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Publix Super Markets, Inc.
Spend any appreciable amount of time in Florida and, chances are, you will find yourself stepping inside a Publix supermarket. Over 750 stores cover the Sunshine State alone, with another 300-plus across Georgia, Alabama, South Carolina and Tennessee.
Publix Super Markets, Inc. got its start when George W. Jenkins opened a store in 1930, in Winter Haven, Fla.—a bold business move at a time when the country was mired in the midst of the Great Depression. But his gamble paid off, and by 1934 his market was garnering over $100,000 in sales, prompting him to open a second concept—this time with a focus on economy—in 1935. The business was—and still is—privately held and associate-owned.
Jenkins (or “Mr. George,” as he was affectionately known) revealed the future path for Publix in 1940 when he mortgaged an orange grove to bring his vision of a modern supermarket to life. He called the store—largely hailed as the first truly modern supermarket in the state of Florida—a “food palace,” designing it with stucco, marble and glass, complete with piped-in music, air conditioning, fluorescent lighting, automatic “seeing-eye” doors, frozen-food and dairy cases, and in-store doughnut and floral sections. After the war ended, he bought 19 All American grocery stores, catalyzing expansion—and sales. By 1951, the chain had grown to 24 units and gross sales surpassed $18 million. Four short years later, that number had grown to $49 million. Regional distribution centers were added, and an empire was taking shape.
Today, the chain, with headquarters in Lakeland, Fla., boasts over 1,000 units, employs over 157,000 individuals and is the largest employee-owned supermarket chain in the country. Publix grew beyond Florida in the early 1990s with its first store in Georgia; units in South Carolina and Alabama soon followed. Expansion continues, and Publix has noted that it will open its first store in North Carolina—in the greater Charlotte area—in early 2014. It will also open a division headquarters in Charlotte, only the second division office outside of Florida (the other is in Atlanta), clearly pointing to its strong commitment to the North Carolina market. Total sales across the chain in 2011 totaled $27 billion.
Publix maintains distribution centers scattered throughout Florida, in Boynton Beach, Miami, Deerfield Beach, Orlando, Jacksonville, Sarasota and Lakeland, along with one in Lawrenceville, Ga. Deerfield Beach, Jacksonville and Lakeland, Fla. are also home to manufacturing facilities for store-brand dairy, deli, bakery and other perishables; Atlanta and Lawrenceville, Ga. locations also manufacture dairy and bakery products.
Although Publix has honed its focus on the American Southeast, demographics vary considerably across its territory. “Each of our stores has the ability to order the majority of the products we have SKUs for,” says Maria Brous, director of media & community relations, Publix. “However, depending on the store location, we do offer a different product mix in order to achieve local customization. If a customer is looking for a product that we do not typically stock, the manager is able to place a special order for the product, if available in our market area.”
Una Tienda con Sabor
One demographic particularly vital to retail grocery success is the U.S. Hispanic population. As of 2011, Hispanics comprised 16.7% of the U.S. population, hitting an estimated 52 million people according to the U.S. Census Bureau, Washington, D.C. By 2050, the Census Bureau estimates that number will have reached 132.8 million—comprising 30% of the U.S. population.
Publix understands the importance of this demographic and has created Publix Sabor to offer it—and the greater U.S. population that’s increasingly interested in Hispanic-oriented foods—to meet its needs (sabor is the Spanish word for “flavor”). “Publix Sabor stores offer a larger selection of Hispanic and Caribbean items, as well as larger product sizes, in addition to the traditional product mix at Publix stores,” says Brous. “In addition, Publix Sabor locations have dual signage (English and Spanish), as well as a variety of fruits, roots and vegetables in an open-air feel. Some of the selections in the meat case also vary to reflect shopper preferences, such as tripe, pig’s feet, fish heads, oxtail, roast pork, etc.”
Brous explains that the attention Publix pays to demographic concerns doesn’t stop with the Hispanic market. “All customers are important to us at Publix,” she says. “And yes, regardless of the banner name, Publix, Publix GreenWise Market and/or Publix Sabor, we tailor the product selection to the customer demographics. In addition, we know that all customers enjoy the flavors of good food. The customer palate is not based on ethnicity, but rather on exploring foods that resonate with a memory, experience or evoke the senses. We bring these flavors to all our customers, and staff our stores with associates who are passionate about servicing our customers and food.”
