“You see, these tables here probably aren’t exactly what we needed,” says Reasor, whose father started the business in 1963. “And these cases aren’t my favorite. We probably have as much sushi as anybody in the area, but this case, in my opinion, just doesn’t display it that way.”
As the newness of Reasor’s flagship store is slowly beginning to wear off, the next round of improvements is already underway, continuing the cycle of never-ending changes — in store design, branding, merchandising, perception and more — that defines today’s supermarket industry, especially those retailers that reside with Reasor’s on the smaller end of the spectrum.
“It’s almost like Grocery 101,” says Reasor, the company’s CEO. “We’re tickled to death with the store and learning from all the things we’re doing. We’re learning what works and what doesn’t.”
Such is life in the supermarket industry, especially for those retailers who fall somewhere between mon-and-pop and nationwide behemoths. That includes Reasor’s. The Tahlequah, Oklahoma-based retailer operates 20 locations in the northeastern corner of the state, most of them in Tulsa.
“We changed three years ago and now we’re evolving again and beginning to change more,” Reasor says. “That’s the grocery business.”
‘The market was changing’
The world is absolutely shrinking, and Middle America is by no means behind the times, but it would be fair to say some trends take just a bit longer to travel here to some smaller markets. While larger metros have long enjoyed innovative foodservice offerings from supermarket retailers, Reasor’s was a bit of a trendsetter when it unveiled its Brookside store in Tulsa in 2015.
A Whole Foods sits next door — less than 500 feet separates the buildings — and a Trader Joe’s is down the street, but when Reasor’s bought and remodeled the former Albertsons building, it brought a unique look, feel and dining area to the Tulsa supermarket scene. According to the Tulsa World, Walmart dominates the metro’s supermarket scene, gobbling up for them half of the market share.
“The whole genesis of the store was that the market was changing,” Reasor says, noting that the company knew it must adapt to consumer trends and offer a fresh perspective in order to thrive. “Even in our company, we’re going to be looking at stores in the next five, 10 years, as the leases come up, are we going to rebuild there? How do we take a 75-80,000-square-foot store and get it to this size? This is where it’s headed.”
So Reasor’s went to work, hiring marketing consultants, building ideas and seeking the advice of a demographic anthropologist, who would spend weeks at a time in Tulsa, compiling a list of traits, words, colors and themes to describe the area.
“They really like the word ‘prairie,’ that but was not something we associated with here,” Reasor says. “It was a little too rustic.”
So they settled on a look that is both downhome and modern. Customers walk in to the store under a vaulted, wood ceiling with large wood beams. A fireplace and tables of seasonal kitchenware and decorative items line the walkway to the prepared foods area.
The state of Oklahoma doubles as a steaming pot in the logo that dominates the fresh perimeter. “Hometown Fare” and the store’s theme revolves around the word “table.” Bring Your Table to Life and Gather Around the Table are used throughout and fresh items are marketed as “table-ready.”
“We knew we needed to change the direction we were going to meet where the customer is headed,” says Reasor. “This was going to be a prototype that we wanted to play with, because what’s going to happen is that you’re going to see the grocery department begin to shrink. There’s still going to be a need for hamburger buns and mustard and mayonnaise and those things, but you’re going to see the produce, the meat, the cheese, the whole eating experience is taking over.”
|||READ MORE: 'The customer dictates it'|||
What Reasor didn’t plan on, however, was such rapid, continued change in the market. The new store was, and is, a hit in the community, and the company has begun to remodel some of its existing stores. But the Brookside location is still very much a work in progress, where the company is monitoring what has worked well and what could use an update.
“All that planning and remodeling sounds great and that was four or five years ago and they put this together and we began to change stores to these colors and this look, but what’s happening is the marketplace is changing even faster now,” Reasor says. “We’ve put this all together and we’ve got the marketing behind it and this is where we are. Now we’re beginning to massage it and play with it a little bit.”
What has worked and what hasn’t? Start with the prepared foods area, which Reasor calls “the toughest nut to crack.”
The Oklahoma-inspired menu has proven a hit. Freshly grilled flank steak, hand-made pot pies (with Tippin’s pie crust), made-to-order sandwiches and more all do well.
“A lot of those items — the sandwiches, the pot pies — those are things we tried to tie to Oklahoma and this area,” Reasor says. “And people really seem to like it.”
But he says the way people purchase and consume the food was not what the company expected. Tuesday nights, for example, are Taco Tuesdays, and Thursday nights feature prime rib specials.
