Albertsons announces strategic review of company

[ClownLoach]

Here is more detail about the "accelerated digital transformation" of the company.

https://retailwire.com/discussion/alber ... ast-track/

[storewanderer]

Here is more detail about the "accelerated digital transformation" of the company.

https://retailwire.com/discussion/alber ... ast-track/

They now appear to be playing the game of having lower prices on the website/for pick up orders than the prices in the store (unless 3 of the stores in my area are simply way behind on posting sale tags, which I don't think is the case). Quite a few center store items I was looking at in the store (with absurdly high retails like 48oz Best Foods Mayo for 14.49 in store and no sale advertised in store but online shows a sale at 7.99 or 15oz Hunts Tomato Sauce for 2.79 in store and no sale advertised but online shows a sale at 1.99) are showing as regular price in store but have a sale online.

It appears to me their "digital transformation" involves things like $40 off a $75 online purchase, lower prices online than in-store, and throwing a ton of money at new/unproven technology. We will see how it works out. Race to the bottom... Amazon continues to be in the best position to lose money selling items and subsidize that activity with profits from other operations. These stand alone retailers cannot sustain losses like that.

However I still expect in the grocery business we will see retailers that do not really get involved in this online thing and focus on either having stores with fantastic perimeters/service levels/fresh departments or on the other end of the spectrum hard discounters who price so low that this type of thing is simply not part of the program.

[ClownLoach]

Here is more detail about the "accelerated digital transformation" of the company.

https://retailwire.com/discussion/alber ... ast-track/

They now appear to be playing the game of having lower prices on the website/for pick up orders than the prices in the store (unless 3 of the stores in my area are simply way behind on posting sale tags, which I don't think is the case). Quite a few center store items I was looking at in the store (with absurdly high retails like 48oz Best Foods Mayo for 14.49 in store and no sale advertised in store but online shows a sale at 7.99 or 15oz Hunts Tomato Sauce for 2.79 in store and no sale advertised but online shows a sale at 1.99) are showing as regular price in store but have a sale online.

It appears to me their "digital transformation" involves things like $40 off a $75 online purchase, lower prices online than in-store, and throwing a ton of money at new/unproven technology. We will see how it works out. Race to the bottom... Amazon continues to be in the best position to lose money selling items and subsidize that activity with profits from other operations. These stand alone retailers cannot sustain losses like that.

However I still expect in the grocery business we will see retailers that do not really get involved in this online thing and focus on either having stores with fantastic perimeters/service levels/fresh departments or on the other end of the spectrum hard discounters who price so low that this type of thing is simply not part of the program.

From what I can tell this is the same pricing strategy as Amazon Fresh, but the promotional strategy is reversed. Amazon Fresh is more expensive in store than online... But then they give big in store only promotional coupons.

I still think it is interesting that Amazon had that very large, paid survey about a month ago which basically was to benchmark themselves against Albertsons.

They're both acting completely different... And the same. I still think it isn't a coincidence. By the way they hired a independent third party to administer the survey so technically it wouldn't be collusion with Albertsons.

[storewanderer]

From what I can tell this is the same pricing strategy as Amazon Fresh, but the promotional strategy is reversed. Amazon Fresh is more expensive in store than online... But then they give big in store only promotional coupons.

I still think it is interesting that Amazon had that very large, paid survey about a month ago which basically was to benchmark themselves against Albertsons.

They're both acting completely different... And the same. I still think it isn't a coincidence. By the way they hired a independent third party to administer the survey so technically it wouldn't be collusion with Albertsons.

Well, on the west coast, Albertsons is the dominant competitor. You figure Albertsons is running close to 1,000 stores in CA/OR/WA. Kroger in those states has maybe 450 stores total? The QFCs barely count as a store most are very small. Also not even sure I'd consider F4L/FoodsCo a potential Amazon competitor so Kroger is really almost a non-factor against Amazon in the west. The west is also one of the few regions where Kroger has yet to even start constructing an Ocado site- they are claiming they have 4 sites on their way (2 in Pacific Northwest and 2 in SoCal) to be announced at a later date. Given how quick and eager they are to announce exact sites in places like Austin, Oklahoma City, and various other mid-US areas I am guessing based on the lack of saying where these specific sites are in the Pacific Northwest and in SoCal that said sites do not even exist yet and they are still attempting to find sites.

[ClownLoach]

From what I can tell this is the same pricing strategy as Amazon Fresh, but the promotional strategy is reversed. Amazon Fresh is more expensive in store than online... But then they give big in store only promotional coupons.

I still think it is interesting that Amazon had that very large, paid survey about a month ago which basically was to benchmark themselves against Albertsons.

They're both acting completely different... And the same. I still think it isn't a coincidence. By the way they hired a independent third party to administer the survey so technically it wouldn't be collusion with Albertsons.

