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John Thomson  

Rumours and things

There have been some changes in real estate holdings in West Kelowna as well as the announcement of the new project in the Miracle Mile of Shopping on Hwy 97 S. First of all, the Artis REIT group out of Winnipeg have purchased the Zellers building in West Kelowna and a minority interest in the Hub North Centre.

These are also the group that will develop the new shopping centre announced by WFN Chief Robert Louie a couple of weeks ago. That is the location where it was announced months ago that Landmark Cinemas are going to build their state-of-the-art six-screen movie theatre which would be the first anchor of the new site.

There is another site up the road that should be starting construction anytime soon, Governors Landing. The anchors at that centre at the moment are Winners and Future Shop. There are also rumours of a food store from the Sobeys group.
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How do Canadians decide where to grocery shop? According to a new study by The Nielsen Company, product assortment, shopping ease and good value for the money top the list of attributes that matter most to Canadians deciding where to shop, while low prices and loyalty programs are much less important.

Nielsen’s research also shows that promotions are a big influence when Canadians decide which grocery retailer to visit, and depending on the region, between 20 – 30 percent of consumers will switch stores based on the best promotions offered, up from 2009.

More and more, retailers are looking at downsizing their assortments, yet consumer’s rate product assortment and the ability to find everything they need in one store as one of the most important attributes when deciding where to shop, said Imran Hirani, vice president, The Nielsen Company. “Knowing what matters most to increasingly selective shoppers is crucial for grocery retailers.”

Nielsen’s ShopperTrends report studies what drives consumers’ grocery store choice across 23 attributes and correlates them to retailer brand equity, or why consumers choose the stores they do. In 2010, Nielsen surveyed more than 5,000 supermarket/hypermarket shoppers, aged 18 – 65, across all regions of Canada.

Canadians across all regions tell Nielsen they shop several stores on average shoppers visited more than 4.5 stores shopped during the past four weeks. In every region, less than 10 percent of consumers say they have shopped at just one store in the last four weeks.

Nielsen’s research shows that value is more important than price, with “good value” ranked higher and more closely tied with store equity than “low prices for most items.” In Quebec and West regions, “good value” placed in the top five attributes.

“Of course in this economy, low prices matter,” said Imran Hirani, vice president, The Nielsen Company. “What our research shows is that low prices are unimportant as a differentiator. In today’s environment, many consumers expect retailers to offer low prices to win their business. More importantly though, is the purchase a good value? That’s what consumers are asking.”

Loyalty programs consistently placed in the bottom five attributes across all regions. Nielsen’s research also indicates that in more than half of the cases examined, loyalty card use was much more common among consumers who were less frequent shoppers of the store than it was among frequent shoppers.
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It’s a rumour that has hit the front page and the retail industry is talking about as Target (Tar-Jay) Stores from Minneapolis has reported it is seriously looking at what kind of commercial space is available for them to open stores in Canada. There is nothing official from Target headquarters and the real estate people in Toronto have said it is not interested in any current locations of Zellers, owned by the Hudson Bay Co.

I must have written seven stories about Target and their interest in Canada
and I have never heard them say specifically that was true and of all the places they could expand this country would be first. As matter of fact they say nothing at all except “not at this time.”

Their success in the U.S. has been quite spectacular when you think about the market they are in and where the competition is coming from. The company made a statement in January that there expansion outside of the U.S. wouldn’t be until 2013. The big boxes Target builds are about 128,000 sq ft although it does have stores that are called Super Target and they are about 175,000 sq ft. Target is the second largest discount retailer in the United States, behind Walmart.

The story goes that Target looking at the success of other U.S. retailers who have come to Canada and been very successful that there is a good retail pattern there and expansion in the U.S. is not in the cards at the moment. Retailers like TJX Cos and their 290 Winners stores, NRDC who owns The Bay, Zellers, Homes Outfitters and Fields. Home Depot, now Lowes and many smaller retailers who have made a success of their move into Canadian retail.

It has been said that the Minneapolis retailer has put a team together to check out the Canadian marketplace, Toronto being first on the agenda.

There is a bit of blip in the market because the I.N.C. Group which operates chains like Ailes de la Mode and International Clothiers owns the rights to the Target name and has stores in Ontario under that banner.


More John Thomson articles

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About the Author

John Thomson is the Okanagan's pre-eminent business columnist writing his column, Rumours and Things, for over 24 years. Plugged in to the valley's who's who, John keeps his readers coming back for more with his straight talk and optimistic perspective on where we are headed next.

When John is not writing his column, he runs a sixteen year old think tank called the Executive Roundtable and holds his popular "Thomson Presents" quarterly business speaker seminars.

Have a comment, question, or tip for John? 

E-mail John at
[email protected]
or send him a fax at 250-764-8255.

 



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The views expressed are strictly those of the author and not necessarily those of Castanet. Castanet does not warrant the contents.

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