Walk into a supermarket today and you’re faced with nearly 39,000 items to choose from.[1] That number sounds overwhelming, yet grocery chains and retail architects make it simpler than ever to cross items off your shopping list. Easy-to-navigate stores, e-commerce integration, apps, self-checkout and pick-up service are just a few of the salient features that contribute to enhanced customer experience and retail design for grocery stores in 2018.
So how did we get here?
Over the past 50 years and before, the shopping experience and retail architecture have evolved with economic, technological, and social trends. And that evolution has shaped the reimagination of the retail design experience. As retail architects, we’re interested in not only how we got here, but where we’re going.
Postwar Proliferation of Supermarket Architecture
After World War II, the construction of supermarkets exploded across America. Food production advancements, the popularization of home refrigerators and suburban development allowed families to more effectively store perishable food in homes.[2] Supermarkets proliferated to meet the demand. In the postwar years, large supermarkets, while comprising only 5% of all food retail outlets, reported nearly half the sales volume. As a result, many smaller independent grocery stores shuttered.[3]
1960s and Grocery Store Architecture Design
With the 1960s came a renaissance in grocery store architecture. Standardized retail architecture designs previously used were repurposed and refined. Chains like A&P created colonial-themed stores, while others like Safeway incorporated recognizable glass arches into their retail architecture designs.[4] The nation flourished economically in the 60s, and Americans demanded a more diverse array of items in grocery stores. To compete with the burgeoning fast food industry, many supermarkets expanded retail grocery designs to include delicatessens and bakery departments. Many also widened the array of products and services offered, and focused more on quality.[5]
Grocery Store Architecture and Technology in the 1970s
The 1970s witnessed the rise of technology in grocery retail experience. During this period, the Universal Product Code (UPC) was introduced — an innovation that directly impacted planning supermarket design in retail architecture by allowing grocers to precisely estimate how much stock of a particular product was required. Another significant retail breakthrough followed in 1974 with the checkout scanner.
Due to economic stagnation in the 70s, little attention was given to retail architecture, customer experience and grocery store design. An overall spartan aesthetic, including austere grocery store displays, minimalist food department layouts, metal shelving and cartoned goods contributed to the image that the grocery chain was saving the customer money. At the same time, supermarkets began promoting discounts and competing fiercely on price. This price slashing was another reason supermarkets focused less on retail design and customer experience, and more on offering consistently low pricing. In addition, the late 1970s witnessed the appearance of the wholesale club, a format that included bulk and retail offerings.[6]
1980s: Food, General Merchandise and Pharmacy Items Under One Roof
With the economic recovery in the 1980s, supermarket chains built massive retail architecture spaces to draw customers.[7] In 1988, Walmart, who previously focused primarily on general merchandise, opened its first supercenter store — marking the company’s entrance into the grocery arena. Soon, other general merchandisers like Kmart and Target followed suit.[8] The supercenter format allowed retailers to offer food, general goods and pharmacy items in one place.
1990s and Grocery Retail Architecture Formats
By the mid 1990s, supermarkets had taken on a wider variety of formats. The Food Institute identified 14 unique store types that materialized at this time, including conventional supermarkets, superstores, super warehouse stores, wholesale clubs, mini-clubs, convenience stores and supercenters.
Conventional supermarkets were categorized as stores with 9,000 items or more and included a deli and bakery. These stores comprised 26% of the industry’s total volume in the mid-90s, while, just a little over a decade prior, they accounted for more than 50% of the industry’s total volume. Superstores, which were slightly larger than a conventional supermarket, were classified as stores with at least 30,000 square feet in architectural space and offered more than 14,000 items. Larger, super warehouse stores spanned an average of 100,000 square feet.
Wholesale clubs were classified as 90,000 square foot stores who specialized in retail and wholesale, and mini clubs at about half the size carrying about 60% as many items as their larger counterparts. On the smaller side, convenience stores were characterized as shops, often attached to gas stations, offering a selection of everyday grocery items, general merchandise and hot food to go.
Then there was the supercenter, averaging 150,000 square feet with 40% of its space dedicated to grocery items — a format that would serve as a vehicle for growth in the retail grocery industry.
