardère
David Smales
Dennis Prouse
Josh Domingues
1
Save-On-Foods (first) Photo credit: Save-On-Foods Pemberton Plaza
Peninsula Co-op has promoted Susan Herman to vice-president of finance. Herman has been with the Vancouver Island-based co-operative since 2008. In her new role, Herman will continue to shape the financial landscape of the organization to support future growth.
2
After six years with Agropur and what the company is calling a “strong tenure of achievement in the organization,” Olivier Gardère has been named vice-president, cheese and butter category. He most recently served as vice-president major account sales. Maple Leaf Foods has announced chief financial officer Geert Verellen is stepping down from the company. David Smales has been named as his replacement. Smales previously spent nearly 15 years as executive vicepresident and chief financial officer at Aecon Group. Prior to Aecon, he was the chief financial officer at Catalyst Paper Corporation. Food, Health & Consumer Products of Canada (FHCP) has hired Dennis Prouse as its vice-president of government relations. Prouse brings more than 25 years of experience in government relations and public affairs to the organization, having held senior roles at the Canadian Seed Growers’ Association, CropLife Canada and the Insurance Bureau of Canada. Flashfood has made executive shuffles at the top. Founder Josh Domingues is transitioning to the role of executive chairman, while president and chief operating officer Nicholas Bertram takes the helm as the Toronto company’s chief executive officer. Meanwhile, chief brand officer Jordan Schenck moves into the newly created role of chief customer officer.
10 CANADIAN GROCER || February 2024
3 Pembina West Co-op (second) Photo credit: Cheyenne Tischer Saputo (third) Photo credit: Sharon Gower For the next phase of our photo contest, we’re looking for your best seasonal snaps—from photo-worthy initiatives to in-store tech, unique merchandising displays, seasonal decor, renovations and more. Amateurs and professionals alike are encouraged to participate. Show off your photography skills! The deadline to submit is July 29. Contact jmorgan@ensembleiq.com for more information.
TIME TO NOMINATE! We’re looking for the most impressive women working in the Canadian grocery industry today for our 2024 Star Women in Grocery Awards. If you know of an outstanding woman who is making a difference in grocery, please take a few minutes to tell us about her at StarWomen.ca. The deadline to nominate is March 28 and winners will be revealed in our June/July issue.
FIJI Water shifts to 100% recycled plastic
*
FIJI Water has taken a big step in its commitment to environmental sustainability. The company, which sources natural spring water from the Fijian islands, has transitioned its best-selling 500 mL and 330 mL bottles to 100% recycled plastic (rPET) in Canada. The move replaces nearly 70% of FIJI Water’s bottle volume worldwide with recycled material. Globally, FIJI Water is working to transition its entire bottle portfolio (which also includes 700 mL, 1 L and 1.5 L bottles) to recycled plastic by 2025. “In our transition to recycled plastic, our intention is to make a truly meaningful and lasting environmental impact,” says Wai Mei Lee, vice president of international, FIJI Water, a division of The Wonderful Company. As PET and rPET share nearly all the same qualities – they’re both shatterproof, lightweight and suitable for use in food packaging – consumers likely won’t notice a difference. “In using recycled plastic, we give new life to existing materials while maintaining the same great taste, look and quality that consumers expect from FIJI Water,” says Lee. The move comes as consumers increasingly seek ways to reduce their environmental footprint and support brands that align with their values. As Lee notes, sustainable materials have become more desirable as consumers consider where product packaging comes from – and where it’s going. To raise awareness about FIJI Water’s 100% recycled bottles, the brand has launched a new campaign. The creative is centred on the notion of “hundreds of moments” in nature, for example, “mountains awaken at dawn” and “a flower blooms at sunrise.” According to the company, FIJI Water is continually inspired by its lush, natural origins. “It’s a vitality and appreciation for nature that carries across our brand,” says Lee. “In the Canadian market, where there is an abundance of nature, we saw an opportunity to share that appreciation for natural moments, whether we’re in a tropical jungle or the East Coast of Canada.” FIJI Water’s shift to recycled plastic is part of its broader commitment to sustainability. The company has invested nearly $3 million CDN in energy-efficiency initiatives on the Fijian islands, which includes the use of microturbine energy generation and adopting low-sulphur fuel standards for shipping to reduce emissions. In addition, the FIJI Water Foundation provides funding to protect the Sovi Basin, Fiji’s most important forest ecosystem and largest remaining lowland rain forest, in partnership with Conservation International. “As one of the world’s leading naturally sourced spring waters, and the number-one premium imported water, we believe the best things come from nature and are dedicated to taking steps to protect the environment today and for generations to come,” Lee says.
*BOTTLE ONLY
People
HATCHING A NEW PLAN
When Aaron Oosterhoff took over his uncle’s quail farm in Saint Ann’s, Ont., he set out to make quail eggs widely available on grocery store shelves By Andrea Yu Photography by Christie Vuong
12 CANADIAN GROCER || February 2024
Who you need to know
A
Aaron Oosterhoff’s childhood was all about farming. Growing up in the Niagara Region, his family had a hog, pig and poultry farm. As a teenager, he worked part time at Spring Creek Quail Farms, which was owned by his uncle Clarence. “I grew up collecting quail eggs, feeding quail, cleaning pens and packaging eggs,” Oosterhoff explains. While he pursued a career in the trades as an electrician, in 2016, Oosterhoff felt drawn back to life on the farm. By then he had met his wife, Lyndsay, and the two started growing their family (they now have five kids). “The farming life beckoned to us,” he says. So, Oosterhoff approached his uncle, who was considering retiring from his quail farming business, and asked if he’d be interested in becoming business partners. His uncle agreed. Learning how to run a quail farm wasn’t all smooth sailing. Oosterhoff recalls a cold and muddy February in 2017, just a year into the partnership with his uncle, when they were building more barns but the weather wasn’t co-operating. “The ground was not frozen, so the yard was muddy and everything was getting stuck,” he recalls. “We were knee-deep in mud.” But they persisted. And by 2018, his uncle felt confident enough in Oosterhoff ’s abilities to step back from the business, leaving Spring Creek fully in Oosterhoff’s hands. When Oosterhoff took over the company, he had just five full-time employees. Spring Creek’s quail eggs were being sold in a handful of specialty, independent retailers in Ontario and parts of the Northeastern United States. But Oosterhoff made it his mission to increase the farm’s capacity so it could stock major grocery stores. “We’d seen a huge uptake in North America, especially with a younger demographic of people trying new flavours and cuisines from other countries,” he explains. “Quail eggs fit very well with that.” The product also suits those who are allergic to chicken eggs. By the spring of 2019, Oosterhoff landed his first major grocer—appearing in about 130 Metro Ontario stores. “It was very cool,” Oosterhoff says. “But, we were unsure if our customer base would come through and drive sales in those stores.” To help increase awareness about quail eggs and how to use them, Oosterhoff launched social media and online marketing campaigns, worked alongside
nutritionists and shared recipes on Spring Creek’s website for dishes such as tuna poke bowl, baked pumpkin doughnuts and beet hummus toast, all made with quail eggs. The campaigns worked and by the fall of 2020, Spring Creek had launched in 70 Sobeys and 30 Farm Boy locations in Ontario. The next big break came when its quail eggs landed on the shelves of a dozen-odd Costco locations in Ontario and Quebec in the spring of 2021. “It was a pretty big step for us,” says Oosterhoff. That year saw another boost for Spring Creek with the launch of its hard-cooked quail eggs. “Up to that point, every time people wanted hard-cooked quail eggs, they were importing them in cans from overseas,” Oosterhoff explains. “Yet, we have a great supply of fresh quail eggs. It’s also a great opportunity for people to use them in foodservice.” In 2023, Spring Creek expanded further with the launch of three flavours of hard-cooked pickled quail eggs: salt ‘n vinegar, scorching hot, and garlic & jalapeño. Currently, Spring Creek’s fresh and pickled quail eggs can be found in about 3,000 stores in Canada and the United States. The company’s team has also grown to more than 20 fulltime and 20 part-time employees. Looking ahead to the rest of 2024, Oosterhoff has found himself in what we’ll call a “quail or egg” conundrum: do you increase capacity to meet future demand or wait until the sales come in, which may hinge on having capacity? Oosterhoff has chosen the former strategy. “We’ve just built about 25,000 square feet of capacity that we’re not sure the market can bear,” he says. “We’re taking a bit of a bet on it.” His goal is to expand further into the United States and bring quail eggs onto even more shelves in North America. Regardless of how Spring Creek’s latest expansion plans go, Oosterhoff says his uncle Clarence is amazed at the company’s success since passing the torch. “He’s extremely proud,” Oosterhoff says. “Working with big retailers like Costco is something he never dreamed of. He’ll come by the farm and say, ‘I can’t even believe this is happening.’” A n d w h i l e h i s c h i l d re n a re s t i l l young—Oosterhoff’s eldest is just 11 years old—he’s already giving them a taste of the farm life and hoping they might carry on the legacy. “They like to come check out the barns with me,” he says. “I hope that farming is in their blood.” CG
30 seconds with …
AARON OOSTERHOFF What do you like best about your job?
I love that it’s something new every day. I love problem-solving, dealing with issues and fulfilling the vision that we have. It’s exciting to get up in the morning, knowing there are people out there who love our products.
What’s the best customer feedback you’ve received?
We had a customer reach out by email and say: “You saved my daughter’s life because we couldn’t find a protein that she could eat. Because she’s able to eat your quail eggs without having a reaction, she’s finally put on weight.”
If you weren’t in the food business, what would you be doing? I would be doing something entrepreneurial. It’s in my bones. I enjoy the business side of things.
What’s the best career advice you’ve received?
Try to set a clear goal for yourself, but don’t be too tied to it. Don’t think the career path you’ve chosen at age 20 is the one you’ll be doing when you’re 40. Be open to new opportunities along the way.
What do you like to do when you’re not working?
I like hanging out with my kids and my wife. We love gardening in our backyard. We just built a garden shed with a nice fenced-in area around it. We also like travelling a lot, too. We’ve recently visited the Dominican Republic, Banff, Jasper and the United Kingdom. We’re pretty into music, too. I play the piano and the pipe organ.
February 2024 || CANADIAN GROCER 13
CONSUMERS CHOICE: Voted Best New Coffee Pods Lavazza Nespresso* Compatible Capsules
*Lavazza is not affiliated with, endorsed or sponsored by Nespresso *Rated the Best New Product for the Coffee Pod category by Canadians in a 2024 BrandSpark survey.
Ideas
RETAILERS || SUPPLIERS || SHOPPERS || INSIGHTS
MARKETING
SOBEYS
COOKIN WITH SOBEYS THE CREATION OF community-focused social media content that positions produce and products from Sobeys as chef-grade quality is one of the objectives behind the grocer’s partnership with homemade food delivery marketplace app, Cookin. First announced in November and officially launched at an event in Toronto in late January, the partnership will see Sobeys promote Cookin to its customers both in-store and online, including with special offers. Cookin is promoting Sobeys to its customer base, showcasing content from home cooks on the app including private chef Nicholas Heckbert. Heckbert is featured in videos on TikTok and Instagram picking up fresh produce and products from Sobeys’ private-label brand, Compliments, to make ratatouille lasagna, which customers in his delivery area can order. Last summer, Sobeys approached Cookin in pursuit of a strategic partnership that aligned well with the grocer’s brand, culture, values and purpose, says Doug Nathanson, EVP, chief development officer and general counsel at Empire Company, owner of Sobeys. “And the minute I met the Cookin team, I knew
it would be a great partnership,” he says. “There’s such a diverse range of chefs on the app and so, as much as we can, we will be encouraging them to come into Sobeys for their ingredients and highlight them to people so they not only enjoy their food, but [also] learn about the recipes.” Nathanson says he doesn’t see the partnership cannibalizing Sobeys’ home-meal replacement offerings in-store and online with Voilà. “People also go to restaurants, and this is just another alternative for them,” he explains. “And so, we don’t think this detracts from anything we do or what Cookin does— it’s an enhancement for both of our customers.” For its part, Cookin had been looking to partner with a major grocery chain, says Morley Ivers, co-founder and CEO of the two-year-old, Toronto-based company. “We, ultimately, chose Sobeys to partner with nationally because there was strategic alignment,” he explains. To date, Cookin has boarded nearly 500 chefs in Toronto alone, and is vetting home chefs and bakers from across Canada in expanding the app’s service. —Chris Daniels
February 2024 || CANADIAN GROCER 15
Natural choices can lead to great things. We’re proud to support
#Toonies4Tummies
Ideas
POWERHOUSE OF OPPORTUNITY
As consumers continue to search for value, Farm Boy looks to deliver with its stable of private-label products By Kristin Laird PRIVATE-LABEL BRANDS are having a moment. Increasingly, consumers are turning to store brands as food prices remain high and the cost of living increases. One of the front-runners in this space is Farm Boy. The Empire-owned banner offers more than 2,000 private-label products spanning various categories including snacks, bakery, frozen, deli and condiments, and has built a loyal fan following in the process. Here, Farm Boy’s private label product manager Alison McFarlane gives Canadian Grocer a behind-the-scenes look at the strategy and design process that goes into the retailer’s store brand.