Going GreenWise—and Beyond
Sales of natural and organic products continue to grow, and mainstream supermarkets have raced to offer their own store brands to meet the needs of this demographic. In Oct. 2011, Nutrition Business Journal noted that, in 2010, sales of natural and organic foods grew by 8% while the overall food-industry sales only inched forward by 1%. And most of these sales are coming from traditional retailers, not specialty natural-products stores. The Organic Trade Association, Brattleboro, Vt., reports that during 2009 54% of natural and organic product sales were made at conventional retailers, with specialty natural products stores only pulling in 40% of this market.
Publix jumped into this arena with its GreenWise lines of all-natural, minimally processed, non-GMO and/or organic products. A selection of GreenWise products in perishable sections includes:
- Several types of salad mixes and greens
- USDA choice beef cuts “raised humanely” and without antibiotics or hormones
- Ground round or chuck
- Several types of chicken, including skinless breast fillets “raised with care in clean flock houses with plenty of fresh air, space and light”
- Organic eggs offered in 100% recycled packaging
- Chocolate, vanilla and plain soymilk made from organic soybeans
- Organic whole, reduced-fat and fat-free milk
Although Publix carries its GreenWise products in all of its stores, it also has opened specialty GreenWise Market locations that highlight these selections, billed as a “one-stop shopping destination for anyone who appreciates organic, all-natural and earth-friendly products…” This selection includes “artisan cheeses, fine wines, handcrafted fresh breads and much more.” At GreenWise Market locations, perishables are highlighted, with meat, seafood, produce and dairy prominently featured. Publix began offering private-label specialty cheeses in 2010, notes Brous, and that the selection of options continues to grow. Current varieties include Danish blue, Brie, Camembert, Manchego, Parmigiano-Reggiano, Pecorino-Romano, Asiago, Hoop Cheddar, goat, fresh mozzarella, Parmesan and Swiss. In some Publix stores—particularly newer models—these private-label cheeses sit amidst nearly 200 other cheese options, whether domestic, imported and/or artisan. Locations with these extensive cheese displays often feature in-store cheese specialists to help customers make selections and provide educational pointers.
The prepared-foods section of GreenWise Market locations challenges shoppers to consider it an alternative to their favorite restaurant. Daily options include items from the Mediterranean Oven; Chef Selections; and the Grill, Carvery or Soup Station. Sandwiches and salads are likewise on the menu. Brous also notes that the majority of Publix locations also offer fresh sushi made on-site each day. (See “Reimagining the Deli” below for more on these concepts.)
But to date the reach of specialty the Publix GreenWise Market has been rather limited as a standalone concept, with only three locations. Greater potential is achieved via integration. The future of Publix is its “hybrid” concept—stores with a larger footprint (in the ballpark of 50,000 to 60,000 sq. ft., reportedly housing approximately 40,000 SKUs) that combine elements of traditional and GreenWise Publix stores, along with a greatly expanded deli and foodservice options. The first such unit opened in Naples, Fla. in 2010, and others have subsequently opened in Brookhaven, Ga., just outside of Atlanta, and elsewhere. This larger concept is generally considered the prototype for future development.
Consumers focused on natural and organic foods—which often command a premium over conventional alternatives—tend to value a more in-depth story behind their foods, tracing items from farm through processing and all the way to the store. To this end, Publix publishes details related to its GreenWise selections in its own magazine, FamilyStyle. It also hosts a “Natural Foods Glossary” on its website. Key consumer demographics, including those prone to selecting natural and organic foods, are also leaning toward eating more seasonally. To that end, Publix publishes an “At Season’s Peak” page on its website detailing when certain fruits and vegetables are at their peak throughout the year. It also offers At Season’s Peak email and text alerts so consumers can receive information on when seasonal produce will arrive in the store.
Freshly Baked Memories
In addition to the standard capabilities for customized desserts, Publix displays differentiating touches through its regular selection of desserts and other baked goods.
Unique dessert offerings include Sicilian cassata torte (a vanilla layer cake featuring hints of rum and cannoli cream), retro Russian-inspired (by way of France…) charlotte russe (vanilla cake surrounded by ladyfingers and topped with strawberries and vanilla cream), dulce de leche torte (Hispanic-inspired vanilla layer cake with caramel notes and toasted almonds) and a nostalgic favorite from the Northeast, brown derby cake (chocolate cake layers sandwiching strawberries, bananas and peaches topped with vanilla cream and dusted with chocolate cake crumbs).
Insightful demographic analysis can pay off. In this case, considering Florida’s strong percentage of residents who have migrated from other areas of the country (retirement) or elsewhere around the world (notably Florida’s thriving Hispanic population), offering selections that trigger childhood and otherwise nostalgic memories can spur sales.
