What does the center store of the future look like?

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What does the center store of the future look like?

By David Salazar - 06/23/2017

COLORADO SPRINGS, Colo. — Global Marketing Development Center’s latest report on next practices is urging retailers to rething their in-store and online strategies to adapt to how consumers are shopping in order to stay competitive.

GMDC’s Center Store: Essential for Total Store Growth report highlights the fact that such elements as nonfoods, grocerants and in-store health clinic can play a big role in improving customer experience and combating food price deflation, loss to online sales in impulse categories and changing shopper interests. Among the key players in stores that are aligning with consumers desires, the report said, is a focus on wellness.

“The best stores run wellness sections that parallel today’s healthful lifestyle and self-care trends,” GMDC president and CEO Patrick Spear said. “Their inline areas for housewares, home, baby, home office, pet and more, infuse the latest technologies and design. And they collaborate with brands that know end-users well, while innovating to connect emotionally. It’s these type of strategies that upgrade store image and performance, and win the hearts and minds of today’s consumer.”

For the report, GMDC worked with Nielsen, Kantar Retail, Acosta, Profitero, Jacent Merchandising, GlobalData, BHDP and RNG to bring actionable insights about what food and nonfood items can be paired to bring in as much as 400% more sales. The report conceptualizes the “center store of the future,” reflecting how consumer attitudes are projected to change in the coming years — including store-in-store concepts, new meix strategies, health and occasion groupings and potential aisle layouts.

Steps that retailers can take to make the center store exciting include creating a manager position over cross-merchandising, allowing them the leeway to decide what the optimal product pairings and places for cross-displays are. Additionally, it the report recommends a commitment to metrics detailing cross-merchandising successes to make them repeatable. And when it comes to health and wellness, the report notes that retailers can shine in brick-and-mortar where their digital competitiors can’t — namely by offering health consultations and dietitian services in-store to further engage customers.

The report also notes that if food retailers got shoppers to purchases one more general merchandise item annually — four instead of three — they would bring in $500 million in additional revenue. The center store  — as well as the front and perimeter — is the biggest nonfood destination in the store based on consumer interests, the report said, noting that such categories as personal care, pharmacy and health, beauty and wellness can play a big role in retaining shoppers.

“It’s irrefutable that shoppers — led by millennials — want nonfoods to be as convenient as possible to ease their tasks, and they want it cool and edgy to match their adventurous nature,” GMDC director of research, industry insights and communications Mark Mechelse said. “Nonfood items today are a ‘badge of honor’ for consumers. It’s truly the way these categories will differentiate themselves in the new world of shopping.”

GMDC said that Hallmark, American Greetings, BIC, Navajo Incorporated, Energizer and True Brands helped make the report possible. The full report can be accessed here