Well, on the west coast, Albertsons is the dominant competitor. You figure Albertsons is running close to 1,000 stores in CA/OR/WA. Kroger in those states has maybe 450 stores total? The QFCs barely count as a store most are very small. Also not even sure I'd consider F4L/FoodsCo a potential Amazon competitor so Kroger is really almost a non-factor against Amazon in the west. The west is also one of the few regions where Kroger has yet to even start constructing an Ocado site- they are claiming they have 4 sites on their way (2 in Pacific Northwest and 2 in SoCal) to be announced at a later date. Given how quick and eager they are to announce exact sites in places like Austin, Oklahoma City, and various other mid-US areas I am guessing based on the lack of saying where these specific sites are in the Pacific Northwest and in SoCal that said sites do not even exist yet and they are still attempting to find sites.

Yet those 450 or so Kroger units probably bring in more revenue than the 1000 Albertsons units on the West Coast.

[Bagels]

From what I can tell this is the same pricing strategy as Amazon Fresh, but the promotional strategy is reversed. Amazon Fresh is more expensive in store than online... But then they give big in store only promotional coupons.

I still think it is interesting that Amazon had that very large, paid survey about a month ago which basically was to benchmark themselves against Albertsons.

They're both acting completely different... And the same. I still think it isn't a coincidence. By the way they hired a independent third party to administer the survey so technically it wouldn't be collusion with Albertsons.

Well, on the west coast, Albertsons is the dominant competitor. You figure Albertsons is running close to 1,000 stores in CA/OR/WA. Kroger in those states has maybe 450 stores total? The QFCs barely count as a store most are very small. Also not even sure I'd consider F4L/FoodsCo a potential Amazon competitor so Kroger is really almost a non-factor against Amazon in the west. The west is also one of the few regions where Kroger has yet to even start constructing an Ocado site- they are claiming they have 4 sites on their way (2 in Pacific Northwest and 2 in SoCal) to be announced at a later date. Given how quick and eager they are to announce exact sites in places like Austin, Oklahoma City, and various other mid-US areas I am guessing based on the lack of saying where these specific sites are in the Pacific Northwest and in SoCal that said sites do not even exist yet and they are still attempting to find sites.

Yet those 450 or so Kroger units probably bring in more revenue than the 1000 Albertsons units on the West Coast.

Kroger crushes Albertsons in the Los Angeles-area, but Albertsons dominates most of the West. I haven’t looked in awhile, but I doubt much has changed: in the late 2010s, Abertsons bettered or equaled Kroger’s revenue per sq ft. They even surpassed Kroger in Las Vegas, which is pretty remarkable given that the Albertsons-branded locations were considered zombie stores for many years. Of course, they’re the 800 lb. Gorilla in NorCal.

In 2019, Kroger had 130 fewer stores in SoCal but greater market share. This is almost entirely Los Angeles - Albertsons betters Kroger in San Diego & both chains have largely given up on the Inland Empire and desert.

I’m sure Vons has some core stores around LA, but it’s noticeable in Orange County for example just how badly Albertsons performs. Very little traffic compared to Smith’s.

[babs]

From what I can tell this is the same pricing strategy as Amazon Fresh, but the promotional strategy is reversed. Amazon Fresh is more expensive in store than online... But then they give big in store only promotional coupons.

I still think it is interesting that Amazon had that very large, paid survey about a month ago which basically was to benchmark themselves against Albertsons.

They're both acting completely different... And the same. I still think it isn't a coincidence. By the way they hired a independent third party to administer the survey so technically it wouldn't be collusion with Albertsons.

Well, on the west coast, Albertsons is the dominant competitor. You figure Albertsons is running close to 1,000 stores in CA/OR/WA. Kroger in those states has maybe 450 stores total? The QFCs barely count as a store most are very small. Also not even sure I'd consider F4L/FoodsCo a potential Amazon competitor so Kroger is really almost a non-factor against Amazon in the west. The west is also one of the few regions where Kroger has yet to even start constructing an Ocado site- they are claiming they have 4 sites on their way (2 in Pacific Northwest and 2 in SoCal) to be announced at a later date. Given how quick and eager they are to announce exact sites in places like Austin, Oklahoma City, and various other mid-US areas I am guessing based on the lack of saying where these specific sites are in the Pacific Northwest and in SoCal that said sites do not even exist yet and they are still attempting to find sites.

Fred Meyer plus QFC makes Kroger #1 in market share in the Puget Sound market. Kroger and Albertsons are just about tied in the Portland market. I don't know where you are getting you info from that Albertsons is dominating. It's a lot closer than that. In northern California Kroger has no stores so that's obvious. I haven't checked recently but in Southern California I believe Kroger and Albertsons are close in market share there as well.

[storewanderer]

Kroger crushes Albertsons in the Los Angeles-area, but Albertsons dominates most of the West. I haven’t looked in awhile, but I doubt much has changed: in the late 2010s, Abertsons bettered or equaled Kroger’s revenue per sq ft. They even surpassed Kroger in Las Vegas, which is pretty remarkable given that the Albertsons-branded locations were considered zombie stores for many years. Of course, they’re the 800 lb. Gorilla in NorCal.

