Much has been written about the sales decline of many of the critical center store categories in traditional supermarkets, as they lose customers to clubs, mass merchants, dollar stores and on-line alternatives. Conversely, there has been much less evidence that supermarkets have successfully responded to this competitive threat. 

One such exception is what I am seeing in Kroger stores and specifically in the frequently purchased, non-perishable categories of paper, detergent, and household cleaners. 

My guess is that Kroger is leveraging business intelligence from their industry-leading data analytic resources tells them that shoppers tend to buy certain items from a variety of categories in clusters. These compatible categories are simply defined as those that tend to fall into the same baskets often on the same trip. Those categories that represent significant basket penetration are important to identify for a variety of reasons, but first and foremost, understanding that losing a shopper’s patronage in one of these categories likely will lead to losing in the others. 

While some retailers have attempted new fixtures, lower pricing and more frequent promotions, the more visceral approach I see at Kroger should be noted.  They have taken the next step by giving their Paper Products category the elements of departmental status in its presentation. By widening the aisle and improving access to the category there is now room to place palletized deal product in the additional space, coupled.  Further, messaging in the newly formatted category makes a strong statement that there is no need to shop another channel or store for these items.

Paper Products have been a particularly vulnerable category for traditional supermarkets to defend.  Clubs, mass merchants, dollar stores, and now online-scheduled-use agents have stripped away these sales due to a combination of price and convenience factors. However, numerous studies tell us that time-conscious shoppers, given the choice of shopping more outlets or channels would prefer to consolidate as much of their grocery shopping at one retailer as possible. The effort I see at Kroger has the both the elements of price and convenience that better compete for those shoppers.

Regaining lost shoppers in frequently purchased category like Paper Products also positions traditional supermarkets to also recover sales in compatible categories that tend to fall in the same baskets during the same trips as paper. Basket analysis will reveal the identity of those categories. 

Kroger’s efforts also reflect many of the tenets of shopping behavior that are necessary to make the category more convenient to access, navigate and make purchases decisions once in the category.  Empirical research on these topics can be found in books from Dr. Neale Martin, “Habit, the 95% of Shopping Behavior Marketers Ignore” and Dr. Herb Sorensen, “Inside the Mind of the Shopper”. Both are good reads for retail space planners and merchandisers who are looking to revive business in the supermarket center store.