“Our thought was to bring all these tables and umbrellas out front and give people a place to gather and hang out while they eat,” Reasor says. “But what we’re finding is that most people are wanting to take it to-go. The don’t want to stay here. It’s not that the food isn’t good or that the store isn’t nice enough, that’s just how they prefer to do it.
“We’re trying to learn from that and trying to figure out how we can ramp that up and figure out how we can do it at other stores.”
With the increased emphasis on the perimeter, the center of the new store shrunk. With less real estate comes fewer products.
That has led to what Reasor says the company feared the most. “The first thing we noticed was that people would come in and say ‘Well, we absolutely love the store, but we can’t find certain items that you have at your bigger stores,’” he says. “We’re more limited to what we can do in grocery in this format. That’s been our challenge; to work through those products and try to get the mix just right.”
Reasor says much of the growing pains can be attributed to something the industry as a whole has struggled to nail down — how to attract the younger consumers. He says the under-40 crowd, perhaps not surprisingly, is shopping much differently than their parents did. It’s not a matter of stores not having the things they want, it’s just that they shop in a much different way.
The company has noted all of this and is in the process of adapting even more, strengthening what has worked well and tweaking what hasn’t quite lived up to expectations.
“You crawl, you pull up, you walk before you run. And that’s kind of where we are right now. We’re beginning to understand some things,” Reasor says. “We’ve tried some stuff with some of the other stores, which is a pretty good commitment equipment wise, and we have stores that work and others that don’t.
“We don’t dictate that. The customer dictates it by what they buy. Every time they come in, if there aren’t enough people buying something, we’re not going to carry it. We’re going to change.”
The store’s prepared foods department, deli and specialty cheese section create a sort of long, obtuse triangle. In the middle sits a vibrant, diverse produce section that Reasor prides himself on.
“We sell more organic produce than anybody in the state of Oklahoma,” he says, before pausing. “But we don’t get credit for it.”
Instead, he says, consumers will make a stop at another nearby store to get organic produce before coming to Reasor’s for fresh foods and staples.
“From a branding standpoint, customers don’t perceive us that way. They think Sprouts and Whole Foods are the ones with all the organic produce. Percentage wise, Sprouts doesn’t have as much organic as we do,” Reasor says. “But there are still certain things that people will go right around the corner to Whole Foods for because we don’t have the perception of having those same things, even though we do.
“Those are some of the perceptions we’re trying to work through. You can find anything you want here from a health standpoint.”
Keeping up with the branding of a national giant like Whole Foods can be tough, as can be staying even with Walmart or Target when it comes to online shopping. “We’ve had online shopping for a long time, but now the online piece has picked up more outside us,” Reasor says. “That’s affected us some. The technology side is a real problem right now.”
Despite being more than 15 years into the online shopping experience, with a regularly updated smartphone app, Reasor’s is having a hard time keeping pace with the big names. “What’s happening is the Targets and Walmarts and Krogers of the world have so many millions of dollars that they can devote to technology and the information behind all of it,” Reasor says. “That’s where it’s really tough for us. They’re starting to get ahead of us and we don’t have the money to fight it.”
So the company has started searching for tech companies ilike itself — smaller, innovative firms with the wherewithal to change
“We’re looking for software options that we can dial down and are scalable, where we can take the information and continue to compete. Right now I don’t know that we’re winning that battle. Before, I think, we were ahead of the curve. Innovation will take time. We’ll look for the tech companies who might be out there saying ‘You know, Kroger and Walmart wouldn’t talk to me, but this guy down here with a few stores, he could use the same thing.’”
Nature of the game
All of this leads to a world where a retailer can never be content. Reasor’s has begun the next phase of renovation — not so much rebranding, but re-tweaking, if you will.
The company has identified eight pillars — the tables program, meat, perishables, deli and more — and has hired people with Williams-Sonoma to help them further nail down the look and feel of their stores. Early this summer they expect to get the results of a recent focus group they conducted, which will tell them a lot about what comes next.
“The crazy thing is, in two weeks, we may go in another direction, but that’s the nature of the game,” Reasor says. “We’re starting to have some success in changing who and what we are.”
When it comes down to it, Reasor says, the company is trying to look for and serve the customer who lives to eat and wants to try new things. The customer that loves to cook and is going to buy the jackfruit or lemongrass and experiment. “We think we have got to be a little more relevant with that group,” he says. “We have everything under the sun, but what we’re trying to do is dial in our advertising and our promotion to back that up.
“It’s been a little more meat and potatoes with us over the years. That’s great, and we still value that, but we have to change.”