Grocery Retail Design And Architecture Trends After 2000
By the turn of the millenium, Walmart, with the supercenter retail design format and grocery selection, emerged as the nation’s largest retailer. In 2000, the retail giant had 11.1% of U.S. grocery industry sales across 800-plus supercenters.[9]
Simultaneously, grocery stores increasingly turned to sustainable architecture design. According to the Food Marketing Institute’s 2007 Facts About Store Development report, more grocery retailers had embraced sustainable designs and architecture. 21.6 percent of participants reported green building is a goal for their organizations, and 58.5 stated their organizations were considering green building options.[10]
Additionally, more emphasis was placed on streamlining the checkout process through self-checkouts. To shed some light on the increase in popularity, 6 percent of supermarkets in U.S. provided self-checkout lanes in in 1999; by 2007, 95 percent offered them.[11] In 2013, Walmart installed 10,000 self-service kiosks in stores across the country. [12]
Today, we are witnessing the convergence of the offline and online grocery retail worlds. E-commerce has changed the way customers shop and interact with retailers. To gain customer loyalty, many retailers are finding ways to make their e-commerce plans convenient and valuable to retain customers. Many make it easy to order groceries online or through a mobile app and pick them up when it’s convenient for you. Walmart has expanded their online grocery service to over 150 brick and mortar locations.[13] The Instacart app allows you to order groceries for delivery from major stores. Even online retailers have entered into the grocery retail sector.[14]
As we watch the offline and online worlds collide, retail architecture and retail design experience will continue to play a seminal role in facilitating the customer experience, and by offering captivating retail experiences that can be broadcasted through social channels. When it comes to the future of retail architecture and grocery store design, we are already seeing retailers downsize with smaller buildings, provide more comprehensive online selections, and integrate cutting-edge technology. Shoppers demand convenience and fresh selections. E-commerce can improve convenience, specifically for dry-goods, but most customers still want to see and touch the fresh foods prior to purchase.
At SGA, keeping up with emerging customer shopping habits and technological advancements helps our clients grow. Essential components of retail design, such as clear signage, fixture layouts, quality lighting and materials are increasingly important. We bring value to not only to this aspect of retail design and architectural planning, but also in planning considerations for grocery pick-up, self-checkout, and facilitating co-partnerships with third party retail businesses to complete customer orders. Clients across the country rely on this understanding and experience in grocery retail design and architecture to bring value to their projects from start to finish.
References:
[1] Supermarket Facts. (n.d.). Retrieved March 20, 2018, from https://www.fmi.org/our-research/supermarket-facts
[2] Mayo, J.M. 1993. “The American Grocery Store: The Business Evolution of an Architectural Space.” Westport, CT: Greenwood Publishing Group, Inc.: 77-233.
[3] Grocery and Supermarket. (2003, September 15). Retrieved March 20, 2018, from http://adage.com/article/adage-encyclopedia/grocery-supermarket/98499/
[4] Groceteria. (2018, February 18). A Quick History of the Supermarket. Retrieved March 20, 2018, from http://www.groceteria.com/about/a-quick-history-of-the-supermarket/
[5] Mayo, J.M. 1993. “The American Grocery Store: The Business Evolution of an Architectural Space.” Westport, CT: Greenwood Publishing Group, Inc.: 77-233.
[6] Structural Changes in Food Retailing: Six Country Case Studies. (2009, November). Retrieved March 20, 2018, from https://www.aae.wisc.edu/fsrg/publications/Monographs/!food_retailingchapter7.pdf
[7] Grocery and Supermarket. (2003, September 15). Retrieved March 20, 2018, from http://adage.com/article/adage-encyclopedia/grocery-supermarket/98499/
[8] Mayo, J.M. 1993. “The American Grocery Store: The Business Evolution of an Architectural Space.” Westport, CT: Greenwood Publishing Group, Inc.: 77-233.
[9] Grocery and Supermarket. (2003, September 15). Retrieved March 20, 2018, from http://adage.com/article/adage-encyclopedia/grocery-supermarket/98499/
[10] (n.d.). Retrieved March 20, 2018, from https://www.fmi.org/newsroom/news-archive/view/2008/04/01/fmi-facts-about-store-development-2007-retailers-design-build-and-remodel-with-sustainability-in-mind
[11] DePillis, L. (2013, October 09). Forget the haters. Grocery self-checkout is awesome. Retrieved March 20, 2018, from https://www.washingtonpost.com/news/wonk/wp/2013/10/09/forget-the-haters-grocery-self-checkout-is-awesome/?utm_term=.b80fe0a97794
[12] Thibodeau, P. (2013, January 16). Walmart, jobs and the rise of self-service checkout tech. Retrieved March 20, 2018, from https://www.computerworld.com/article/2494214/retail-it/walmart–jobs-and-the-rise-of-self-service-checkout-tech.html
[13]http://s2.q4cdn.com/056532643/files/doc_financials/2016/annual/2016-Annual-Report-PDF.pdf
[14] Weise, E. (2018, January 22). Amazon opens its grocery store without a checkout line to the public. Retrieved March 20, 2018, from https://www.usatoday.com/story/tech/news/2018/01/21/amazon-set-open-its-grocery-store-without-checkout-line-public/1048492001/