BEVERLY HILLS, CA - Rumors and confirmations of industry partnerships have been popping up left and right, it seems. One such report that was circulating posited that Kroger and Target were in the thick of merger talks—a story that was then denied.
Scarlet Fu with Bloomberg sat down with Kroger’s Chairman and CEO Rodney McMullen, who spoke to these rumors and more industry shifts during a time of constant evolution.
“Change is just part of who we are. The only thing that stays consistent is that people keep eating, but the way they eat will constantly change. So, people today are much more interested in being inspired by food and food that’s healthy for them but based on their terms," McMullen explained.
Fu asked him, then, about what makes Kroger different than its competition, Walmart, in the wake of the Walmart-Asda-Sainsbury’s hand-off that took place earlier this week. And what sets the retailer apart from others aligning themselves in the current industry landscape?
“For us, over nine million people a day come into our stores, so we are really focused on those nine million customers. And clearly they want more natural organics, so that’s a product that’s been growing for us for several years. If you look at our own brand of Simple Truth, five years ago we introduced it, and it’s over a two-billion-dollar category today," McMullen shared.
The executive side-stepped the question about a possible merger with Target by providing insight into what it would be looking for if it were to merge with any company at all.
“For us, on any type of merger that we look at doing, we’re completely focused on how . . . the two companies together create capabilities that neither one of us would have independent of each other. To me, we’re big enough at 120 plus billion that scale really isn’t what we need for merging with somebody," McMullen said.
The question, though, is whether or not companies are in need of building out in order to combat heavy-hitters Amazon and Walmart, as Fu inquired. Is it worth it to create your own delivery services or should companies continue to hire outside and enlist services catering to consumers’ needs?
“Everything that we find, the customer wants to do it on their terms, not our terms,” he shared, before responding to the question of whether it is better to own those terms or outsource to other companies. “For us, we decided when we do it ourselves and when do we have a third party do it. We keep the relationship with the customer, and that’s really the key . . . maintaining that relationship with the customer.”
To check out the whole interview, watch the video above.
With its eye on customer experience, the retail chain continues to engage in the conversations being had on how to get the best results. Will Kroger find a potential match worth vying for or will it carve its own path in this ever-changing industry climate? AndNowUKnow will keep you updated with the latest.
