One-on-One with Meg Major
Welcome back to Endcap, John. Our
cover story delves deeply into the
rise of discount grocery retailers.
What do you make of their here-to-stay encroachment and how are you
encouraging IGA’s indies to compete?
John Ross: I think the heart of this
question is about understanding and
serving shoppers. If you are a low-income
shopper who is unable to afford to shop
a Whole Foods, then your best option is
to shop a discount retailer, sometimes
under duress. We saw this happen during
the Great Recession. As the economy
improved, shoppers whose economic
fortunes improved with it had acquired
firsthand experience of the allure of heavy
discounters, and research suggests that
many shoppers kept them as part of their
regular shopping arsenal.
On top of that, shoppers became very
smart and very informed with the rise of
information that allowed any shopper to be
infinitely smarter about what’s going on at
retail. And in this environment, we retailers
need to be smarter, too, by adjusting how
we market and how we merchandise to
make sure we’re serving today’s smart
shoppers. The payoff comes with loyalty, a
rise in incremental baskets and increased
shopper trips. And it also allows you to
have a much deeper relationship with that
shopper because you’re serving all of their
needs. It’s an enormous opportunity for the
What strategic initiative are you pushing
the hardest with IGA’s operators?
We have an obligation to serve our
neighborhood. And in that neighborhood,
there are some shoppers that require
discounts, and there are others that view the
thrill of the discount as part of how they’re
wired, so they’re excited, regardless of their
income. Independents must embrace the
obligation to serve their neighborhood,
which requires figuring out how to serve low-income customers, high-value customers
and high-service customers.
Aldi is a pacesetter in areas deemed
important by consumers today, including
sustainability. How much of an influence
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98 AUGUST 2019 WINSIGHT GROCERY BUSINESS
John Ross is CEO of IGA, the
largest group of independent
grocery retailers in the world.
do you see it having on the remainder of
the top grocery banners?
You have to give a ton of respect to an
international retailer that’s come to the
United States and figured out a way to grow
and thrive and prosper. If you look at Aldi’s
stores today versus what they were a few years
ago, they have changed dramatically. And
they do—and have done—what great retailers
always do: They humbled themselves in
the face of the American shopper, they paid
attention to what was important to them, and
they figured out a way to adapt their European
model to our marketplace in a way that’s
helping them to grow.
Do you believe online is a supplement or
a replacement for in-store shopping?
I don’t think the shopper is making any
distinction in their mind between in-store,
pickup and delivery. To them, it’s all shopping
and they’re making choices about what’s the
most efficient way in order to get the products
that they need. And they are proving they
want to move seamlessly between what are
to us two very different channels. They want
to move seamlessly in a way that fits their
needs by day, by hour and by occasion. And
the retailers that approach it with an attitude
of, “My job is to get the product to you the
way you want it. You tell me what you want
and I’ll figure out a way to deliver it,” are the
ones that are building integrated solutions.
They’re not so worried about the cost for an
individual e-commerce transaction but are
instead looking at the total loyalty effect.
What do you make of the so-called retail
apocalypse, including how it relates to
The retail apocalypse is a great headline,
but the data doesn’t bear it out. And it
frustrates me when we as an industry use
this language that’s self-defeating. If you
look at the changing demographics and
what shoppers want, it’s higher service,
prepared meals, experience in their store
that makes them feel like part of a family and
people who care about their health. Today’s
shoppers’ needs and expectations play right
into independents’ sweet spot. So I believe
this is an independent renaissance—not an
apocalypse. Read the full conversation at WinsightGroceryBusiness.com.