Issue link: https://digital.copcomm.com/i/646914
march 2016 / the tasting panel / 101 By considering the customer's buying journey and the kinds of questions he or she might ask—Do I want white or red? What am I having for dinner tonight? What is my budget?—Kroger tapped into the customer psyche to determine how best to sort and merchandise wine. "We keep a constant eye on what our customers are telling us they want to see and purchase—from price points to varietals—in order to maximize the efficiency of our shelf space and, in turn, best serve our wine consumers," McHendry com- ments. "This also allows us to intelligently right–size our wine sections based on ever-changing buying habits and to provide our customers with the best possible shopping experience." McHendry predicts big changes for the future of consumer wine-buying, and, with his "insider knowledge," we are apt to believe him. "There is no doubt that we will see continued growth in sparkling, rosé and Pinot Grigio— not to mention white wines in general as they become a year-round choice versus a seasonal one, as in the past," he says. "However, I have to say that my trend to watch over the next several years will be the growth of imported wines, from all regions. Wine consum- ers are becoming more educated every day and with an abundance of high-quality imported wines at great price points readily available, it will be interesting to watch how differently wine consumers interact and engage with imported wines over the next several years as imports become a larger part of the wine shoppers' basket." Adding a Personal Touch Mergers have been a key component of Kroger's growth, including a $13 billion deal with Fred Meyer Inc. in 1999; a merger with Harris Teeter, comprised of more than 200 stores, in 2014; and a merger with one of the largest e-commerce companies in the nutrition and healthy living space, Vitacost.com, later that same year. How does an organization that has grown so large bring personalization and individual attention to the consumer experience? "We have found great success with the synergies that come from a unified plan, from both an execution and a marketing standpoint in our stores," McHendry explains. As the retailer's customer base has grown increasingly diverse—ethni- cally, in terms of household mix, shopping behaviors and purchasing patterns—its variety of store formats has also allowed it to meet the needs of this base. McHendry elaborates: "We are here to serve our customers and are passionately committed to understanding what they are telling us both through direct feedback and our internal data sources. In turn, we utilize that knowledge to constantly challenge ourselves to keep the customer satisfied. This strategy, called our Customer 1st Strategy, has been and always will be the foundation on which we will build our success." McHendry continues the legacy established by the original Barney Kroger, who became the first grocer to bake bread in-house, in an effort to reduce the cost for customers and provide more quality control. Similarly, Kroger united the butcher shop, bakery and grocery under one roof, the first retailer to do so—all in an effort to best service customers. The amount—and life savings— founder Barney Kroger invested to open a grocery store in downtown Cincinnati in 1883 Number of stores to date, 130 years later, across 35 states The year Kroger tested an electronic scanner, making them the first grocery retailer in the nation to do so. Continuing to build on that digital innovation and convenience, the store has reduced customers' wait time to check out from four minutes to less than 30 seconds. Annual sales across all Kroger concepts The percentage of private-label items produced at one of Kroger's manufac- turing plants, a figure that allows the business to keep costs competitive Square footage of Kroger's combina- tion stores, a response to customers' desires to experience the convenience of one-stop shopping—from groceries to gas, from pharmacies to floral Year that Kroger's private label natural and organics brand Simple Truth reached $1.2 billion in annual sales (within two years of its launch) KROGER by the Numbers Ryan McHendry (center), Coordinator of Category Management for the Wine Team at The Kroger Co., with his team of Category Managers (left to right): Brian Leuzinger, Diane Farfsing, Dave Morehead, Pat Byrne, Lisa Beth Miller and Jared Pachta.