Farm Boy’s media kit says, “When our buyers set out to find the best products for our line of Farm Boy private-label items, their search begins close to home.” Can you walk me through that process?
We’re always in search of exciting new Farm Boy private-label products to enrich our collection. Actively connecting with the community, touring facilities and meeting with manufacturers are integral parts of our ongoing efforts. Building enduring relationships with local producers remains a key focus for us. Through collaborations with smaller-scale manufacturers, we’ve been able to foster innovation, craft unique recipes and ensure value for our customers, as seen in favourites like Farm Boy Roasted Banana Blast Ice Cream and Farm Boy Italian Style Meat Lasagna.
FARM BOY
How do you ensure private-label packaging conveys quality?
Quality is at the forefront of our priorities, guiding our choices when selecting items for our private label. Equally important to us is ensuring the factors that initially sparked our excitement during the
product’s development are the same factors that resonate with customers when they encounter it on our shelves. To accomplish this, our product and packaging development are closely intertwined, placing a strong emphasis on conveying the story, benefits and value of each product.
How do you make certain the product design process is agile and quick enough to respond to trends and product opportunities?
We are continually developing new items, with hundreds coming down the pipeline simultaneously. Luckily, our exceptional team has devised an extremely efficient development process, allowing us to swiftly stock our shelves with new products within weeks, when required.
What is the process for identifying and addressing white-space opportunities within a category?
We consistently assess the performance of various categories, actively seeking opportunities to elevate our offerings and add value to our customer’s shop. As part of this ongoing process, we pay close attention to customer favourites through our annual Fan Faves campaign—listening
to what resonates with people and understanding the elements they love. This not only helps us curate a selection that aligns with popular preferences, but also allows us to craft a more engaging shopping experience. It’s all about connecting with our customers and ensuring that each product on our shelves is not just an item, but a story that adds value to their lives.
What lies ahead for the Farm Boy private-label brand?
We’re excited to expand our private-label selection, with more than 300 products set to launch this year. As we look ahead to 2024, our focus is not only on quantity, but on delivering a diverse and exciting range for our customers. Customers can anticipate more seasonal items, incorporation of global flavours and putting new spins on old customer favourites.
Farm Boy products span a range of categories from dips (Eda-Yummy Spicy Kale Dip) to soup (West African Peanut and Hungarian Style Beef Goulash) to frozen desserts (Roasted Banana Blast Ice Cream)
February 2024 || CANADIAN GROCER 17
Nominations open for 2024 3 AWARD CATEGORIES TO ENTER: Senior-Level Stars Shining Stars Store-Level Stars
NOMINATIONS CLOSE MARCH 28 2024 To nominate and for full award details, visit: StarWomen.ca GOLD SPONSORS
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Ideas
What you missed at NRF 2024
Executives from Meijer, Kroger and more shared insights on technology at the NRF ’24 Retail’s Big Show in New York City in mid-January. Here are a few key points that caught our attention By Kristin Laird
JASON DIXSON PHOTOGRAPHY
THE CONNECTED SHOPPER
It may sound obvious, but a positive in-store experience can hinge on high-performing Wi-Fi and network systems. Not only does it give customers better control over their mobile journey through the store, but it can also improve employee efficiency, which, again, can positively impact the customer experience. It’s imperative, for instance, that U.S. Midwest supermarket chain Meijer have a reliable network in place to ensure customers can use its Shop & Scan app with ease, said Rodney McCarter, the retailer’s vice-president of infrastructure and operations. (The app allows customers to scan items in-store, add them to their shopping cart, clip digital coupons and bypass the checkout line.)
Even third-party grocery delivery services such as Instacart rely on the store’s network to fulfil orders quickly and efficiently, said McCarter. “Years ago, people thought of customer Wi-Fi as a nice to have. Today, customer Wi-Fi underpins some revenue-generating operations for us,” he said.
THE CONNECTED WORKFORCE
Following a pandemic-driven decline in the retail workforce, Schnuck Markets—a family-owned supermarket chain in the Midwestern United States—turned to machine-learning software to create an automated scheduling system that helps prioritize tasks. The system looks at how many employees are working a shift and uses that
information to rank tasks by importance. And if someone doesn’t show up for a shift, the system can adjust in real-time to ensure the most pressing items are completed first. “Everybody wants to be responsible for something,” said Kim Anderson, vice-president of store operations support at Schnuck Markets. “So, you can send them a task and if you tee it up for them and prioritize it, they feel a sense of pride when they get that done. We’re stacking [the tasks] so they can accomplish the most important thing first.”
HIRE, TRAIN AND RETAIN
Opportunities for training and development are key areas of focus for U.S. grocery chain Kroger in attracting potential job candidates. Recognizing the “traditional model of training in a classroom for several hours is no longer a fit,” Kroger digitized the experience and took it to the store floor, explained the grocer’s chief information officer and senior vice-president Yael Cosset. Kroger rolled out a network of digital devices that provide staff with tailored, bite-sized training modules they can access throughout their workday, he said. “Simplifying the associate journey throughout their day by leveraging the devices … tends to be a pretty powerful tool for some of the demographic groups [working in our stores],” said Cosset.
February 2024 || CANADIAN GROCER 19
WESTERN CANADA’S LEADING GROCERY CONFERENCE + TRADE SHOW
APRIL 22-23, 2024 VANCOUVER CONVENTION CENTRE EAST BUILDING
COME TO WESTERN CANADA’S LARGEST GROCERY EVENT! Attend the ONLY western-focused grocery conference + trade show – April 22 & 23, 2024 during the GROCERY WEEK in Vancouver! Retailers, Grocers, Wholesalers, Mass and Convenience from across Canada will converge in Vancouver, BC this spring!
GROW YOUR BUSINESS
CONNECT
DISCOVER
Network and build your business with the industry throughout the two days at industry cocktails, onsite meetings and discussions.
With the show app, make dedicated one-to-one retailer meetings, attend free networking cocktails and events to network.
Explore new innovations and products/services at various pavilions (Buy BC Pavilion, Ontario, Sustainability Sentral, First Timers).
TO EXHIBIT ROLSTER TAYLOR: RTAYLOR@CFIG.CA EVENTS/CONFERENCE: EVENTS@CFIG.CA
Ideas
Levelling the playing field IN AN INTERVIEW with the Toronto Star last December, Industry Minister François-Philippe Champagne said he was in talks with grocery executives from around the world in hopes of attracting a foreign competitor to the Canadian market. Champagne said part of the government’s strategy to help tame grocery prices in Canada was to increase competition and challenge the big five chains—Loblaw, Metro, Empire, Costco and Walmart—which dominate the market. After decades of consolidation, an international challenger would be a “net benefit” to Canadian consumers, said Champagne. “I’ll be working with anyone who wants to consider it,” he said. “I’m not the shy guy, usually, I pick up the phone.” We asked some of the industry’s leading retail experts to share their thoughts on which international players could potentially set up shop in Canada or if the market is even ready to welcome foreign competitors. Here’s what they said: “Entering Canada’s highly competitive grocery market is a challenge for any international retailer, given the dominant players— Loblaw, Sobeys, Metro, Walmart, and Costco— control 60% of all retail sales and offer strong private labels, loyalty programs and convenient locations. Aldi, on the back of its success in the U.S., might consider breaking into Canada. However, considering local retailers’ well-defined discount banners, Aldi’s strategy in
POLL
Canada may depart from the retailer’s typical aggressive store openings. Success would hinge on careful market analysis, focusing on multicultural assortments and exceptional shopping experiences to meet the expectations of value-seeking Canadian shoppers.” Amar Singh, senior director, Kantar “With over 3,700 stores, REWE, Germany’s prominent food retail company, could come to Canada. I’ve had the opportunity to visit several of their stores in Germany. REWE offers a diverse range of store formats, from local convenience to fullrange supermarkets and superstores. REWE adapts to meet the unique needs of each neighbourhood. Creatively designed stores seamlessly integrate into urban landscapes, providing a distinctive shopping experience. As Germany’s pioneer in combining online shopping with delivery services, REWE’s proven success in offering a wide product range online could appeal to Canadian consumers. The convenience-focused approach, including efficient click-and-collect services, aligns with evolving shopping preferences, making REWE a potential asset in the Canadian grocery market.” Lisa Hutcheson, managing partner, J.C. Williams Group “Before considering the entry of any new grocers into the Canadian market, we must first undertake some essential preparations to make our market
more appealing for potential investors. Without addressing key issues such as supply chain inequalities, complex fiscal policies and interprovincial trade barriers, it’s unlikely that outside grocers would have chosen to enter Canada on their own. Currently, the existing players in the market are well-established and have a deep understanding of the Canadian market dynamics. Therefore, until we address these challenges and create a more conducive environment, searching for alternative grocers is a futile exercise. In essence, Ottawa is effectively inviting external grocers to a banquet with no chefs in the kitchen.” Sylvain Charlebois, professor of food distribution and policy, Dalhousie University “I don’t think any are in our near future. This is not the climate for it. And, the most interesting, Aldi and Lidl, have plenty to do to win the U.S. Trader Joe’s has hurdles in getting their private labels over the border. The oligopoly shoppers hope a foreign player would break up is one of the reasons a competitor would be reluctant to enter. Yet, the oligopoly is only one factor hampering consumer prices and choice. Price floors are also influenced by our higher costs of business (tariffs, employee protections, distances to cover, etc.). Rather than hoping for a new ‘whale,’ the government might look at breaking up not only the current concentrated retail power, but also the distribution of product to smaller independents. Not that I see this happening in the near term, but it might be more plausible.” David Ian Gray, founder, DIG360
As Ottawa looks to bring a new supermarket chain to Canada, we asked our readers at CanadianGrocer.com to weigh in on which foreign competitor could set up shop in the Great White North. Here’s what they had to say:
Which international grocery chain could come to Canada? ALDI
35%
TRADER JOE’S
33%
KROGER
13%
LIDL
12%
OTHER
7%
February 2024 || CANADIAN GROCER 21
WIN YOU COULD
*
FREE GROCERIES FOR A YEAR. SERIOUSLY!
Or the chance to win a $250 grocery gift card every week.
* winwithastro.ca
Scan QR code to learn more
2024
*NO PURCHASE NECESSARY. CORRECT ANSWER TO SKILL-TESTING QUESTION REQUIRED. CONTEST BEGINS AT 10:00 AM (ET) ON JANUARY 1, 2024 AND CLOSES AT 11:59 PM (ET) ON MARCH 7, 2024. ONE FORM OF ENTRY FOR YOUR CHANCE TO WIN A GRAND PRIZE AND/OR WEEKLY PRIZE IS TO PURCHASE ANY PARTICIPATING ASTRO YOGOURT, SUBMIT THE PURCHASE RECEIPT & COMPLETE THE ENTRY FORM WINWITHASTRO.CA. SUBMISSION OF PURCHASE RECEIPT WILL RESULT IN ONE (1) ENTRY AND THREE (3) BONUS ENTRIES PER PERSON. ONE GRAND PRIZE (ARV $13,000) AND NINE (9) WEEKLY PRIZES (ARV $ 250) AVAILABLE TO BE WON. ODDS OF WINNING DEPEND ON NUMBER OF ELIGIBLE ENTRIES RECEIVED. CONTEST OPEN TO ALL INDIVIDUALS WHO ARE RESIDENTS OF CANADA AND LOCATED IN CANADA AT THE TIME OF ENTRY, AND HAVE REACHED THE AGE OF MAJORITY IN THE PROVINCE THEY CURRENTLY RESIDE. ©2024 LACTALIS CANADA. ALL RIGHTS RESERVED. TRADEMARKS OWNED OR USED UNDER LICENSE BY LACTALIS CANADA, TORONTO ON, M9C 5J1.