In 2019, Kroger had 130 fewer stores in SoCal but greater market share. This is almost entirely Los Angeles - Albertsons betters Kroger in San Diego & both chains have largely given up on the Inland Empire and desert.

I’m sure Vons has some core stores around LA, but it’s noticeable in Orange County for example just how badly Albertsons performs. Very little traffic compared to Smith’s.

Where have you seen that Smiths is lower market share than Albertsons in Las Vegas? That would put Smiths in third place, which I do not think is correct (Kroger labels Smiths as having #1 or #2 share in Las Vegas in their last fact book). Obviously the other #1 or #2 position goes to Wal Mart. Traffic counts have improved at Albertsons in Las Vegas since Southwest Division took the stores over from SoCal Division however they are still not having the traffic of Smiths, generally speaking. There are some bright spots for Albertsons in Las Vegas but for the most part Smiths still runs much busier stores. Both have large stores in the market, generally speaking. Smiths did pad its share a bit by reopening some F4L Stores as Smiths. If you had it where it was just Smiths (excluding F4L) then the share of Albertsons would be higher because the store count is a lot higher. Smiths has 37 stores in the Las Vegas market at this time I believe; Albertsons (including Vons) has 41 stores. Las Vegas has most of Smiths best performing stores.

I didn't realize what a stinker Vons is in Orange County. Based on the complete joke dump locations I visited, especially around Disneyland, I should have come to that conclusion. I just assumed there must be nicer stores with more customers around that I just didn't happen to visit. Kroger definitely seems to underperform in San Diego and opted to close a number of locations rather than attempt to turn them around.

[ClownLoach]

Kroger crushes Albertsons in the Los Angeles-area, but Albertsons dominates most of the West. I haven’t looked in awhile, but I doubt much has changed: in the late 2010s, Abertsons bettered or equaled Kroger’s revenue per sq ft. They even surpassed Kroger in Las Vegas, which is pretty remarkable given that the Albertsons-branded locations were considered zombie stores for many years. Of course, they’re the 800 lb. Gorilla in NorCal.

In 2019, Kroger had 130 fewer stores in SoCal but greater market share. This is almost entirely Los Angeles - Albertsons betters Kroger in San Diego & both chains have largely given up on the Inland Empire and desert.

I’m sure Vons has some core stores around LA, but it’s noticeable in Orange County for example just how badly Albertsons performs. Very little traffic compared to Smith’s.

I didn't realize what a stinker Vons is in Orange County. Based on the complete joke dump locations I visited, especially around Disneyland, I should have come to that conclusion. I just assumed there must be nicer stores with more customers around that I just didn't happen to visit. Kroger definitely seems to underperform in San Diego and opted to close a number of locations rather than attempt to turn them around.

I can only think of maybe two decent Vons branded stores in North OC. They have really let the Vons brand perish there. Any decent store was rebranded as Pavilions long ago, and it definitely seems the Albertsons branded stores that remain after the merger are better overall than Vons. In South OC there is only one Vons left and it is in San Juan Capistrano; they recently gave it the light "repaint only" remodel from the regular lifestyle decor where the same letters and signs get reused with new paint behind them. I wonder if the only reason for not rebranding it when they did the refresh was that they wanted to leave at least one store in the market with the Vons name?

Those stores around Disneyland are especially awful. The one off Haster Ave. was famously roasted on another thread for having hanging posters with pictures of lifestyle decor over blank cream beige walls. They finally gave it a new colorful lifestyle decor package but the core store is the same old dump. I suspect that they are waiting for a developer to offer them a fortune to demolish the store and build apartments despite all the vacant land on Harbor where they stupidly cleared out homes for resort hotels that never got off the ground. I'm sure those will stay zoned for hotels and will continue to be dirt lots for decades. My guess is that they own the building for the Haster store as well as the store north of Disneyland in downtown Anaheim otherwise those both would have closed many years ago. Zero rent makes a big difference... Until someone offers you more profit all at once than the store makes in a decade... Then the bulldozers roll.

[Super S]

Fred Meyer plus QFC makes Kroger #1 in market share in the Puget Sound market. Kroger and Albertsons are just about tied in the Portland market. I don't know where you are getting you info from that Albertsons is dominating. It's a lot closer than that. In northern California Kroger has no stores so that's obvious. I haven't checked recently but in Southern California I believe Kroger and Albertsons are close in market share there as well.

Outside of the larger metro areas, there are many areas where Albertsons and/or Safeway has stores, but Fred Meyer and QFC are nonexistent. Fred Meyer/QFC actually has no stores in Eastern Oregon, where Safeway and Albertsons have many. Safeway/Albertsons does have stores in many smaller towns in both Washington and Oregon and, by store count, has far more locations.