Store: S Market
It is fair to suggest that my second ever visit to Helsinki was a mixed affair. On the upside, spending time with my lovely colleagues at TNS was a joy. Spending time with some great folk at one of my favourite retailers was an equal pleasure, as was popping in to spin the yarn with various suppliers and media businesses. The grown-up food I had was a revelation (Copas Y Tapas is to be recommended if you fancy the somewhat quirky notion of Finnish tapas produced from the finest local ingredients), while the typical Roberts fare was supplied by McDonald’s, whose localised menu and fantastic service were splendid.
On the downside: the weather was unsurprisingly dreadful; several stores that I had planned to visit were closed down, closing down or closed for refurbishment; I failed to locate a branch of Hesburger; and the ticket I had for the football match between HJK and Mypaa was rendered somewhat redundant by the fact that they had moved the fixture to mid-October. Massive thanks (irony, here) to the local Ticketmaster for letting me know about that. Not only did this mean that I am stuck on 159 grounds, a total that will be notched up to 160 after Hendon’s FA Cup tie at Dorchester Town tomorrow, but it also no doubt means that the game at the Sonera Stadium on the 16th of October will be a 4-3 thriller with loads of controversy and the best burgers in the history of Western civilisation.
Anyway. I’ll document my visit to the awesome new K Supermarket near the railway station in a blog in the not too distant future, but this week is devoted to a trip to S Market, the main chain operated by S Group. Now the market leader, S Group is a colossal conglomerate with activities encompassing food and non-food retail, hotels, automotive distribution, financial services and restaurants.
In a narrative not a million miles away from the UK situation, where a price-led Tesco overtook Sainsbury’s, S Group claimed market leadership from Kesko a while back, with a strong value proposition and a multi-format store opening programme that has enabled it to address a wide variety of shopper missions across a disparate array of shopper types. It now has a market share of something in the region of 45%, ahead of Kesko’s 35% and miles ahead of Suomen Lähikauppa and Lidl with around 7% each.
It is probably around 10 to 12 years since I last visited Finland, and I recall on my last stay that there were the first rumblings of disruption from Lidl’s market entry. Lidl has now become a force to be reckoned with in the Finnish market. While it still has a fairy modest footprint, the repercussions of its discount ethos are substantial, with a very UK-like story of improved ranges, improved marketing and improved stores winning over shoppers left, right and centre.
S Group – whose food outlets include Prisma hypermarkets, S Market supermarkets, Alepa and Sale c-stores and an e-commerce business – stands out, because most of its operations are simple affairs. There is little in the way of shouty price messaging, elaborate shopper marketing or up-to-the-minute merchandising. While this basic approach makes for a lean, efficient operation, it also renders the instore experience devoid of warmth, aspiration or interactivity.
The store I visited – in the basement of a Sokos department store – is best described as utilitarian. The produce department is perfectly acceptable, with plenty of variety and great stock levels, but there is little endeavour to play up its attributes. Housed in industrial units, there was no spark of theatre or engagement, meaning that what should be a store’s greatest asset was somewhat neutralised. Once again, apologies for the lame photography this time around: a slightly moist smartphone rather than the trusty Box Brownie was in deployment again.
In other departments, the absence of huge levels of promotions implied to me that this was something of an EDLP operation. There seemed to be a focus on efficiency and cost-minimisation throughout, sometimes with unfortunate consequences. One example was the shelving system. Each SKU was demarcated by a plastic divider – presumably great for hastening replenishment and making sure each SKU is in the right spot. However, after about four units have been sold, this means that the available stock is rendered virtually invisible. As a consequence, I spotted many shoppers having to squat or nearly crawl to see if items were available. Great stuff for employees, but pretty poor for the shopper.
Another gripe was the total absence of category segmentation or on-shelf navigation. While overhead signage did a reasonable job of telling you which categories were where, once at the fixture I was confronted by ‘walls of stuff’. Categories like yoghurt and confectionery, where shoppers would clearly benefit from some hints about product format, usage or consumption occasion, were just, well, walls of stuff.
The range itself was pretty good. There was a decent mix of national brands and S Group’s private label portfolio, the X-tra economy brand standing out on shelf quite strongly. Customer service wasn’t great, in all honesty. The store was busy and there seemed to be too few staff on duty, resulting in hefty queues and housekeeping standards that left a little to be desired.
I really don’t like being mean about stores, but this was a very underwhelming experience. The overarching impression was that the store is operated as a distribution hub: a place where punters come to exchange money for products. Nothing wrong with that: that is what retail is there for. But the absence of charm, of engagement, of shopper advocacy, meant that I yearned for a supermarket where I felt like a valued customer rather than a valued transaction.
Store design: 6 (would have been lower, but they did well in an odd-shaped basement full of pillars)
Customer service: 5
Private label: 6
Total score: 27