CONSUMER CONNECTION || Ransom Hawley
The meat of the matter
In tough times, a look at how shoppers are approaching the frozen meat category
While frozen meat is not an everyday purchase for most Canadian shoppers, it remains a freezer staple for many
SHOPPING BEHAVIOURS HAVE been in flux with high interest rates and inflation taking a bite out of Canadians’ budgets. Many consumers have looked for ways to save in the grocery aisles, and as one of the pricier items on the grocery list, meat is one place to do just that. For a better understanding of Canadian shoppers’ take on frozen meat, Caddle surveyed a weighted representative sample of thousands of consumers coast-to-coast. According to five Daily Survey Panels between December 2023 and January 2024, a majority (68%) of respondents said they shop for frozen meat—with just 32% saying they do not. While most Canadians do buy frozen meat, it is not a frequent purchase. A little more than 29% of Canadian shoppers said they buy it rarely, whereas 23% said they buy it monthly, and nearly 22% add it to their carts a few times a month. When Canadians do shop for frozen meat, it is to be enjoyed as a meal for the family, with a whopping 88.4% serving it up for dinner any day of the week. For most shoppers, frozen meat is a planned purchase. Only 21% of respondents said they buy it on impulse, compared to 79% who go to the store with a product in mind. Most shoppers stick to brands they know and love. When their brand of choice is not available, more than half of respondents said they would look for it on their next shopping trip, compared to one-quarter of consumers who said they would not be opposed to switching brands. The data shows there is a generational divide in approaches to stocking the freezer. Nearly 40% of boomers say they rarely buy frozen meat and consume it just a few times per month. Compare that with the younger generations, and there is a stark
difference. Millennials, for instance, were most likely to say they shop for frozen meat weekly or more frequently, followed closely by gen Z. Those younger, less financially established generations are also more likely to have changed where they buy frozen meat in the last 12 months and are more willing to go to another store to find their favourite brand or search for better deals at discount grocery chains. The generational differences continue when it comes to private-label brands. Across the board, 63.6% of respondents say the quality of private-label frozen meat is the same as national brands. Yet, boomers are more likely to see it as lesser quality and trust it less than some national brands. They also make up the majority (37.4%) of respondents who said they are not at all likely to buy private-label meat in the next six months. Younger generations show much less brand bias, with 33.3% of millennials saying they trust private labels more than national brands, followed closely behind by 28.1% of gen Z respondents. They are also more likely to buy online. While only 12% of people surveyed said they get their frozen meat primarily online, millennials were the generation most likely to do so (37.9%) and boomers the least (15.1%). When ordering online, Walmart is the preferred choice for frozen meat purchases for most respondents (32.9%), with Loblaws trailing closely behind (31.7%) and Costco as the merchant of choice for 29.2% of shoppers. The role played by reviews and ratings in influencing purchase decisions is largely dependent on where shoppers are buying. Only 19.1% of respondents said ratings and reviews are very important in their decision-making process when shopping for frozen meat, while 17% said they aren’t at all important. For in-store shoppers, they are less of a consideration than for online shoppers. Indeed, ratings and reviews of frozen meat products are very important factors in helping sway purchasing decisions online for 61% of people. While frozen meat is not an everyday purchase for most Canadian shoppers, it remains a freezer staple for many. When asked to look ahead to the next six months, 41.5% of people surveyed said they plan to buy more of it—most of whom were millennials and gen Zers. For younger generations who may be more focused on savings and convenience, frozen meat has clear benefits worth shopping around for. CG
Ransom Hawley, former packaged goods leader, is founder and CEO at Caddle Inc., the largest mobile-first insights platform that rewards Canadians for sharing data and engaging with brands.
February 2024 || CANADIAN GROCER 23
Piller’s celebrates CEO’s remarkable 50-year contribution Piller’s Fine Foods, leading manufacturer of specialty deli meats, honours its CEO, Willy Huber Jr.’s, 50th anniversary with the company. Wilhelm Huber Jr., more affectionately known as Willy, the eldest son of company co-founder Wilhelm Huber Sr., has been an integral part of Piller’s since his early years. Starting at the company’s Kitchener Farmer’s Market stand as a teenager and later apprenticing in Germany, he emerged as a fifth-generation sausage maker, bringing his expertise back to Canada and Piller’s in 1974. Over his five
decades long career, Willy has held many positions including Sausage Maker, Plant Manager and VP Operations, and was ultimately appointed to President and CEO in 2000. Reflecting on his journey, Huber Jr. expresses, “I’m most proud of having been able to work alongside my father and brothers for many years, seeing what we built and how far we’ve come together, but none of it would be possible without the support and dedication of our people. I am so grateful to my family, our longstanding vendors and customers, and Premium Brands for their support.” Piller’s was founded in 1957 by Wilhelm Huber Sr. and became a division of, leading Canadian food company, Premium Brands Holdings Corporation in 2011.
“Fifty years is an incredible accomplishment, and we’re happy to celebrate this milestone with Willy,” says George Paleologou, President and CEO of Premium Brands. “Willy embodies our values of entrepreneurial spirit, coupled with a passion for supporting his local community.” Outside of Piller’s, Willy remains actively involved with the Waterloo Wolves U18 AAA hockey team, as a founding member of the operating committee, a position he has held for over 23 years. When asked about the future of Piller’s, Huber Jr. expressed excitement about the company’s expansion into new markets, investment in cutting-edge technology, and the ongoing commitment to delivering high-quality, innovative products to the market.
Making Food. Making Memories. Make memorable food experiences with Piller’s. We craft delicious deli meats, sausages and snacks using traditional techniques like natural wood smoking and dry aging. Piller’s is the specialty meat brand for families and food lovers.
Longo’s president Deb Craven on creating “amazing guest experiences” and leading the admired grocer through its next phase of growth
A NEW DAY AT LONGO’S 26 CANADIAN GROCER || February 2024
PHOTOCREDIT
By Shellee Fitzgerald Photography by Tobi Asmoucha
W PHOTOCREDIT
Cover story
HILE THERE IS NO shortage of challenges in grocery retail, Deb Craven is up to the task of taking them on. Over the last three decades, the Sarnia, Ont. native has racked up a wealth of experience at large international firms such as Deloitte, Nike and Purolator, where she learned valuable lessons in accountability, the power of brand, and logistics and distribution. While she was working in Calgary for Canadian Tire (as senior vice-president of finance for the Mark’s and Sport Chek brands), Longo’s came calling. Soon after, in May 2019, she joined the Ontario-based grocer as its chief financial officer. “It just seemed like the perfect opportunity,” says Craven. “I was excited to learn about grocery and being able to apply all that I’d learned at other companies. And I loved the Longo’s brand. I was a very loyal Longo’s shopper before I moved to Calgary!” Last May, Craven was given a chance to further put her skills to work when she became president of the 68-yearold company, the first woman and nonLongo family member to hold the role. As long-time president and CEO Anthony Longo—remaining CEO and executive chairman—shifts focus to the company’s long-term strategy, Craven is charged with leading Longo’s day-to-day business and ongoing growth strategy, as well as overseeing nearly 6,000 team members across the grocer’s 38 (and growing) locations and delivering on its mission of “fuelling happier and healthier lives.” We spoke to Craven about the responsibility of leading such an admired grocer, expansion plans, tech, employee engagement and how the Empire partnership is working out. The interview has been edited for length and clarity.
February 2024 || CANADIAN GROCER 27
Cover story After four-plus years working in the industry, what are your observations about grocery?
Well, I hit the industry probably in some of the most challenging times there have been. Like all other retail, it’s incredibly competitive and it’s constantly changing. I think the real learning is how much more immediate grocery is compared to [other retail industries] with people coming into the stores once, twice, three times a week. Whereas with Sport Chek, as an example, maybe they were coming in once every season. There’s an immediacy to grocery, and needing to be aware of what guests are coming for on a regular basis and meeting those needs—that’s been a huge eye-opener. And the thing we’ve been really spending a lot of time on is how multicultural our province is and understanding how to best serve the different communities our stores are in.
Often, grocers who have been in the business a long while will say grocery is “in their blood.” Do you feel like you’ve caught the grocery bug?
Yes, I do. I have a ton to learn and that’s why I’m so lucky here because I have this other experience [from previous roles] and then I’m surrounded by people who have been in this business for years, who have been doing this since they were 14, 15 working in the stores. I’ve learned to ask a lot of questions.
What’s it like being the first woman and non-family member leading Longo’s into its next stage of growth? How do you feel about that responsibility?
Well, responsibility is a good word for it. It’s a tremendous responsibility, one that I don’t take lightly. I feel very supported. I have an incredible team. What I love about this team is that we have a number of people who have been here for many years, and we have a lot of people who have been here for just a few years. So, we’ve got a good blend of newer people who are coming in and saying, “Well, why do we do this? Why do we do that?” and just trying to understand it. Then we’ve got that incredible depth of history and knowledge of people who say, “Well, here’s why we’ve always done it, but it doesn’t mean that we have to keep doing it this way.” I haven’t given a lot of thought to being the first woman in the role; I think because I came up in logistics and 28 CANADIAN GROCER || February 2024
distribution, there weren’t a lot of women in that field. I was the first female VP at Purolator and I have been very used to —for most of my career—being one of the only females at the table and learning not to limit my voice. That’s what I value so much about my time at Purolator, my peers and people I reported to there really taught me to have a voice, to have a point of view and not shy away from it.
You became president last May. As you position Longo’s for its next phase of growth, what are your priorities?
With the partnership with Empire, last July we transitioned all our Grocery Gateway guests over to Voilà, and that has allowed us to focus solely on in-store and our digital experience—digitally giving guests information about products at Longo’s. It’s allowed us to focus on that in a way we probably haven’t had the luxury of doing in the past. Our guests are getting the best of both worlds; they’re getting all the products they wanted when they were shopping with Grocery Gateway, and they’re getting the benefit of an amazing Voilà system. So, the focus is on stores—new stores, renovations of some of our existing stores and then, of course, the doubling in size of our DC [distribution centre] to support that. And then the other area of focus is that we’ve got a much more value-conscious guest. I don’t think that’s going to change tremendously as the economy goes through the different phases that it’s going to go through. [Guests] want to make sure they’re getting value—that doesn’t mean they’re spending less, per se, they might be spending the same amount, but they want to make sure they’re getting value and the best products they can for the money they’re spending.
How do you communicate value in-store?
It’s something we are constantly working on, and we have several ways that we’re trying to showcase value. I wouldn’t say we’ve perfected it—we’re still learning, we’re listening to our guests and to our team members, but our promotions and price changes are an obvious first way that we communicate through flyers and digitally [and] trying to make sure we’re identifying the right products that our guests need at this particular time. The other way we’re really trying to focus on value is through the expansion of our private brands. We’ve got three levels within our private brands portfolio and one is Longo’s Essentials [everyday staples]
and we keep expanding that product line because it’s a real value-driver for our guests. Another value-driver for us is our Thank You Rewards program. We’ve had that for years, and if you’re a member there’s member pricing on select items each week [and points earned can be redeemed for free groceries]. Recipe inspiration is another way—you can go to our website or our Longo’s Experience magazine and find our 5 Easy Meals meal plan for recipes, a shopping list of everything you need to make the recipes, and it all comes in at under $100 and provides five dinners for a family of four.
Speaking of meals—Canadians are dining out less at restaurants. Is there a bigger opportunity right now for grocers to win more of the foodservice share of stomach?
We’re definitely looking at expanding our prepared foods—trying to create meal solutions that cater to any level of preparation our guests want. If they don’t want to do any prep at all and are thinking about going to a restaurant but then say “Oh, it’s expensive. Let’s stay in, but let’s do something special,” then we have amazing ready-to-eat options. If you want to do a little bit of prep, then we have all kinds of ready-to-heat solutions where the bulk of the work has been done. If they want a bit more prep, then we have meal kits—my favourite is the fish tacos. I love them! And then we’ve got Kitchen Hub [the first ghost kitchen to open inside a Canadian grocery store] in our downtown Toronto Liberty Village location. [The partnership] has worked out really well. Longo’s is amazing at Italian food— it’s our heritage—and with Kitchen Hub we have people who do other cuisines really well. By providing that kitchen space to them, we’re providing our guests the ability to go pick up a ready-to-go meal and either eat it in our restaurant or take it home. Kitchen Hub has been very popular, so much so that we’re putting in Kitchen Hub at our newly renovated Maple location. We’re really excited about trying that [concept] in a very different market than Liberty Village.
