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Loblaw is expanding its food waste programme with Flashfood to additional stores across Canada.

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Canada’s leading food retailer, Loblaw, has launched several new plant-based products as part of its President’s Choice private label range.

Strong on-shelf identity

The new range covers several different product categories including frozen desserts and meat-less burgers. Using a green design concept, which incorporates a new ‘Plant-Based’ leaf logo, the products can be easily identified on-shelf. The products sit within its President’s Choice range, which is Canada’s largest food brand. The launch reflects Loblaw’s innovative approach to private label development and forms part of its broader PC Insiders Collection summer campaign.

Source: IGD Research

Growing consumer demand

Plant-based products have been gaining significant traction with both consumers. In North America, BeyondMeat has emerged as one of the fastest growing companies in the segment. Several retailers have been running in-store campaigns to highlight the availability of the company’s products within their stores. BeyondMeat, along with one of its key competitors, Impossible Foods, have also signed several restaurant and food-to-go partnerships, including with leading burger chains A&W and Burger King, as demand for their products has grown.

Growing focus for food retailers

Retailers have been quick to respond to this. In addition to Loblaw, several other retailers have launched new ranges. UK-based Sainsbury’s added several products to its ‘Sainsbury’s Love Your Veg!’ private label range earlier this year. M&S has launched a 60-product range of plant-based meals, snacks and ingredients under the Plant Kitchen brand. This new range was developed to make plant-based food more exciting. Last year, Aldi in the US launched a new range of products under the Earth Grown brand. The meat-free range also includes several vegan products. Over the next 12 months, we expect this to be an area of growing focus for retailers as the trend becomes much more established.

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We look at how Loblaw is using gamification to drive home its low-price credentials within its No Frills discount business.

Supporting the brand’s new marketing campaign

No Frills has launched a new web-based game, Hauler: Aisles of Glory. The retro 8-bit 2D animation video game, which can be played in-browser on mobile, tablet and desktop, supports the brand’s new marketing campaign which launched earlier this month. The ‘Haulershop’ initiative includes a range of branded merchandise, a dedicated website, haulershop.com, and an edgy TV campaign. The use of the game and the 'hauler' brand helps to create new buzz and a sense of fun for No Frills and should support it with its goal to reach a younger audience. 

Source: Loblaw

Linking with its loyalty programme

Users of the game can claim up to 50 PC Optimum points daily by hauling groceries and avoiding unnecessary frills and obstacles not commonly found within grocery stores. The game will continue to reward points until 50m PC Optimum points have been rewards nationally. Linking to it the retailer’s loyalty programme helps to raise its profile, given that rewards-based initiatives are not typically found within discount stores. The points can be redeemed for additional in-store savings.

Source: YouTube

Intensifying discount competition

The launch of this campaign comes as competition in the discount channel is set to intensify. Last month, Sobeys launched the first of its FreshCo discount stores in western Canada. Over the next three to four years, it will convert up to 70 of its Safeway branded stores in the region to this format. Loblaw’s other price-focused format, Real Canadian Superstore, has also recently launched a new price led-campaign in the region. It emphasises key reasons to shop at its stores, including everyday low prices, 10 for $10 programmes, its private label ranges and its extensive ethic foods offer.

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We review Loblaw’s first quarter results and three of its major initiatives for the current financial year.

Food retail same-store sales up 2.0%

Loblaw’s first quarter revenue increased 3.1% to $10.7bn, with retail segment sales up 2.9% to $10.5bn. Food retail same-store sales increased 2.0%, with drug retail same-store sales up 2.2%. Operating income increased 19.9% to $451m. Within food retail, while store traffic was flat, basket size improved, with the company’s internal food inflation measure slightly lower than the official CPI of 3.3%.

Embedding data across the business

Loblaw continues to make progress with its process and efficiency initiatives. This is a major project for the company with around 400 initiatives being tracked across six different work-streams. The aim is to generate cost savings which enable further investment in technology and innovation. This includes the better use of data. It is being used extensively across the organisation to provide more relevant customer offers, improve promotional decision making and more effectively manage its supply chain. A new leader has been appointed for its data and analytics centre of excellence, with over 400 people working in related roles.

Source: Loblaw

Improving ecommerce efficiency and service

Investment continues in its ecommerce proposition, with a focus on improving service times. New technology has been introduced to help it better track the efficiency of its operation and its ability to meet a five-minute pickup time. With most stores offering two-hour pickup windows, it's testing its ability to offer customers a one-hour cut off. With its PC Express pickup service available at over 700 locations, the focus is on refining the offer before any further significant expansion.

Growing private label penetration

Loblaw is also developing new meal solutions. It has launched a range of ready to eat and ready to heat meals through its delivery and pickup services, while later this month it will be launching a range of meal kits in almost 100 stores in Ontario. This forms part of a renewed push on private label, an area where the business has consistently led in Canada. A new range of meals, under the Summer Shack brand, will launch in the coming weeks. The retailer plans to continue growing the penetration of its key ranges including President’s Choice, No Frills, Farmer’s Market and Life.

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