PG Retailer of the Year: ‘Centerpieces of the Community’
PG's 2014 Retailer of the Year coverage continues with Ahold USA's COO James McCann and Tracy Pawelski, VP, external communications, who discuss the rapid changes unfolding in the grocery industry, including its online retail Peapod subsidiary and pilot plans for a smaller store concept.
Discussing the extraordinary support that Ahold USA’s retail divisions and Peapod provide for the communities in which they operate, Tracy Pawelski, VP, external communications, describes the stores’ central role as that of “centerpieces of the community. The relationships we have with our customers and the communities as a grocery store is very different than other retail establishments, which don’t see customers as frequently. Our story is built on the legacy of our brands, and part of being a better neighbor means being there for our customers, associates and communities.”
And though many may not realize the full scope of Ahold USA’s divisional philanthropic efforts, Pawelski believes, “Customers today want to know that they’re doing business with a good corporate citizen.” While shoppers in its marketing territories readily associate the company’s retail banners’ messaging of “great prices, great places to work, and great places to help shoppers find affordable, healthy choices for their wellness goals,” Pawelski affirms the company’s commitment to building close community connections — be it at the grass-roots, local level with cake donations, or by undertaking massive relief efforts to help rebuild communities after catastrophic events — is enduring.
And so it goes with the rapid changes within the industry, which McCann describes as ubiquitous and intense. “It’s no secret than the industry is changing more quickly now than it has in earlier years,” he notes, an evolution compounded by the onslaught of formats now selling groceries. “Our plan is to become a great retailer in other formats as well,” including digitally, with the Skokie, Ill.-based Peapod division, as well as with smaller-format stores, plans for which McCann and company are studying “closely, to explore and test what might work well for us.”
While McCann says that “no concrete plans at present” have been mapped out for an Ahold USA-brand small-store concept, he confirms: “We’ve got a very good R&D team behind it, gearing up for tests and trials to see if there’s something out there that we want to develop and deploy. We believe that we have the people, the brands, the store locations, the infrastructure and the financial resources to be able to do it, which is truly a part of what our good-to-great journey is all about.”
Becoming Famous
In his ceaseless quest for innovation, McCann is pumped about the possibilities of the Peapod online retail division, which reached a number of key milestones by the end of 2013. After opening 200 pickup points and a digital innovation hub in Chicago, Ahold USA continues to accelerate its online growth.
While Ahold USA is decidedly further along with its e-grocery platform than many, McCann says that continued “speed and development is necessary in order to stay ahead.” Online retailing is one of the three areas “we want to become famous for. We truly want to become better than everyone else in the markets where we compete.”
In addition to digital retailing, McCann has related aspirations to make the company “famous” across a broader spectrum with upgraded products, paramount to which is produce, “which welcomes customers into stores at the entrance and which is often the primary reason people come shop. It’s also because it’s a product category that people really interact with and have strong feelings about.”
The third leg of Ahold USA’s “famous” aspirational stool rests on private label, not only as it pertains to the obvious better-margins component, but also because of its greater affordability for customers and its expediency as an ideal learning platform. However, according to McCann, the biggest single advantage with private label “is that it’s exclusively available in the stores. We want customers to enjoy our brands, stores, people and products so much that they do all of their shopping with us and recommend us to others.” In turn, he adds, “We must continue to strive to develop an even better, more relevant assortment to meet customers’ daily needs, with a broader range of products and services, including new and innovative own-brands products.”
More of PG's exclusive interview with Ahold USA's COO James McCann can be found in related stories, including "PG Retailer of the Year: Health on an Accessible Shelf."