The Pantry's Lifestyle Change
New CEO's holistic marketing approach, tailoring store's assortment
Published in CSP Daily News
CARY, N.C. -- The Pantry's CEO of the past year, Dennis Hatchell is taking a holistic approach when it comes to which categories deserve the most attention.
"It isn't just fresh," he told CSP Daily News recently, referring to the convenience store chain's previous marching orders. "We've got to sell everything inside these four walls as efficiently as we can. … It's more important we have what the customers want, and that will take care of the performance."
Enter the Lifestyles Initiative, a merchandising program that aims to tailor a store's assortment to local demographics. Ultimately, three-quarters of Pantry sites will be sorted into one of nine segments: Hispanic, college, beach, urban, rural, military, interstate, interstate/truck stop and affluent. The remaining quarter would be reserved as a traditional store. As of press time, the chain was still in the initial stages of the rollout, with 187 Hispanic stores, 120 college locations and 47 beach sites.
As Hatchell sees it, the Lifestyles Initiative is one way to deal with the hodgepodge of store sizes and locations that The Pantry, dba Kangaroo Express, collected during its merger and acquisition heydays. "We have all these different stores in all of these different cities, different situations--on the highway, near the beach, etc.--so if you homogenize that, you're going to miss the boat," he said.
"If you put in what everyone who shops this store really likes to see, and they feel like it's a good offer, then they're going to buy it and keep coming back, and the store will prosper."
The Pantry is approaching localization from a few directions, pulling demographic data from Spectra Data Group while also relying on feedback from store management.
"Spectra will tell you who is living around the store, but that doesn't tell you who's walking through the front door," Jon Bratta, vice president of merchandising, packaged goods, told CSP Daily News. "But when you look at the customers in the store, we saw a big need for that product. We brought that product in to try to be relevant to this particular store for the customers coming through."
So, for example, a beach location would stock expanded sun care products and body boards, while an affluent site might have an expanded selection of craft beer and wine.
"It's about being local and relevant for the customers in our store," Bratta said. "It's about taking store-level feedback, combining it with Spectra and saying, 'OK, how can we optimize the assortment and be more relevant to the customers at every store?' It evolves and gets better every day."
While the localization has been mostly on the packaging side, The Pantry is incorporating it into the fresh side as well, such as Mexican pastries in the baked-goods case in a Hispanic site.
A visit to a recently remodeled site in the Raleigh, N.C., market suggests noticeable improvement from previous concepts, yet also a need to further clarify the basket of retail concepts.
The site is aimed at Hispanics and a line of popular ethnic salty snacks is headlined with: "Botanas que conoces y amas" (which translates into "Snacks you know and love"). But the ethic flavoring is subtle and sporadic, found in the snacks and fresh-baked session but largely absent in the cold vault, general merchandise, tobacco and prepackaged foodservice. The store also features a large general-merchandise section that hints at a beach store, with everything from sunglasses to remote-controlled helicopters retailing for $29.99.
The thematic concepts, still in their infancy, are likely to be furthered developed and distinguished.
Read more about Hatchell's goals for The Pantry in the May issue of CSP magazine.