Can you tell us more about Longo’s recent expansions and what else is in the works?
We opened the Brooklin [Whitby] store in July—we’re loving that community. And we’ve completed renovations on a number of our stores in the last year— M a r k h a m , M a p l e, M i l t o n a n d o u r
Rutherford store. In Mississauga, we have our Argentia [Road] store coming in the spring—it will be our fifth store in Mississauga. The location was a Bed Bath & Beyond previously and we’re in the process of remodelling it. And we’ve broken ground on our new Kitchener store [to open in 2025]. It’s a new community for us that we’re really excited to be joining. It’s a community that maybe hasn’t been as aware of the Longo’s name, so we’re really excited to be moving into that geography. Then there are other locations we’re working on—we just haven’t signed leases yet for those.
There’s a lot of love for the Longo’s brand—it regularly appears on Leger’s WOW list of best in-store experiences. What does that recognition mean to you and how do you court customers in a very competitive marketplace?
Yeah, it is everything. We work hard all year long to try to create these amazing guest experiences. It is one of the core KPIs that we use to measure ourselves as a company. And a big piece of it is that you’ve got to listen to your guests to really get them. So, there’s input that we’re getting through rating scores guests are providing, Google reviews, all of that. And then our guests provide us with feedback every single day, whether it’s calls into our guest care centre or emails they’re sending us, and we get a summary every week of every guest comment and I read through every single one of those. I’m constantly looking for the great feedback and what we want to make sure we continue doing, and also what we can be doing better. All those guest voices are heard.
Keeping employees engaged is something retailers struggle with—how is Longo’s tackling this?
Culture is another thing that we keep very top of mind. We just did our full employee engagement survey. We do it every single year and typically we get a survey back and get a bunch of numbers that say, “Here’s your team’s engagement level.” Okay, that’s great, but it’s just telling us numbers. Liz Volk, our chief HR officer, said “You know what? I think we need to dig a little bit deeper. Let’s find out what’s behind those numbers.” So, she asked me—and this was before I got this new role—if I’d be interested in doing “listening sessions” with team members, and we saw an opportunity to hear from our distribution centre and supply chain teams. They had been through the ringer going
through a huge expansion, so we started listening sessions with these team members. None of their managers or supervisors were involved, it was just Liz and I, and we said, “please share with us the good, the bad, what you would change and what you want to make sure we never change.” And they just completely opened up to us, and we left that session with, “Wow, okay, so now we understand what’s behind the numbers.” And then we looked at the actions we could take, and we now update the team members quarterly and communicate to them: “Here are the actions that have been acted on, check! Here are the ones that we’re currently working on, check! Here’s the ETA for those other ones, and then here are ones that we think are just going to take a little bit longer. So, we don’t have an update yet, but they have not fallen off our radar.” It worked out really well. We did the same thing with our department managers in the stores. We had those same sessions. It’s just so eye-opening to think, “OK, wow. I didn’t know that was something our stores were struggling with. Well, we can do something about that.” The sessions have been so successful [they’ve been extended to most departments] and we’ve seen significant improvement in the engagement survey we just completed with the DC team. We’re so proud to see that.
environment to work in. You’ve got different temperatures, you’ve got all that fresh product. So, if you expand and double the size of the DC, finding team members who will join the organization and do that very difficult job, it’s a challenge. So, we’re putting in light automation that will enable team members to do their job more easily, safely and more efficiently and that will, ultimately, provide the best service possible to the stores and then to guests. We will not be eliminating any positions with the expansion—putting automation in is about making sure the team members that we have and the ones we’ll be adding have those tools to service the stores the best.
Technology is on everyone’s mind—how do you know where to put resources to get the best bang for your buck?
Finally, what excites you about the grocery industry right now?
Whatever investment we make, it goes without saying, is going to have to have that payback. I’d say the big focus area right now for us is that we have so much data, but we have not figured out—and everybody struggles with this—how to use that data to turn it into insights. So, we’ve identified a high performer within the organization, and we’ve asked her to take a crack at this and look at what we need to do to make sure all that data we have can help us make stronger decisions. And what do we need to do to make sure the data is clean and usable? She’s just starting to get us organized on that. I think it’s going to help us, because that sets the foundation for being able to use AI, but you can’t use it if your data isn’t in good enough shape. So that’s something that’s taking up a lot of our brain space right now, in terms of how we do that and where are those important pockets of data. The other area is our investment in automation in the DC. It is a challenging
You joined Longo’s prior to the Empire deal (in 2021). How has the partnership helped Longo’s?
We’ve always called it a partnership and it has turned out to be an incredibly strong partnership. We have access to some incredible best-in-class resources. If we’ve got a question or have a challenge in any given area, we know we’ve got team members there we can bounce things off who are very smart, who have probably seen this and have access to resources we might not have the same access to, like cybersecurity or IT, for example. And obviously the relationships with vendors and the buying power that comes with that.
I think what excites me is that there’s still so much growth to be had. Just when you think, “Oh, are there any more new markets?” The population keeps growing in Ontario, which is fantastic. So, there’s just all these new opportunities to be able to do what we do really well and have that be impactful to a growing and really diverse population in Ontario. I’m excited about our expansion outside of the GTA [Greater Toronto Area], and what opportunities that can provide. And I’m really excited about the opportunities our expanded DC is going to give us. I think we’re just scratching the surface with what some of the automation and tools are going to provide; what it’s going to be able to do to serve our stores better, serve our guests better, be better partners with our vendors. We probably don’t fully understand all the benefits that we’re going to realize from that. Also, what’s ahead of us in terms of the service opportunities we can provide to our guests. We’ve got a lot on our plate—there’s never a boring day. CG
February 2024 || CANADIAN GROCER 29
4
Shopper research
SHOPPERS SPEAK
UP
Our exclusive research takes the pulse of grocery shoppers in Canada By Shellee Fitzgerald Illustrations by Carole Hénaff
F
ROM WHERE THEY’RE BUYING GROCERIES to what’s in their basket, their biggest
pet peeves at the store and much more, we teamed up with the research group at EnsembleIQ (Canadian Grocer’s parent) to get a handle on how Canadians size up the grocery shopping experience. Shoppers all across the country were surveyed to bring you our fourth-annual 2024 Grocery IQ Study: Taking Stock of Grocery Shopper Attitudes and Behaviours. Here are some highlights from the study:
February 2024 || CANADIAN GROCER 31
Shopper research FEELING SQUEEZED
Cost-conscious shoppers are continuing to shift away from traditional chain grocery stores. Shop at store once/week or more
54%
Discount chain grocery store
Ontario shoppers (69%) Quebec shoppers (69%) 9% never shop
Grocery shopping frequency by store type
49%
Traditional chain grocery store
-7pts
STICKING WITH DISCOUNT Saddled with household debt and still struggling with the high cost of living, it’s no surprise that to cope, Canadians are adjusting their behaviour, and that includes how they shop for groceries. In fact, the latest edition of our Grocery IQ Study finds that shoppers in Canada are continuing to shift away from traditional grocery, with just 49% of shoppers surveyed reporting they shop at these stores at least once a week; this is down 7% from last year (and down 14% from our 2022 study). To stretch their dollars, 54% of shoppers are sticking with discount grocery stores, which are proving even more popular with shoppers in Ontario and Quebec, where 69% of shoppers in these provinces say they visit discounters once a week or more. Supercentres/mass merchandisers, independent grocers, dollar stores and ethnic grocery stores all experienced a slight lift in terms of the
Drug Dollar
Quebec shoppers (57%) 5% never shop
44%
Also decreased 7 pts in last year’s study
27% 11% 26% 10% 20%
Convenience store
28% 16%
Club
25%
Local independent (butcher, fishmonger, fruit market etc.)
Supercentre/mass merchandiser
7% never shop
14% 26% 16%
Online stores
20%
Ethnic grocery
Independent grocery store
Specialty/ natural store
30% never shop
36% 10%
+3pts
47% 7% 44%
Shop once/week+
Never shop
Statistically significantly higher/lower at the 95% confidence level versus last year
number of people shopping them at least once a week, compared to last year. With shoppers feeling squeezed financially, it makes sense that for 82% of survey respondents, price remains the most important consideration when deciding where to shop (90% of boomers said it’s the most important factor). Although
shoppers appear to be laser-focused on price, factors such as product quality and freshness held steady at 75% and 74%, respectively. Interestingly, among survey respondents, factors such as convenient location, variety of products available, and speed of the shopping trip have dropped in importance year over year.
TOP FACTORS WHEN CHOOSING A GROCERY STORE
Price remains the top factor when deciding where to shop for groceries. Highest subgroup scores
% selecting factor as important when choosing a grocery store 82%
Price Product quality
75%
Freshness
74% 71%
Sales/promotions 67%
In-stock
64%
Convenient location
61%
Variety Cleanliness
56%
Rewards/loyalty program
-7pts
41%
Helpful/friendly employees
38%
Large selection of local products
-7pts
36%
Organization of store
33%
Speed of shopping trip
32 CANADIAN GROCER || February 2024
-8pts
-7pts
50%
Brands offered
Healthy/better-for-you products
-8pts
29% 25%
-7pts
-12pts
Statistically significantly higher/lower at the 95% confidence level versus last year
Boomers (90%) score “price” significantly higher than all other generations. Female shoppers score the following factors significantly higher in importance than male shoppers: In-stock Rewards/loyalty program Sales/promotions Freshness Product quality Variety Convenient location Cleanliness Healthy/better-for-you products Commitment to sustainable practices
DEFINING VALUE
What does the word “value” mean to grocery shoppers? “In their own words”
“As a grocery shopper, ‘value’ to me means a balance between quality and price. It’s about getting good quality products at a reasonable cost, considering factors like freshness, taste, nutritional value and overall satisfaction for the money spent.”
“A great product and a great price that will allow me to feed my family and save a little money.”
“Best bang for your buck.”
“DEALS ON GROCERIES. CHEAPER THAN THE MAINSTREAM.”
“Saving money.”
“Same price as before the pandemic.”
“Products are of the highest quality and take into account moral, human and environmental values.”
“Good prices and freshness.”
WHAT IRKS GROCERY SHOPPERS
Shoppers want better prices, well-stocked shelves and faster checkout lines. Areas of improvement for grocery store shopped most often Nothing
19%
Price
15%
Out-of-stocks
13%
Checkout lines/more cashiers
13%
Store layout
7%
Product variety
7%
Customer service
“In their own words”
“Prices keep going up every week.” “Price gouging. This store’s prices are about $3 higher on items than other stores.”
SIZING UP THE STORE When asked to rate the performance of the store they shop at most often, overall, shoppers felt about the same as they did last year. In terms of such things as cleanliness and variety of products on offer, 60% of shoppers said their store was doing an excellent job and, compared to last year, shoppers surveyed were slightly more satisfied with employee friendliness/helpfulness. And while the good news is that 19% of shoppers said they wouldn’t change anything about their primary store, 15% said grocers need to do a better job on price. In verbatims captured, survey respondents complained of “prices going up every week” and “price gouging,” suggesting grocers have work to do when it comes to explaining their prices to customers. Other things that irk shoppers are out-ofstock items, long checkout lines and not enough cashiers at the store. LOCKING IN LOYALTY As the battle to win customer loyalty plays out, grocers continue to tinker with their programs in hopes of keeping customers engaged, rewarded and coming through the door again and again. And grocers are getting creative with things such as subscription models, finding ways to reward customers beyond groceries and through gamification to woo younger shoppers. So, what do shoppers think of these measures? According to the study, awareness and enrolment of loyalty programs increased to 69% (from 67% last year), with 93% of those currently enrolled in a program expressing some level of satisfaction with it. It’s worth noting, however, that the number of shoppers indicating they are “extremely/very satisfied” with their
6%
Crowded
3%
Loyalty program
3%
Cleanliness
3%
More promotions
3%
Produce
2%
Meat
2%
Don’t like self-checkout
2%
Parking
2%
“Keeping shelves stocked with products, especially sale items.” “It’s becoming harder and harder to find items in the store; they are not available or the particular brand is sold out.”
“Have more checkouts with cashiers. The self-checkouts are fine if you only have a few items but to check through a large order is very inconvenient.”
“My biggest pet peeve is lineups, few cashiers open to accommodate lines, and the self-checkouts that take jobs from people.”
