EXECUTIVE INSIGHTS | Staff Reporter, Australia
Christina Murrell

Surviving the next food retail tsunami


The economic tsunami that hit retailers with a mighty force was unavoidable. It caused the closure of thousands of stores from across the world - from well-known brands to unknown stores - the waves did not discriminate.

Let’s not dissect the cause. Too many theories, too many fingers pointing. Sharply, too!

But there is one thing for sure that has caused an increase in competition within the food retail space. Here in Australia, it has already begun.

Increased food retail competition

I love the food retail space. I really do. But why would any sane person want to go into the minefields?

• Low profit margins

• High capital investment

• High labour costs

• High rental costs

• High transient retail staff turnover

• The psychology of the Millennial workforce!

And if you have FOMO, add-on up to 35% commission fees for 3rd party food delivery services.

Answer: Because the other sectors look worse!

According to the Australian Bureau of Statistics:

• Clothing, Footwear & Personal Accessories sector fell by 0.39% YoY
• Department stores fell by 0.3% YoY
• But Cafes, Restaurants & Takeaway food services grew by 3.85% YoY

Not a surprise to hear that department store David Jones announced it would open a new food concept focusing purely on food retailing in early 2019. But the pressure is causing our hero food stores to fall like foot soldiers in the great wars. Even Retail Food Group, owners of Brumbies, Donut King, Gloria Jeans, Crust & Michel’s Patisseries, announced it will close up to 200 stores.

Shopping centres are being accused of replacing poor-performing non-food stores with food stores. Contributing to increased food retail competition there.

Awake to the ‘Customer Experience Economy’

But wait, there’s more. Don't forget we are in the ‘Experience Economy’ a term used by B. Joseph Pine II & James H. Gilmore as far back as 1998. I’ve said it before; customer experience IS the currency to customer loyalty. This is Customer Retention. Retailers must look at the whole Customer Experience. Constantly creating value as the customer weaves in & out of their physical & digital world.

Create value along with what I call the 3 Pillar's of Customer Experience: Customer Buying Experience, Customer Food Experience, and Customer Care Experience. Plus, the X-Factor. Consulting firm McKinsey calls it ‘Signature Moments’, I call it Remarkable Moments.

Remarkable Moments consist of the unexpected, the warm breeze of positive emotions, and the creation of a good memory. Create enough of these good memories consistently and you’ve just found yourself the Fountain of Future Profits.

Rise above the tsunami

You can’t stop the tsunami, but you can ride it and even thrive. These are in your control:

1. Don’t force your baby to run

The investment for each new store is enormous. It is exhausting right up to open day. But you must not stop there. Don’t leave the new store on its own just yet. In most cases, sales will go down around the 3-6months mark. Have:

• New Store Launch Marketing Plans
• 0-6 Months Promotional Plans
• 6-12 Months Promotional Plans

2. Plan the moments

Design the Customer Experience. Don’t leave it to chance. Don’t leave it to the spontaneity of your retail staff. Consider those as bonus experiences.

• Map your customer journey
• Identify each digital & physical interaction
• Identify interactions that can be turned into a Remarkable Moment
• Standardise these Remarkable Moment
• Check off the Customer Buying Experience, Customer Food Experience & Customer Care Experience

3. View the customer for life

Move your team towards seeing each customer as a customer for life. Not just for that single transaction. Sure, you won’t get every customer. But think about this: a research done by Frederick Reichheld of Bain & Company revealed that an increase in customer retention by 5% will increase your profits by 25% to 95%. You’ll be amazed of the impact simply by reframing an outlook.

4. Get technical

I don’t mean knee-jerk reaction and do what everyone else is doing like building an app. I mean use technology to be data smart. We are behind. Leading US food retailers are already financially benefiting. They focus on:

• Using technology to enhance the integrated omni channel Customer Experience. Which will enable…
• Using data analytics to predict customer behaviour to generate revenue from existing customers

So, focus on what you can, but not on everything. Just what will give you the greatest returns at the lowest cost - which in my view is Customer Retention. 

Contact Christina at Connect with Christina on LinkedIn at

The views expressed in this column are the author's own and do not necessarily reflect this publication's view, and this article is not edited by QSR Media. The author was not remunerated for this article.

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Christina Murrell

Christina Murrell

Previously the marketing director of Vietnamese chain Roll'd and cult burger brand Royal Stacks, a cult burger brand, Christina now helps food retailers, cafes and restaurants, to keep customers. She advocates for optimising existing customers to generate future profits. She is the Customer Retention Chief at Loyalty Tribe Marketing, a boutique-marketing agency that specialise in the food retail sector.

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