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Checkers: A Lesson in Customer-Centric Brand-Building

26 Feb 2024 | Customer-Centric Branding

Checkers, one of the most well-known grocery stores in South Africa, has undergone a notable transformation over the years, evolving from a conventional supermarket to a market leader known for innovation, customer-centric brand-building, and a commitment to quality.

Intending to target the mid-to-upper segment of the customer market while retaining its value-for-money heritage, Checkers has carefully balanced these seemingly opposing forces to position itself as a quality brand for the everyman to “democratise a better lifestyle, convenience food and healthier options by making premium fresh food more accessible to more people.”

We delve into the key initiatives that Checkers has implemented to improve its market position and become loved by a wide range of consumers in South Africa.

 

Background

Checkers, owned by Shoprite Holdings, was founded in 1956 and initially operated as a traditional supermarket chain. Over the years, it faced challenges from competitors and changing consumer preferences. However, Checkers seized the opportunity to reinvent itself and adapt to the evolving market dynamics.

Strategic Initiatives

 

Private Label Expansion

Checkers strategically expanded its private label offerings, introducing high-quality and competitively priced products while maintaining their well-known house brand. In 2020, they introduced their premium range, Forage and Feast, the country’s only private label product range endorsed by a Michelin star chef – Jan Hendrik van der Westhuizen. The brand won the coveted NielsenIQ BASES Breakthrough Innovation Award in the food category for 2023. It also recently won its court case with rival Pick n Pay over their lookalike private-label ranges, highlighting that the brand has developed into something “distinguishable and reputable” with high value that others wish to emulate.

The brand has also branched into other customer sectors with its Simple Truth wellness products, Banting Revolution, providing carb-free solutions, and its baby range, Lovies, which offers affordable nappies and baby-care items.

 

Tech Integration – Checkers Sixty60

Embracing technological advancements and evolving customer needs, Checkers invested in the Checkers Sixty60 app for online shopping. Launched mere months before the country was in lockdown due to the pandemic, the innovative app allowed customers to order groceries online and deliver them within 60 minutes. Further, their service guarantee states: “If we are more than 30 minutes late, or if you receive less than 80% of your first-choice products, we’ll give you back your R35 delivery fee.”

The convenience of this service appealed to a growing segment of customers, and the app’s seamless interface contributed significantly to customer retention and satisfaction.

 

Store Layout and Design

Checkers reimagined its store layouts, incorporating modern design elements to enhance the shopping experience. These strategies included creating appealing product displays, improving aisle navigation, and incorporating eco-friendly practices to address growing sustainability concerns. Their updated store designs have won them many awards, and they were crowned the overall winner of the 2022 Retail Design & Development Awards.

Store design and layout are some of the most potent aspects of how customers experience a brand, and this is particularly true for grocery stores that stock innumerable products and brands. By prioritising store layout and the overall look and feel, Checkers creates a customer experience that lessens customers’ stress in an overwhelming setting.

 

Customer Loyalty Programs

The immense growth of the Xtra Savings reward programme over the last few years has significantly contributed to Checkers’ customer loyalty and satisfaction. In a sea of loyalty programmes offering complicated point systems, tiers and levels, the Xtra Savings programme is designed with simplicity and transparency, offering instant cash savings on specific items.

Checkers has claimed, “More than 25 million South African consumers saved a combined R7 billion on their grocery bills during the past six months (July to December 2022) through the Xtra Savings programme at Shoprite and Checkers supermarkets.” These numbers have proven their promise of value for money to customers on all sides of the spectrum.

Results

Market Share and Profit Growth: Checkers witnessed a steady increase in its market share, outpacing competitors and solidifying its position as a market leader. Shorpite posted 52 months of uninterrupted market share gains (reported in September 2023), and in its annual results for the year ended 2 July 2023, they revealed that sales were up by 17% or R26 billion on the previous year to R215 billion.

 

Customer Satisfaction: The increase in market share mirrors the various brand and trust awards that Checkers has obtained in recent years, from the Most Admired Brand in South Africa (by MarkLives in 2020) to SA’s Most Reputable Supermarket (by Brand Finance in its 2021 annual report). While social media reveals customer complaints and negative reviews, there are extensive posts on how customer service has reached out and tried to rectify any issues. No brand is perfect, but saying sorry when you make a mistake can speak volumes.

 

Checkers’ journey to market leadership in the South African grocery industry is inseparable from the success of its product expansion and Sixty60 app. This innovative approach, commitment to quality, customer-centric strategies, and a focus on technological integration have secured Checkers’ position in the market and set a new standard for excellence in the grocery retail landscape.

 

Key-Takeaways

  • Balancing opposing value positioning within your brand is possible if your product and pricing strategy are aligned correctly. Checkers did this by ensuring it had the range to cater to customers with varying budgets.
  • Every challenge presents an opportunity. Checkers used the significant challenges of COVID-19 and intense competition as an opportunity to reinvent itself.
  • Try to meet your customers halfway by making the buying decision as easy as possible. Sixtysixty gave previous customers an easy reason to try Checkers again.
  • Successfully positioning your brand takes complete alignment across the entire business. Checkers are successful because they align all business areas, including product development, pricing, and customer experience, with their desired positioning.