February 2024 || CANADIAN GROCER 33
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Shopper research SIZING UP LOYALTY PROGRAMS
While more shoppers are enrolled and actively use a loyalty program, satisfaction with these programs has declined. Awareness and enrolment in grocery store loyalty program
Satisfaction with grocery store loyalty program
Don’t know 6%
Scores
Would not enrol even if they did 2%
-8pts
If they did I would enrol 10%
82%
I am not enrolled 8%
of grocery stores shopped most often offer a loyalty program
I am enrolled but do not use 5%
Boomers (77%) are significantly more likely to be actively enrolled in a loyalty program than all other generations.
Extremely/very satisfied 54%
Somewhat satisfied 39%
Quebec shoppers (82%) are significantly more likely to be actively enrolled than most other regions.
+7pts
I am enrolled and actively use 69%
93% +7pts
Not very/not at all satisfied 8%
BRICKS AND CLICKS
Online shopping continues to grow with significant gains in contactless delivery and in-store pickup. Average % of shopping trips where purchase method was used in the last month
86%
Shopping in-store
% who used method in the past month
98%
Satisfaction with online grocery shopping experience
4%
4%
Buy online for contactless delivery
3%
Buy online for in-person delivery
Buy online for curbside delivery
18%
14%
17% +4pts
-8pts
Fees are too expensive
44% 33%
Unhappy with product substitutions
31%
Unhappy with quality of products
19%
Order was picked up incorrectly
18%
Wait times for curbside pickup are too long +9pts
Somewhat satisfied 45%
Not very/not at all satisfied 10%
14% +4pts
Reasons for not being completely satisfied with online grocery shopping Product(s) I needed were out-of-stock
Completely/very satisfied 45%
3%
Buy online for in-store pickup
15%
Process is too complicated
13%
Pickup/delivery window was too far out
12%
Store does not offer delivery
9%
Unhappy with the customer service provided
7%
Store does not offer curbside pickup
7%
Other
9%
Statistically significantly higher/lower at the 95% confidence level versus last year
Fewer shoppers are “completely satisfied” with the online experience
store’s loyalty program fell significantly to 54% this year, compared to 61% last year. Why the drop in satisfaction? Respondents said it had become harder to earn points with the program they’re enrolled in and that there were fewer discounts and bonus offers available. When asked what features of a store loyalty program they find most valuable, reward points that can be redeemed for groceries topped the list with 68% of respondents. Exclusive loyalty member discounts, however, increased significantly with this feature, appealing to 46% of shoppers, up from 40% last year, presenting an opportunity for grocers to use this as a retention tool. Overall, 36% of shoppers said cash back on purchases was the most valuable feature, but among Quebeckers this ranked significantly higher at 55%. And what about flyers? It will surprise no one that in the digital age, paper flyers continue to lose relevance; in fact, just 34% of shoppers said they look at paper flyers before heading to the store, that’s down 9% from last year. While 50% said they look at digital flyers prior to shopping, it’s worth noting that a growing number of shoppers (21% versus 17% last year) don’t use flyers whatsoever. BRICKS RULE, BUT CLICKS GROW While physical stores continue to be the preferred place for procuring groceries, with 98% of survey respondents saying they’ve shopped in-store in the past month (edging up slightly from 97% last year), online options are also seeing gains. Contactless delivery, for instance, was used by 17% of shoppers in the past month (up 4%), while in-store pickup was used by 14% (also up 4%). Although more shoppers are purchasing groceries online, they’re not all happy with the experience.
February 2024 || CANADIAN GROCER 35
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Shopper research SHOPPING BEHAVIOUR TODAY AND TOMORROW
WHAT’S ON THE LIST?
Significant declines for dairy, frozen foods, coffee and pop versus last year. Food categories purchased at the grocery store in the past month
Although half of shoppers predict they will continue to cook mostly from scratch, more will consider convenience meals in 2024 compared to a year ago. Strict meal plan
24%
Fresh produce
83%
Dairy
82%
Bread/bakery items
77%
Fresh meat/seafood
69%
Salty snacks
33%
67%
Frozen foods
57%
Cereal
57%
Juice
56%
Shelf stable grains
55%
Cooking fats (oil, butter) 32%
Spontaneous meal plan
44%
Today
37%
Cooking from scratch
55%
55%
29%
23%
26%
Coffee
50%
Confectionery
49%
Baking supplies
49%
Deli meat
48%
Pop
46%
Frozen desserts
45%
Convenient meals 39%
39%
37%
22%
19%
Today
Predicted
-6pts
-9pts
-6pts
45%
Prepared food
40%
Water Spend much more on groceries
-6pts
51%
Canned vegetables/fruits
Predicted
33%
-5pts
+4pts
Among non-food categories, monthly purchases of OTC medications have decreased while other categories remain stable. Non-food categories purchased at the grocery store in the past month
40% Paper products
Spend much less on groceries
22%
Today
23%
Predicted
Agree more with statement on top Neutral Agree more with statement on bottom
Highest subgroup scores Females are significantly more likely than males to predict they will cook more from scratch (60%). Quebec shoppers are significantly more likely than other regions to predict they will spend less on groceries (34%).
Our survey revealed just 45% of shoppers were completely satisfied with the online experience, a drop of 8% over last year; another 45% are somewhat satisfied, while 10% are not at all satisfied. The top reasons for dissatisfaction include expensive fees, out-of-stocks, product substitutions and product quality. Survey respondents also complained of “forced tipping without the option to adjust,” “messy websites” that were difficult to
-3pts -4pts
59% 52%
Personal care products Laundry detergent
50%
Personal/household sanitizing products
41%
Prescription medication
29%
OTC medication
28%
Beauty products Pet supplies (excluding food) Flowers/plants Books/magazines
14% 10% 8%
Toys/games
8%
Office supplies
7%
Diapers/baby supplies
6%
None of the above
-4pts
22%
11%
navigate, and not being able to use coupons or price matching promotions when shopping online. Looking ahead, we asked shoppers to anticipate how they think they’ll be shopping a year from now. Generally, they said they expect to follow the same grocery shopping patterns, although 22% said they expect to shop more in-store and 7% indicated they’d be opting more for contactless delivery of their groceries.
Statistically significantly higher/lower at the 95% confidence level versus last year
MAKING A LIST … Perhaps to keep themselves on track and on budget, most shoppers head to the grocery store armed with a list. In fact, 17% make a list and stick to it, while 64% have a list, but go off-list, purchasing additional items. Another 17% don’t make a list, but have a rough idea of what they’ll purchase at the store, and 2% of shoppers completely wing it, deciding what to purchase in-aisle.
February 2024 || CANADIAN GROCER 37
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Shopper research Despite inflation, shoppers said they spent, on average, $114 on their most recent grocery trip, consistent with last year. However, eight in 10 shoppers said they have changed their shopping behaviour in some way to cope with the sting of rising food prices. Among the top strategies shoppers are employing include: buying items on reduced price/clearance (50%), fewer impulse purchases (44%), buying less groceries overall (37%) and shopping more frequently at discount grocery stores (31%). Meanwhile, just 18% said they had not changed their shopping behaviours in any way. Purchasing private-label products is another way shoppers can potentially stretch their dollars and 89% of shoppers surveyed said they purchase these items always or sometimes. Saving money is one motivation (for 71% of shoppers), but 48% believe the quality of private-label products to be similar to name brands, while 18% (up 4%) think store brands are of better quality than the name brand equivalent—another opportunity for grocers as they expand their private-label programs to better manage operational costs. So, what’s in the basket? Despite the average spend at grocery remaining consistent, there are some shifts when it comes to what’s ending up in shoppers’ carts in the past month. The survey revealed declines in fresh produce (83% versus 86% last year), dairy (82% versus 86%), frozen foods (57% versus 63%) and coffee (50% versus 59%). Interestingly, affordable luxuries like confectionery that enjoyed big gains last year saw a slight decline among survey respondents this year. Among non-edible categories purchased at grocery stores, top items such as paper, personal care products and laundry detergent remain stable; however, overthe-counter medication has dropped significantly in monthly purchase incidence (28% versus 32% last year). When we asked shoppers if there were additional products or services they’d like their primary store to offer, most (71%) indicated no, while 29% (up from 22% last year) said they would like to see some extras. These shoppers listed alcohol, a pharmacy, an in-store restaurant or a café as items they’d like to see offered at their grocery store.
INFLATION, INFLATION, INFLATION
More than 8-in-10 have changed their grocery shopping behaviour to cope with inflation. Coping strategies include buying clearance items, less impulse buys and purchasing fewer groceries, overall. Changes in grocery shopping to cope with inflation Buying items on reduced price/clearance
50%
Buying fewer impulse items
44%
Buying fewer groceries in general
37%
Shopping more often at discount grocery stores
31% 30%
Buying more private label/store brand products Buying fewer prepared foods Buying bulk packs
23%
Buying fewer fresh produce items
22% 22%
Using more coupons
20%
Buying cheaper animal proteins Buying more plant proteins Other
Shoppers spent, on average, $114 on most recent grocery trip, consistent with last year, suggesting that shoppers are managing their budgets.
-4pts
11% 1%
Have not changed my grocery store shopping behaviour due to rising prices/inflation
HOW BIG IS THE BASKET?
-5pts
26%
18%
Total spend on most recent grocery trip
5%
$200+
2% 12%
$150-$199.99
15% 14%
$100-$149.99 $50-$99.99 $25-$49.99
29%
Less than $25 23%
Don’t know
$114 Average
February 2024 || CANADIAN GROCER 39
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Shopper research AN APPETITE FOR PREPARED FOODS When restaurants were shuttered during the pandemic, consumers turned to grocers for prepared meals. Nearly four years on, cost-conscious consumers and those with busy routines are still hungry for grocery store prepared meals. In fact, our survey found that more shoppers (66% versus 63% last year) are purchasing prepared food at the grocery store and they’re doing so, on average, twice a month. Although many grocers have upped their game in this crucial area, there’s still work to do to woo the nearly one-third of shoppers who are not currently purchasing prepared foods. When we asked these shoppers why they’re not buying these foods, for 51% it came down to price—they think they’re too expensive. Among the other reasons: 44% prefer not to purchase prepared food at a grocery store/prefer to cook at home, 31% said they didn’t plan to purchase prepared food when they went to the store, 13% (up 6%) said the food on offer didn’t look appetizing, while 9% said there weren’t any healthy food options. Entrees (pizza, fried chicken, rotisserie, sushi, etc.) were purchased by 62% of shoppers, making them, by far, the most popular offering. From a demographic standpoint, boomers (72%) are significantly more likely than all other age groups to buy prepared entrees. Other popular items include baked goods (prepared in store), which were purchased by 30% of shoppers, and prepared hot sides, which were purchased by 21%. It’s worth mentioning that only 53% of prepared food shoppers said they were completely satisfied with their purchase. This is a 10% drop from last year, suggesting there’s an opportunity for grocers to improve their offerings and deliver on price, quality, freshness and taste—the most important considerations for shoppers in this category. While dinner remains the most popular time for prepared food purchases, lunch is making gains, with 24% of shoppers (up 5%) buying prepared food during this daypart. Interestingly, this number is significantly higher in Quebec, where 37% of shoppers are making lunchtime purchases, a potential growth area for grocers. And although 74% of shoppers are eating purchased prepared food at home, there continues to be a shift to outof-home consumption, with 26% of shoppers (up from 20% last year) either eating their purchases in the store, at work, in their car or at school.
AN APPETITE FOR PREPARED FOOD
Two-thirds of shoppers purchased prepared food in the past month, but barriers persist.
66%
Purchased prepared food at a grocery store in the past month
2.0 Average prepared food purchase occasions in the past month
Reasons for not purchasing prepared food Too expensive Prefer not to purchase prepared food at a grocery store/prefer to cook at home I didn’t plan to purchase prepared food when I went to the store Didn’t look appetizing
51% 44% 31% 13%
There weren’t healthy food choices
+6pts
9%
Didn’t like selection
8%
Wasn’t hungry when I was in the store
6%
Other
7%
Top five factors shoppers consider when purchasing prepared food. 1
Price/value 64%
2
Food quality 56%
3
Freshness 52%
4
Taste 49%
5
Portion size 22%
Female shoppers (56%) are significantly more likely than male shoppers to select “freshness” as a top factor. Boomers (66%) are significantly more likely than all other age groups to select “freshness” as a top factor.
Despite a decline versus last year, dinner remains the most popular daypart for prepared food purchases, but lunch is gaining steam.
