Progressive Grocer Interview with Jeff Smith, Revionics
Progressive Grocer’s Editor-in-Chief Jim Dudlicek interviews Jeff Smith, Revionics EVP Corporate Development and Strategy. Jeff delineates the difference between Dynamic Pricing and rampant price-matching and the disastrous race to the bottom. Now, with shoppers more in control than ever, Jeff describes how retailers can use targeted pricing at the pace appropriate to their business to survive and thrive.
JD: I’m Jim Dudlicek, editor of Progressive Grocer. We’re here at the FMI Mid-Winter Conference talking with Tim Lowe, president of Lowes Foods. Welcome Tim.
TL: Great, Jim. Glad to be here.
JD: Last March, Lowes announced very aggressive growth strategy based on shopper feedback that resulted in you opening some new stores, remodeled some, had some rebranding… Can you give us an update on how that’s going?
TL: Yes, Jim you know it’s been a great couple of years. We’re year two of our five-year journey to go through and re-brand all of Lowes Foods. We’re very happy to say we are about half way through the re-branding efforts of existing stores and we’re continuing to ramp opening of new stores, with even a new market entry that we’re doing this year in Greenville, South Carolina. So, things are going very well.
JD: I know you’ve also been expanding your e-commerce platform. Tell us about the success there and how important that’s going to be to your business going forward.
TL: Yes, we see e-commerce continuing to grow in a very strong way out there as consumers get in this whole buy-online-pick-up-in-store, as well as delivery. And so, we’re testing in both arenas. Last year we announced our partnership with Unata to launch a new platform for us. We got that completed in stage one this past September and we’ve seen some very, very nice growth overall. The industry overall has seen a one percent penetration in the e-commerce business these days. We’re happy to say we are two to three times that at this point and continue to see it grow and expand.
JD: Great. I know price and merchandising optimization are a big thing right now. Tell us a bit about what you’re doing there.
TL: Yes, you know we looked at our center store pricing as something that’s across the entire country that center store pricing has been influenced in quite a few different ways. We’ve gone through this past year and we’ve launched a new program called Go For—Go For Lower Prices. We launched it in November and we’ve seen some very, very strong results back for that. Revionics has partnered with us and we’ve done some very, very cool things within their tool to be able to go through and manage this pricing in an ongoing, week-by-week, month-by-month basis to give us that dynamic pricing to really make our consumer be at the center of everything we do.
JD: Sounds great, Tim. Looking at the overall industry, what do you think are going to be the most important issues that grocers are going to be facing in 2016.
TL: You know, 2016 is a year from my position that is going to be a lot change. There will be some acquisitions that will occur, other things will be who’s going to be falling out of the market on the back side. Fresh is going to be a big, strong push for the market overall and there will be continued pressure on the center store side of the business. E-commerce will continue to be adopted by consumers—so again, it’s going to be a year of a lot of change.
JD: Fantastic! We really appreciate you coming out to talk to us.
TL: Great, Jim. We really appreciate it as well.
JD: Thanks very much from Progressive Grocer.