Another take on this tactic also appears in the bakery. Beyond the obligatory baguettes, hamburger buns and other assorted breads and rolls, Publix offers “Chicago hard rolls” (that have “authentic Windy City flavor”).
Reimagining the Deli
Independent and chain supermarkets across the nation are in the process of transforming their deli departments into dynamic stopping points for specialty products, carry-out foods and ready meal solutions. Publix began its reimagining of the deli back in 2007 in conjunction with the opening of a new store in Lake Mary, Fla.—one that features a 4,500-sq.-ft. “culinary prepared foods experience with over 80 entrées to engage every palate and engage every sense.” Beyond what Publix traditionally featured in its deli, the new concept includes the following “stations”:
- Pacific Wok—wok-cooked Asian specialties (kung pao scallops, Mongolian beef, etc.)
- The Grill—entrées cooked to order, from curiyaki salmon (combining curry and teriyaki elements) to Latin-inspired churrasco steaks
- The Carvery—various center-of-the-plate items, including cedar plank salmon, hickory & molasses crusted tenderloin of beef, and slow-cooked pot roast
- Chef’s Selections—Publix uses this station to showcase the talent of its chefs (a notable staffing move in and of itself), featuring everything from comfort food to gourmet entrées
- Mediterranean Oven—Old World pizza and roasted entrées inspired by Italian, Greek and Spanish cuisines
- Handcrafted Sandwiches—“artisan” sandwiches made to order
- Custom Salads—made to order with fresh toppings that include steak, salmon, shrimp or chicken
- Soup Station—“freshly prepared, chef-inspired” soup creations
- Coffee Bar—freshly brewed Van Houtte coffees, hot chocolate and frozen fruit drinks
While Lake Mary was the pilot, select “stations” soon spread throughout the chain—and will prove core features of the new Publix “hybrid” markets, while working their way into existing stores when possible. “Lake Mary was one of our original Publix locations which offered different deli venue selections, such as the Pacific Wok, The Carvery, Chef’s Selections, etc.,” says Brous. “However, where practical, we have taken some of these venues and placed them in our mainstream deli departments to offer our customers a greater selection of meal solutions. Publix GreenWise Markets and larger-format stores offer many of these venues.”
Such options—whether consumed in Wi-Fi-equipped in-store cafés or taken to go—allow retailers a viable entry into competition with the restaurant industry. Even with the projected incremental economic improvement during 2013, recession-era habits have been lingering, and the competition between various restaurant categories (casual, family, QSR, etc.), and between restaurant and retail, continues to intensify, revealing key opportunities to capture consumer away-from-home food dollars.
Don Your Aprons
An educated consumer is a better consumer, and when retailers can play a part in improving customer dining experiences at home—and boosting their culinary chops in general—they grow progressively closer to their core customer base, further ingraining themselves into overall multi-tiered branding efforts.
At Publix, this educational approach falls under its Aprons initiatives, and encompasses both in-store and online programs—even dedicated cooking schools located at seven stores in Florida and one in Georgia. “Our customers always enjoy our Publix Aprons features, from our in-store demonstrations to Publix Aprons Cooking Schools, Publix Aprons Event Planning, Publix Aprons recipes and, most recently, Publix Aprons Catering,” says Brous. Aprons Cooking School classes range from demonstrations by celebrity and renowned chefs to pairing wine and beer with foods, teaching specific culinary techniques (knife skills, approaches to specific ethnic cuisines, etc.), and even classes geared toward young, budding culinarians, from ages 8 and up. Aprons Event Planning offers insight into pairing the right foods and buying the proper amounts for an event—all at no extra charge to the customer. Aprons Catering, a new initiative, is available through two locations in Florida.
Recipes are also a key piece in this puzzle—and one of the primary reasons consumers visit retailer websites. “Our in-house team of chefs and professionals do their due diligence to provide our customers, whether the beginner cook or experienced chef, with great-tasting, wholesome recipes to bring the family back to the dinner table in less time,” says Brous. “We want our customers to enjoy cooking and have a passion for food. We can accomplish this by respecting their time and giving them tried-and-true recipes that are easy to recreate at home, usually in 30 minutes or less.” Some recipes are billed as taking 15 minutes or less—and various selections include video demonstrations. Visitors to the Aprons recipe database have the option of adding specific necessary ingredients to a shopping list.
Competition has grown fierce in retail grocery over the last decade, with superstores, club stores, specialty grocers and others coming at traditional grocery stores and supermarkets from all directions. By offering a savvy mix of forward-trending and traditional options, Publix should be smartly poised to accept all challenges.