24% 3%
2%
Breakfast
Morning snack
Highest subgroup scores
55%
Meal or snack occasion when prepared food was last purchased at grocery store
+5pts
7% Lunch
Afternoon snack
-9pts
6% Dinner
Evening snack
0% Late night
February 2024 || CANADIAN GROCER 41
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Shopper research HEALTH AND WELLNESS
SHOPPERS AND SUSTAINABILITY
Fewer shoppers identify as health conscious, compared to last year.
Importance of stores demonstrating commitment to sustainability practices. Really important
68% of shoppers agree with the statement: “I am healthconscious”
Not concerned
Don’t know
Donate food instead of throwing out
53%
Locally sourced produce/animal products
38%
42%
13%
8%
Movement towards zero waste
37%
39%
15%
8%
Highest subgroup scores
-5pts
Somewhat important
Recycling containers
39%
Ethical sourcing
34%
Gen X: 69%
Energy-efficient equipment/fixtures
26%
Boomers: 73%
EV charging stations
15%
-4pts
31%
38% 38% 41% 21%
10% 6%
14%
9%
17%
11%
23%
11%
51%
13%
Quebec: 78% Statistically significantly higher/lower at the 95% confidence level versus last year
Shoppers’ health and wellness top interests and concerns % indicating concern or interest in health-related aspect Fresh
46%
Sugar
32% 26%
Sodium Non-processed
25%
Calories
23%
Protein
22%
Locally sourced/produced
21%
Fat
20%
All-natural Ingredients I can understand and pronounce
19% 18% 16%
Non-GMO 14%
Artificial sweeteners
13%
Carbohydrates
12%
Antioxidants Growth hormones
11%
Artificial flavours
11% 10%
Immunity boosting
9%
Antibiotics Caffeine
8% 7%
Vegan/plant-based Functional/vitamin-enhanced
-4pts
Highest subgroup scores Boomers (56%) are the most likely age group to find “fresh” to be an appealing claim. Millennials (21%) are the most likely age group to find “antioxidants” to be an appealing claim.
5%
Gluten
5%
Keto-friendly
3%
Other
3%
HEALTH AND SUSTAINABILITY The number of shoppers who identified as “health conscious” dropped to 68% this year, from 73% the last two years. There are notable regional and generational differences to note, however, as 78% of Quebeckers identify as health conscious, along with 73% of boomers and 69% of gen Xers. The good news for grocers is that 90% of shoppers expressed some level of satisfaction with
Statistically significantly higher/lower at the 95% confidence level versus last year
the selection of healthy/better-for-you options available at their grocery store, which has remained stable. When asked specifically about what health-focused offerings at grocery they deemed valuable, an in-store pharmacy was valuable to 29% of shoppers, healthy recipe cards at shelf (21%), free in-store health magazine (17%), health care app, healthy cooking classes (each of value to 11% of shoppers) and in-store dietitian (10%).
When it comes to the health of the planet, shoppers continue to want grocers to demonstrate a commitment to sustainability. For 84% of shoppers donating food instead of tossing it out is important, while 80% said locally sourced produce/animal products was important and 76% said it was important for grocers to show progress towards zero waste. And while 60% of shoppers said they are at least somewhat likely to switch to another store if it was more committed to sustainability, 45% of these potential switchers said they’d be willing to pay a bit more for a more sustainable store, while 41% said they would not. For the latter, perhaps it’s a sign of the times; they want to shop sustainably, but higher prices aren’t an option. CG
Overview & Methodology
• Survey sample: 1,000 grocery shoppers • Respondents were required to be age 18+, reside in Canada, shop at grocery stores at least once a month and are the primary or shared decision-maker for household grocery shopping • Quotas were established by province/ territory to accurately represent the population distribution of Canada
February 2024 || CANADIAN GROCER 43
SEVEN HEALTH AND WELLNESS TRENDS TO WATCH Across the board, consumers are turning to grocery retailers as key allies in healthy living
NOT ONLY IS LIVING HEALTHIER a bigger priority for the majority of consumers these days, but more and more of us are putting faith in our food providers to support us along the way. According to The Power of Health and Well-Being in the Food Industry 2023 report from the Food Industry Association (FMI), shoppers’ trust in grocers and other food stores to support their personal goals to stay healthy is growing. Now, half of consumers (up from 46% in 2022) say they trust their primary food stores to be allies in their health journey—more than government agencies or food manufacturers. “Especially in today’s age of having data at our fingertips and there being so much misinformation out there, this value consumers place in the grocery store is a great thing,” says Krystal Register, a registered dietitian and FMI’s senior director of 44 CANADIAN GROCER || February 2024
health and well-being. After all, she says grocers are in a unique position to be a one-stop shop in connecting shoppers with registered dietitians and optimal food choices. For Canadian grocers—especially those who haven’t yet made health and wellness a key part of their business strategy—this signals a real opportunity to draw loyal customers, say industry analysts. And if that’s not enough incentive, the latest statistics from the non-profit Global Wellness Institute show that the global wellness market is surging in the post-pandemic era and is expected to reach US$8.5 trillion by 2027 (almost double the growth from 2020). Here’s a look at some of the biggest trends in health and wellness expected for this year and beyond—and how grocers can become the consumer’s ultimate health ally.
SHUTTERSTOCK/KSANAGRAPHICA
By Rosalind Stefanac
Health and wellness
1
Nutrition on a budget
Consumers want to eat well even when their spending is limited, and they want grocers to guide them to those budget-friendly choices. “There really are nutritious, affordable options around the entire grocery store that can land you in the canned bean aisle or in frozen fruits, vegetables or seafood,” explains FMI’s Register. Any tips grocers can offer shoppers through in-store programs or on their websites on how to eat healthier— and reduce waste—while spending less will be appreciated this year. “When we asked people why they weren’t eating healthy all of the time, the No. 1 reason was cost,” says Joel Gregoire, associate director, food and drink at Mintel. “Accessibility is an important thing to consider, and as a grocer you can convey value by being a place where people know they can eat healthy at a reasonable price.”
2
Wellness across the ages
The latest research from Mintel’s 2024 Global Food & Drink Trends report shows consumers are putting a priority on living well longer. Generation X (ages 44 to 58), in particular, is leading the charge by openly discussing once-taboo subjects such as menopause. As 76% of Canadian gen Xers worry about illness associated with aging, brands are expected to play a key role in helping guide them through transitional periods of middle age over the next 12 months. Not surprising, the motivation for eating healthy differs across the ages, says Gregoire. Whereas older generations may be concerned with high sodium or excess sugar, younger generations are motivated by food and drink that can enhance physical or mental performance. “So, if I was trying to appeal to a younger demographic, saying something is low in sodium is not going to be relatable,” he says. As healthy living becomes a priority, Aaron Skelton, president and CEO of the Canadian Health Food Association, says people are turning to natural products more and more. “We just did a study that showed 80% of Canadians are using natural health products on a regular basis,” he says. “These are people looking to take control of their health and they’re finding different, unique ways to do that.”
3
Sustainable shopping
Those seeking a more holistic health and wellness lifestyle are also concerned about their environmental impact. An emerging type of consumer is the “everyday activist” who sees themselves as a catalyst for change, says Skelton. “They see that small changes can have a compounded impact on the environment ... they want to buy from companies walking the talk,” he says, adding that this includes their grocers.
Another buzzword expected to gain momentum in 2024 is “rewilding,” or letting nature take its course, says Skelton. “As people are trying to embrace living a longer, healthier life it’s not so much about reducing their footprint, but how are you supporting filling it in.” That applies to suppliers looking to source their supply chain from farm to final product, but also to grocers putting more emphasis on regenerative farming and refillable, more sustainable packaging. “Our shoppers are more environmentally conscious than ever,” says Anthony D’Addario, vice-president of purchasing and merchandising at Ontario-based chain Nature’s Emporium. “They expect grocers to demonstrate a commitment to sustainability, whether it’s through offering more eco-friendly products, reducing waste, or supporting sustainable farming practices.” To that end, D’Addario says Nature’s Emporium is transparent in providing clear and honest information about its products so “customers can shop with confidence and be empowered about their purchasing decisions.”
Weight-loss is top of mind
4
In a recent NielsenIQ webinar, vice-president of wellness Sherry Frey spoke of the growing rate of obesity across the United States and globally. “[In research panels] this past year, we have seen a doubling of the number of households who said they were obese and overweight and were taking a weight-loss drug,” she said. Along with an uptick in products with claims around metabolism support, there is ongoing interest in obesity support and weight-management supplements. The increasing popularity of GLP-1 agonists (medications such as Ozempic and Wegovy) that suppress appetite, is also helping destigmatize conversations around obesity, says Frey. “It’s taking it out of this idea that [controlling weight] is just about willpower and eating better with fewer calories, to the reality that this is actually a chronic disease that needs to be managed.” For grocers, it’s important to think about how to support these consumers who may be eating less, but still want to make their meals as nutrient-packed as possible.
5
Personalized health education
While there may have been a decline of nutritionists, dietitians and other experts in-store during the pandemic, the trend towards more personalized group or oneon-one health and wellness education is expected to re-emerge, both in person and through virtual programs and social media. FMI’s report showed that 41% of shoppers noted the availability of nutrition and health information as one of the most important attributes in their primary food store. FMI’s Register says the grocery store lends itself well to personalized health education because it can connect experts with customers at the point-of-purchase where they are making the majority of their food decisions. A big opportunity in using retail registered dietitians, for example, is being able to provide nutrition therapy specific to disease management. They can also work with retail pharmacists to provide direct access to healthcare services such as flu shots, blood pressure monitoring and diabetes support. Providing free health and wellness programs for customers
February 2024 || CANADIAN GROCER 45
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Health and wellness
at Community Natural Foods locations in Alberta has proven extremely popular, says Matt Penner, the store’s director of operations and merchandising. “We have a 21-day kick-sugar program in-store right now that goes along with five webinars and a personalized store tour to help you through that New Year reset,” he explains. “Our team members are always available to take people looking to eat differently throughout the store to show them different products.” At all Nature’s Emporium stores, there are holistic nutritionists and certified wellness experts on hand to offer advice and personalized recommendations. This year, there are also plans for events offering specialized advice and practical strategies on topics such as women’s health and immune system support.
6
Using technology for healthier food choices
Digital tools are gaining favour as another way to personalize the grocery experience to improve healthy food choices. “Technology is anticipated to incentivize a more targeted approach to well-being,” says Simona Bernatonyte, a consultant at Euromonitor International. “Grocers prepared to invest in the digital wellness space will reap the benefits of this, including gauging the attention of techsavvy consumers who want to take their nutrition and well-being care one step further.” The K-Ruoka app, developed by Finland supermarket chain Kesko, is a good example, says Bernatonyte. Once customers download the app, they can set personal wellness goals—such as eating more fibre or using more good fats—and get recommended products and recipes to support them. “Development and adoption of such applications may greatly benefit the grocer itself, as such data will better inform the business about the trends of health-conscious consumers,” she says. On a similar note, U.S.-based grocery chain Albertsons added a nutrition function to its Sincerely Health app last year that offers realtime nutritional information and rewards customers for healthy lifestyle choices. Loblaw made similar moves in 2020 with the launch of its PC Health app. As generative artificial intelligence becomes more and more prevalent, it could be an important tool for addressing consumers’ health and wellness needs, says Mintel’s Gregoire. As an example, he points to the chat function on a grocer’s website that could link to a product assortment based on a person’s health and wellness queries. “The question is whether it can make people more aware of things they might not have considered otherwise, such as certain healthy ingredients or recipes,” he says. “I believe the role that AI is going to have in our lives as a go-to for a lot of answers is only going to increase.”
