Who is Harris Teeter and how do they know so much?
In retail, it is easy to get “stuck in the ruts”. And, when looking for state of the art, it’s all too easy to focus on the “big names” like Amazon, Best Buy or Walmart. One of our core tenants in IMS Retail University workshops is that you have to step outside of your channel and comfort zone to find best practices. Harris Teeter is a classic case example of why focusing detail and measurement are retail critical success factors.
Harris Teeter – A top competitor from a tough channel
Harris Teeter is a grocery store chain of just over 200 stores located in the south eastern United States. Harris Teeter does a respectable $3 billion plus in sales, but is a mere blip compared to Walmart’s $ 400+ billion plus in annual revenue. Simply said, Harris Teeter can never compete with Walmart on price or volume, especially in the grocery store channel with razor thin margins!
Differentiate or Die! – A case of innovation to Survive
Harris Teeter grew out of a family owned business. Like many regional players, they could have been easily swallowed up by the big boxes like Walmart or the national grocery store chains. Harris Teeter has survived largely through differentiation focused on service. Teeter firsts are very consumer centric, focused on experience, not products:
- Was one of first to offer air conditioning in stores
- Pioneered one of the first widespread loyalty cards
- Led way with child restraint belts in shopping carts
Harris Teeter has historically been able to differentiate itself from price based competitors by providing exceptional customer service and branded departments. But will this be successful in the current economy where even Walmart is losing share to lower prices at “dollar” stores?
Survival Today – E3 … Excellent Execution Everyday
From the people I know who shop the “H.T.”, they are still in love with the service and experience. And, most proudly carry and use their VIC – “Very Important Customer” loyalty card. What HT shoppers probably don’t realize is what goes beyond behind the scenes to create and manage a personalized experience. Best practice today requires a lot of infrastructure and intelligence to drive execution excellence.
Retail is Detail … and requires a lot of measurement!
Harris Teeter continues to innovate and lead the way on consumer experience on the store floor. But it is HT’s deep commitment to data and measurement that enable them to quickly refined and adapt to consumer needs and purchasing patterns.
Harris Teeter not only survives, but thrives because they are committed to best practices in measurement that few retailers even consider.
Fred Morganthall, President of Harris Teeter, recently gave a speech at N.C. State University College of Management. Below are some excerpts from Morganthall’s speech that show the depth and precision of what HT does routinely, and consistently in order to execute exceptionally:
“We may not know you by name, but we know you by your VIC card number, and we sure know you by what you buy. ... When the recession hit, we started seeing sales of pot pies, TV dinners, peanut butter, and macaroni and cheese spike. We were able to make our decisions pretty rapidly. We had to concentrate not on dollar sales but on unit sales - on customers and what they purchased."
"We measure everything. We mystery shop ourselves and our competition because we want to know what kind of service you get at Food Lion. We measure time in line. We do Web surveys. We do phone surveys. ... When you're a new associate with us, as a bagger, you get 30 hours of training."
What gets measured … get done … can be changed!
Fred Morganthall’s speech is music to this measurement guy’s ears! All too many of today’s retailers make “arm chair quarterback” decisions from POS cash register data. Hey, there is nothing wrong with market basket analytics … I’m a big fan and have written previous posts. A few of them are: Differentiate or Die! … METRICS – Beyond “Customer Sat” – Are you measuring the right things? … 7 Metrics for measuring “loyalty” that counts.
How many retailers out there today mystery shop themselves and the competition? How many measure customer wait time in line? The key of course is turning data into intelligence and action. Perhaps the most significant factoid from the speech was the fact that even a new associate with the position of “bagger” gets 30 hours of training!
Brian Dunn the CEO of Best Buy is scrambling to refocus Best Buy on customer centric service focused on “connections” not just product, which is addressed in this article.
Mr. Dunn, it would serve you well to step outside of your CE channel and comfort zone to examine Harris Tweeter’s best practices that enable them to thrive in the shadow of Walmart and the mega chains.
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