Product category:
Market research
News Release from: TNS Global
Edited by the Marketingservicestalk Editorial
Team on 30 November 2007
Tesco's US Fresh and Easy stores will be
a 'hit'
Fresh and Easy's convenience-focused format potentially represents a significant threat to the US food retailing industry, predicts TNS Global.
Fresh and Easy's convenience-focused format potentially represents a significant threat to the US food retailing industry as the concept offers smaller stores, easy access, more ready meals and 'grab-and-go' items Rapid expansion across the United States will be a key sales driver for the retailer
This article was originally published on Marketingservicestalk on 24 Oct 2007 at 8.00am (UK)
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By 2011, TNS Retail Forward estimates that Tesco could be a $4 bn retailer in the United States with 500 stores.
And, TNS Retail Forward believes that sales could reach $10 bn by 2015 positioning Fresh and Easy among the top 10 supermarket retailers in the country.
Fresh and Easy's format fulfills several different shopping modes and occasions including fill-in trips, immediate consumption, 'grab-n-go' and quick replenishment.
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TNS Retail Forward believes Fresh and Easy's small-size advantage gives it the opportunity to almost double space productivity per square foot compared with supermarket industry averages.
The average size of a US supermarket is more than three times the size of Fresh and Easy's 10,000 sq ft stores.
TNS Retail Forward predicts that Fresh and Easy could generate sales of $900 per square foot per store, nearly twice the supermarket average.
"The combination of Fresh and Easy's smaller stores, self service tills and ready-to-cook meals has direct appeal among US shoppers whose primary concern is convenience," said Jennifer Halterman, senior consultant at TNS Retail Forward.
"There is demand for this type of concept, and we expect other U.S.
retailers to be watching Tesco closely for ideas on how to tap into this buoyant market.
"Fresh and Easy's smaller store size gives it an ideal formula to replicate quickly throughout the United States".
Fresh and Easy stores also aim at a variety of shopper segments.
They attract the value shopper through affordability, as well as the upscale shopper through a gourmet offer.
Unique merchandising and marketing tactics also give shoppers inspiration on how to pull together quick and easy meals that appeal to a variety of tastes.
"The biggest driver of the Fresh and Easy philosophy is the prepared foods selection, with stores dedicating a quarter of their 'fresh' area to these products," commented Mary Brett Whitfield, Senior Vice President with TNS Retail Forward and Director of the Retail Forward Intelligence System.
"The idea of having 'ready-to-go meals' that are high quality, fresh, healthy and cost effective means that this type of meal option has the power to directly compete with restaurants.
"Fresh and Easy's arrival is part of an unfolding shake-up in the competitive food retailing landscape.
"We will need to wait and see what other retailers will do to respond to these changes in the market".
TNS Retail Forward is part of TNS' Retail and Shopper Insights area of expertise, which provides clients with the wide-reaching intelligence, actionable insights, and effective strategies they need to boost brand presence and equity, drive category and retail sales growth, differentiate from competitors, and implement innovative, customer-focused solutions for retail.
Retail and Shopper Insights inform TNS' clients about the multiple moments of truth, the success and failure points of a brand, within the entire consumer purchasing journey.
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