Food as medicine
7
Research from Euromonitor International points to a growing number of “wellness pragmatists” in 2024, who are looking for products backed by proven clinical efficacy to enhance their bodies and minds. The data shows that half are looking to treat or prevent sleep problems and target weight-management, while 47% want to address mental health and 46% are looking to skin health. These consumers prefer effective remedies that easily fit into their lifestyle without too much time or effort and expect brands to show the benefits of usage to gain credibility. For grocers, that means first understanding the wellness goals of their shoppers to determine where to invest, then creating easy solutions that use existing products within the store. Euromonitor suggests using verified claims, demos or testimonials (or other methods such as expert staff or technology) to help educate shoppers on product benefits and claims. Over the course of this whole decade, consumers will be looking to food and beverages to be a “major means of improving one’s cognitive abilities” across age groups, says Karine Dussimon, industry manager at Euromonitor International. “As links between the brain and compounds—such as fibre and protein, ingredients like B vitamins and even metabolic states such as ketosis—become more widely understood, there will be a flourishing of health claims associated with these insights.” Dussimon says this concept of food as medicine is the driving force behind “the unabated growth in health and wellness sales” that’s even partially offsetting mounting economic pressures worldwide. Along with cognition, another key area trending is women’s health. “The rising awareness of products, which specifically benefit women, opens vast opportunities,” she says, noting that brand owners can learn how to build success around women’s biological life stages. NeilsenIQ’s Frey says one of those stages gaining particular attention this year is menopause. With so many issues around menopause that women are struggling with, she says most of the growth is actually happening at the nutrient level rather than through product claims. And it’s not just women in their 50s either, she adds. “We’re seeing millennials starting to enter perimenopause … so it’s a large subset of consumers who are facing this.” When it comes to promoting food as medicine in grocery, Penner says there are plenty of opportunities to showcase foods that are boosted with micronutrients. “What we’ve been doing in both our cafes and food areas at Community Natural Foods are elixir shots,” he says. “They’ve been used for improving immunity and [as a] detox in the past, but now they’re trending into other areas of [improving] skin, sleep, energy and stress.” CG
February 2024 || CANADIAN GROCER 47
UNIQUE INDONESIAN BRANDS
SHAKE UP THE SNACK AISLE Elementary Produce introduces new healthy-snack brands: Woh Tempeh Chips and MomChipz Fruit & Veggie Chips Two new-to-Canada brands will help grocers make the most of the healthy-snacking opportunity. Toronto-based Elementary Produce is bringing Woh Tempeh Chips and MomChipz to the Canadian market all the way from Indonesia. The products, made and imported by Exotique Foods Inc., give consumers unique and healthy snacking options, along with the diverse flavours Canadians crave. “As soon as I tried the prodAnthony Pronesti, Adam Rizzuto and Daniel Morra ucts, I knew we were onto something different,” says Adam Rizzuto, President at Elementary ficial colours. Fruit chips come in six Produce, the brands’ sole distributor in varieties: Jackfruit, Snake Fruit, PineCanada. Rizzuto discovered Woh and apple, Apple, Mango, and Banana. MomChipz at the SIAL Canada show Veggie chips are available in six vain Montreal in 2022, and – along with rieties: Broccoli Florets & Cauliflower, his partners Anthony Pronesti and Cassava, Onion, Bell Peppers, Sweet Daniel Morra – spent the past year Potato, and Taro. Both Woh Tempeh and a half working to bring the prodChips and MomChipz are certified ucts to Canadian grocery shelves. vegan and non-GMO, and come in resealable, 70-gram (Woh) and 85What’s special about these new gram (MomChipz) bags. offerings? Woh Tempeh Chips are handcrafted in small batches usRizzuto says bringing the brands to ing the finest certified non-GMO Canada was a “labour of love” that fermented soybeans. The thin and included getting the proper labelcrispy chips are high in protein, halal, ling and certifications. “The brands gluten-free and low-carb. The lineup were already sold in Indonesia, but includes six varieties: Original, Barbethey needed a lot of fine-tuning to cue, Sweet Chili, Black Pepper, Black get them export-ready,” he says. Truffle, and Sour Cream & Onion. Elementary Produce also has ongoing support from the Indonesian Trade MomChipz offers a range of prodPromotion Centre in Vancouver. ucts made with just two ingredients – a fruit or vegetable (sourced diThe first shipment arrived in Canrectly from Indonesian farms) and ada in January and the products coconut oil. MomChipz contain no are rolling out at grocery chains added sugar, preservatives, or artisuch as Longo’s, as well as Toronto-
area independents like Cousin’s Market, Lady York Foods, Harvest Wagon, and Fiesta Farms. Rizzuto is confident the new products will hit the spot with Canadians, as the appetite for healthy snacking and unique options continues to rise. “Woh Tempeh Chips are completely different from anything in the market right now,” he says. MomChipz, meanwhile, will appeal to moms and families seeking healthy snacks – at home and on the go. “We want MomChipz and Woh to be seen as family-friendly brands that support healthy lifestyles,” says Rizzuto. “Not only that, but the manufacturers donate two cents from every product sold to children’s charities.”
To learn more, visit elementaryproduce.com and Instagram @elementaryproduce
Fresh PRODUCE TECH
THE FUTURE OF VERTICAL FARMS As global hype wanes and struggles come to light, what’s the outlook for Canada’s vertical farm sector?
SHUTTERSTOCK/ THE LEN
By Rebecca Harris They were hailed as the next big thing in food: indoor vertical farms growing year-round crops using significantly less water, land and energy than farms in the great outdoors. Not only was this hightech solution more sustainable, vertical farms would also help feed the planet. Loads of hype and billions in venture capital investment later, the lights went out at many vertical farms. Among those that ran into trouble were: Infarm, a Berlin-based startup that declared bankruptcy in major European markets in 2023; New Jersey’s AeroFarms, which declared bankruptcy last
TRENDS || TECH || MERCHANDISING || PRODUCTS
summer and emerged with a rebuilding plan; and Kentucky’s AppHarvest, which also joined the bankruptcy list in 2023. “I look at it similar to the way the internet bubble was, or even the cannabis [sector]. Everybody thought they could come into the field and make money on it, and some of them were able to raise crazy amounts of money,” says Mark Lefsrud, an associate professor in bioresource engineering at McGill University. “I will not say they had a good business plan.” Part of the challenge is vertical farming is a capital-intensive business, and many companies squandered large sums of money and invested in the wrong places, says Barry Murchie, CEO and president of GoodLeaf Farms, a Guelph, Ont.-based vertical farm operation that produces a range of baby greens and microgreens. “Many of them describe themselves as tech companies and they’re comfortable with burn rates that are associated with tech companies—and this is food,” he says. “You have to be very disciplined in your use of capital, you have to be focused on where you spend your money, and you have to make sure you’re building the right foundation.” Those companies, he adds, “are the ones that are going to be left standing as this consolidation and culling plays out.” For companies such as GoodLeaf, there remains an opportunity for vertical farms in Canada. Most of the country’s leafy greens are imported from the southwest United States, which is experiencing a decades-long drought. Compounding the water issues are ongoing supply chain challenges, truck-driver shortages and extreme weather events, which all point to the need for a domestic alternative. “[It’s important for] GoodLeaf and the country to build an ecosystem that brings food sovereignty and bends the supply curve from Southern California and Arizona back in the direction of domestically sourced product,” says Murchie. “It’s not a nice-to-have, it’s a need-to-have.” To meet growing demand, GoodLeaf recently expanded with two new facilities in Calgary and Montreal, at around 100,000-sq.-ft apiece. “We’ve taken our
time, we’ve sort of gone slow to allow us to go fast, and we’re now at a place of bringing our product to the rest of Canada,” he says. Bahram Rashti is CEO and co-founder of B.C.’s UP Vertical Farms, which grows and sells a full line of leafy greens, mixed salads and baby greens. He says unlike vertical farms that raised funds and tried to figure out how to make it work along the way, his company did it the other way around. “We designed and built our first [facility], bootstrapped it, and then showed the world that this is not just an idea … We figured it out and now we’re scaling,” says Rashti. UP’s products are now sold in Costco stores across British Columbia, and the company is looking into exporting to the United States. While vertically farmed produce is known to have a higher price tag, Rashti notes that field prices from the United States are now surpassing the alternative. “That is going to encourage more and more buyers and increase sales because all the other value propositions are already there: consistent, year-round supply of fresh, pesticide-free produce that has a longer shelf life when grown locally,” he says. The future of vertical farms may even expand beyond leafy greens and other vegetables. “Salad greens have a role in our grocery economy—no doubt,” says Mike Dixon, retired professor and director of the Controlled Environment Systems Research Facility at the University of Guelph. “But we’re not going to feed the world with lettuce. So, we need to expand the scope of commodities that come out of controlled environments.” McGill’s Lefsrud is optimistic about vertical farming in Canada. “I think it’s going to continue to grow … Kind of like the way the microbrewery market has taken over all these small towns, I’m expecting that most vertical farm systems will have their own little niche,” he says. “And the great part is you’re technically not competing with conventional agriculture—at least not Canadian conventional agriculture—because they can’t grow for 10 months of the year.” CG
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By being mindful of evolving consumer behaviours, grocers can win the most important meal of the day By Chris Powell
Though consumer attitudes towards breakfast have shifted over the years, it’s still widely accepted as the most important meal of the day. The Hartman Group’s most recent Eating Occasion Compass study found that breakfast remains one of the big three dining occasions. It was consumed a total of 49.9 billion times in the United States in 2022, trailing only lunch (52.1 billion) and dinner (63.3 billion). (In addition to the three main meals, the report divides eating occasions into eight dayparts including early morning snack, mid-morning snack, afternoon snack, after dinner snack and late night-meal snack.) And more than any other meal occasion, breakfast is stubbornly not tied to factors such as togetherness and socializing, with research showing nearly half of respondents (49%) ate breakfast alone. Breakfast has become more of a “functional” eating occasion, particularly for younger consumers, explains The Hartman Group’s senior vice-president Shelley Balanko. “It is often consumed alone, and what is eaten tends to be habitual or routine categories such as eggs, coffee and other common breakfast items,” she says. “Breakfast is often hurried, so quick preparation items are important.” As an eating occasion, it’s not surprising that breakfast is largely favoured by boomers, for whom the notion of “three square meals a day” was something of a
February 2024 || CANADIAN GROCER 51
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Aisles mantra during the establishment of their eating habits. In general, says Balanko, breakfast has been in decline as our food culture becomes more snack oriented. That’s further supported by Ipsos research, which found that 23% of people skipped breakfast last year, with head of syndicated solutions Asad Amin saying its significance “is on the decline.” The idea of an at-home breakfast is being impacted by the return to work, though, he says, coffee remains a “steadfast anchor” in home consumption habits. The pandemic did temporarily upend category norms, with cereal suddenly growing in popularity after being flat to declining (a phenomenon Mintel’s associate director, food and drink Joel Gregoire calls a “phantom bump”). But, with Mintel research finding that 52% of respondents are back at the office and 25% are working in a hybrid environment—some of the “norms” that defined the category pre-pandemic, such as a renewed emphasis on ease and convenience, are returning. That’s supported by The Hartman Group’s Eating Occasion Compass that
found an overwhelming 79% of respondents said when it comes to breakfast, their focus is on getting enough to eat and drink as quickly as possible. But breakfast is also a category that doesn’t invite much experimentation. According to Mintel, 73% of Canadians say they eat the same thing for breakfast most days, compared to 47% who say they eat the same thing for lunch. One thing’s for sure, consumers don’t want a fuss when it comes to the morning meal. In Mintel’s research, respondents said their No. 1 priority when it comes to breakfast is products that are easy to prepare (60%), ranking ahead of other attributes such as nutritious and quick to prepare (both 53%). Innovation around convenience within in the category tends to focus on portability, but Gregoire says a recent frozen hash brown product from McCain that requires no flipping to cook evenly, is a perfect example of customer-centric evolution. When customers wake up in the morning, they’re unlikey to be in an adventurous mood when it comes to their food, says Gregoire. “Speed, ease and nutrition
are important. If you’re going to innovate, health and convenience matters, but are you going to want to throw a lot of new flavours at people? Probably not,” he says. “If you were to innovate for any food category with different flavours or formats, breakfast is the toughest because of the inherent ties to routine.” The tendency, though, is towards “tweaks” rather than wholesale changes to how people approach breakfast. Nearly half (46%) of people surveyed by Mintel said rather than eat one big breakfast, they eat smaller items throughout the day. That number rose to 57% among 18to 34-year-olds, and to 56% among those who work from home. And the increased—and long overdue—attention being paid to food waste is also bringing about subtle product innovations. “Packaging and food waste are the environmental issues that most concern Canadians when buying food and drink in stores,” says Mintel research.
FOR MORE ON WHAT THE EXPERTS HAVE TO SAY ON BREAKFAST TRENDS INCLUDING TECH AND INNOVATION, VISIT CANADIANGROCER.COM
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Fantastic Fibre Canadians can now enjoy the benefits of both fibre and Activia probiotic* yogurt with the Activia Source of Fibre range, available in plain and vanilla flavour. With 2g of fibre per 115g serving, Activia Source of Fibre provides 7% of the recommended daily value. Consumers can enjoy the delicious vanilla flavour and treat themselves right with the plain version that is free of any added sugar or gelatin. *With more than 109 CFU Bifidobacterium lactis per serving, a probiotic that contributes to healthy gut flora
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SWEET ON SPREADS
From elevated breakfast staples to gourmet delights and global-inspired fare, innovation is helping grow the food spreads category
GETTY IMAGES/MAGONE
By Chris Powell ONCE DEFINED BY basic offerings and specific occasions, the spreads category is being transformed as consumers seek better-for-you and on-the-go snacking options, as well as global flavours and products capable of elevating the everyday. According to Fortune Business Insights, the global spreads category, which was worth US$85 billion in 2021, is expected to grow by 5.4% a year through 2029, eventually reaching US$132.2 billion. Flavour-driven, nutritious, and healthy dips and spreads have become “majorly popular,” the report says. Those findings are echoed by research firm Mintel in its U.S. Dips and Savoury Spreads Market Report 2023, which attributes the category’s growth to its “accessibility and ability to boost at-home eating occasions.” While people are still using dips and spreads for their primary purpose, Mintel’s research found consumers are increasingly seeking them out for their versatility “and ability to add to different occasions and meals.” Susan Niczowski, president and founder of Toronto-area company Summer Fresh Salads, says innovation is important to the category’s growth. “Consumers are demanding bigger, bolder flavours that excite the senses, and [are] turning to spices and ingredients” to achieve their flavour goals, she says. And while consumers remain fond of “tried-and-true” products, they’re also increasingly “very adventurous,” says Niczowski. That means a willingness to
try “fun” flavours such as Summer Fresh’s Dill Pickle Hummus and the recently launched Dessert Hummus in Chocolate Brownie and Key Lime varieties. “Consumers gravitate to brands they trust when it comes to innovation, and consumer segments like millennials and gen Zs are always hunting for the next big food item,” she says. Jo-Ann McArthur, co-founder and president of Toronto’s Nourish Food Marketing, says several key factors are leading to innovation in the category. Most notably, the hybrid work environment is contributing to more at-home snacking occasions, and people looking for different eating experiences because they’re dining out less at restaurants. Spreads are also being used with fruits and vegetables rather than just their traditional application on crackers and bread. And, she adds, sweet and nutbased spreads are increasingly being consumed outside of their traditional breakfast and sandwich occasions. Spreads also offer increasingly adventurous consumers an “easy, relatively inexpensive way to try a new flavour,” says McArthur. She cites the growing popularity of the Tunisian chili paste harissa as one such example. Producers are getting innovative with traditional ingredients, too. Saskatoon-based company One Meal a Day, for instance, has introduced lentil spreads made exclusively for Co-op Food Stores: Co-op Gold Pure Lentil Butter, and Co-op
Gold Pure Chocolate Lentil Spread. Co-op bills the new offerings not just as options for those with nut allergies, but also suitable for people seeking “unique flavours,” while boasting an enticing combination of high-protein and low fat. Even kid-friendly spreads such as peanut butter are catering more to an adult audience. Montreal-based Manba, for example, specializes in Haitian peanut butter that is spiced with Scotch bonnet peppers. It is sold in Classic, Spicy, Extra Spicy, Crunchy and Creamy varieties. Heather Fadali, vice-president of product management and innovation at Loblaw, points to No Name Dark Roast Peanut Butter as an indication of the grocer’s ongoing effort to provide an “elevated” spread option for adults. The spreads category, she says, is being reshaped by a combination of global flavours and trending items on restaurant menus. “Different spreads like tahini, peanut butter and jams continue to be popular, with new varieties constantly arriving on shelves,” she says. One of the key factors contributing to the growing popularity of spreads is they are suitable for a variety of eating occasions, says Fadali. “The versatility is one of the reasons they are so popular with our customers,” she says. The shift towards more plant-based and health-conscious diets is also showing up in the spreads category, says Tatiana Bossy, co-founder and president of Quebec-based company Le Grand, which counts vegan cheese spreads, butters and pestos among its products. “Where we’re going to see innovation is in the better-for-you space,” says Bossy. “People want to elevate the quality of the food they’re eating and not drown themselves in unhealthy choices.” Bossy says as consumers turn to a more vegetarian diet, either because of the rising cost of proteins or because of health considerations, they’re looking to spreads to add a little pizzazz to veggies. While savoury spreads are popular, grocers are also seeing heightened demand for high-quality sweet spreads. Loblaw featured its PC Dulce De Leche spread in the most recent edition of its PC Insiders Report, with Fadali noting it can be served either as a topping or as an accompaniment to its PC Frozen Puff Pastry. Fadali also points to Loblaw’s PC Black Label British Columbia Raspberry Fruit Spread—a personal favourite, she notes—as another example of the grocer’s elevated offerings.
February 2024 || CANADIAN GROCER 57
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1 SHOW YOUR CARDS
Seventy-seven per cent of unplanned greeting card purchases occur when shoppers see these items on display, according to Carlton Cards’ research. This makes the merchandising of greeting cards in high-traffic areas critical. Lisa Hutcheson, managing partner at J.C. Williams Group, recommends greeting cards be sold alongside flowers, gift packaging and gift cards. “This enhances the overall shopping experience, increasing the likelihood that customers will opt for traditional cards rather than digital alternatives.” And once established with regular shoppers, Hutcheson says “this approach can also function as a loss leader, like the way lotteries attract foot traffic.” Having expanded to five locations in the Greater Toronto Area, Summerhill Market has ensured every store includes space for greeting cards. “Stores where we’ve had them the longest perform best because customers know they can come to us for quality seasonal cards,” says Summerhill Market co-owner Brad McMullen.
Greeting cards
Four things to know By Chris Daniels
3 HARD COPY Given the “decline in standalone greeting card stores,” Hutcheson of J.C. Williams Group says grocery retailers can benefit, even in the digital era, from consumers who “still place sentimental value on physical greeting cards.” This is reflected in Grand View Research showing the global greeting cards market—which is dominated by North America—is growing. Valuing the market at US$19.2 billion in 2022, it predicts a CAGR of 0.9% from 2023 to 2030. Customers of all ages are fuelling the staying power of paper. A 2023 poll from Shutterfly, a California-based digital photo printing service, found two in three Americans prefer to receive physical cards as opposed to digital ones–including millennials (62%) and gen Zs (59%). And according to a 2022 shopper study in Canada by Carlton Cards, 75% of women and 65% of men are greeting card consumers.
4 TRENDSPOTTING
2 OCCASION CHANGES Greeting cards fall into two categories: seasonal and occasion-based. At Carlton Cards, seasonal cards comprise 30% of its annual sales, led by Christmas, Valentine’s Day and Mother’s Day. When it comes to occasions, “birthday is by far the No. 1 selling greeting card,” says the company’s general manager Paul Werynski. There are also emerging occasions. “Younger consumers prefer to celebrate in their own way; for example, hosting gender reveal parties versus traditional baby showers,” explains Werynski. In response, Carlton Cards has created “more versatile and inclusive” options for celebrating baby. (Think more genderneutral colours and designs without the term “baby shower.”)
Greeting card manufacturers are going beyond evergreen images of adorable puppies or birthday cake. “Capitalizing on pop culture trends like pickleball, fungi, llamas or capybaras, our cards are ever-changing,” notes Carlton’s Werynski. “Gift packaging is co-ordinated with these trendy cards to give the consumer perfect presentation for their gift.” Meanwhile, Paper E. Clips, a wholesale distributor of greeting cards that counts Summerhill, Stong’s Market and independent Foodland locations among its clients, offers birthday cards with cover illustrations of pop star Taylor Swift, Barbie and Ken, and Ted Lasso character Roy Kent. As far as formats go, pop-up cards are popular. Paper E. Clips offers the brand Up With Paper, while Carlton Cards has the Magic Moments line and licencing deals with Star Wars, Marvel, Disney and more. “We continue to add new occasions, formats and even special licenses to our Magic Moments portfolio due to the popularity,” says Werynski. February 2024 || CANADIAN GROCER 59
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3 AMY’S KITCHEN FAMILY SIZE ENTREES Amy’s Kitchen has launched family-sized versions of its signature frozen vegetarian dishes—Broccoli & Cheddar Bake, Cheese Enchilada and Vegetable Lasagna. Made with organic and non-GMO ingredients and high in protein, these meals range in size from 765 grams to 920 grams and can be heated in the oven or in the microwave. 4 TETLEY LIVE HAPPY, LIVE BALANCED TEAS Tetley Canada has added two flavours to its caffeine-free line of herbal Live Teas. Live Happy combines the sweetness of mango and tangy passion fruit flavours with lion’s mane, while Live Balanced blends dandelion with roasted chicory root and carob for what the company describes as a nutty, coffee-like flavour. 5 DEL MONTE’S FRUIT CHUNKS IN FRUIT PURÉE SNACKS Crafted at Del Monte’s partner fruit co-operative in Northern Greece, the company’s new fruit chunks in fruit purée snacks are high in vitamin C and low in calories. Available in two flavours—peaches and pears—and sold in packs of four, these fruit snacks are naturally sweetened with grape juice, free from artificial colours and are shelf stable. CG
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February 2024 || CANADIAN GROCER 61
Express Lane
RESTORING RETAIL
Why the physical shopping experience still matters By Kristin Laird
to animate its culture and, ultimately, to animate its value to the consumer. What’s the difference between shopping at Loblaws versus Metro? Am I feeling a difference in brand values? Is there a difference to the architecture of the experience? These are lost opportunities for these stores to use their locations as the most powerful form of media they have.
You’ve been quoted as saying, “the store is media and media is the store.” Could you explain what you mean by that?
Amazon ran an unprofitable business for about two decades to build the intelligence, the technology, the infrastructure, the logistics supremacy it has today. They’re at the point now, if you order something at 9 p.m. on Wednesday you can have it Thursday morning. How can grocers compete with that? I suspect most cannot. The better alternative is to capture a different aspect of the consumer’s loyalty and capture it more deeply. And what I’m always amazed at, is the lack of customer experience in most grocery stores. Essentially, we’ve “retail-ized” a warehouse. We’re not offering any sense of community. We’re not offering any level of entertainment. We’re not offering any level of expertise in the store. If you want to know how to make beef bourguignon, good luck. You’re better sitting at home watching videos than going to your local grocery store. So, there’s opportunity if grocers are willing to break the paradigm and ask, could a grocery store be a place where people go for fun?
If we go back 30 years, brands would buy media and they would use that media to drive consumers to their store. Today, every form of media consumers have contact with—our smart TV, our smartphones, social networks, videos—is “the store.” Not only can I buy without going to a physical store, but I can also buy more intelligently. I can watch videos; I can read reviews. I’m getting more information [online] than I am standing at a shelf with 14 kinds of hot sauce without any information apart from what’s on the label. So, I would argue that media has become the store. The evidence of that is when the average consumer needs anything, they’re not defaulting to the local store. They’re going online and, increasingly, they’re going to Amazon. Then, the question is, what is the point of a physical store? The store is an opportunity for the brand to animate its values, 62 CANADIAN GROCER || February 2024
Amazon has set the expectation that consumers can buy anything, anywhere, any time and at a reasonable price. Can grocers meet those expectations?
What in-store technology would help from a customer service perspective? Going back 20 years, I was showing audiences early experiments in AI by companies like Microsoft that were building bots that could work conversationally with consumers. So, shoppers could ask for cooking advice. I expect to see more deployments on store floors that will allow consumers to interact with AI in a conversational way. What we must get beyond, I guess, is the social discomfort of doing that. Having a conversation with a machine in a crowded environment may feel strange, but that’s the next frontier of customer experience—delivering in-the-moment knowledge to consumers.
Selfridges’ founder Harry Selfridge said, “Excite the mind and the hand will reach for the pocket.” How could this play out in grocery retail? The question retailers should ask is, how can we get the customer who comes in quick to grab something for dinner to walk out with 30% more? And that is a product of creating excitement, enticement, theatre in the store. Even simple little things like tastings; let people taste something they haven’t tasted before. That is woefully lacking in the grocery industry. Watching a quick seminar on how to cook something, or quick meal ideas, again, a lost opportunity to build that sense of affiliation. CG
FOR MORE Q&A WITH DOUG STEPHENS VISIT CANADIANGROCER.COM
RETAIL PROPHET
IN A WORLD where almost anything is available with the click of a button, grocers can offer what many digital players can’t: a unique and exciting in-store experience. We recently spoke with Doug Stephens, a retail industry futurist and founder and president of Retail Prophet, a Toronto-based retail consultancy, about the impacts of digital on the grocery industry and how grocers can leverage technology to enhance the in-store experience. This interview has been edited for length and clarity.
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