Everybody wants awareness – who doesn’t? Retailers really want it. Collectively they spend tens of billions of dollars trying to build it. Advertising, retail media, sponsorships of all kinds, new store openings, digital marketing, loyalty programs. You name it, they’ve run it. And the thinking couldn’t be more straightforward: if more people know your brand, more people will shop your stores.
It’s tough to argue with that.
But a fascinating new study from brand research firm Conjointly suggests awareness is just the first step in building a truly great grocery brand. The goal is to get shoppers to know who you are, but the brass ring is getting them to choose you again and again.
In any case, the Conjointly data makes one thing abundantly clear: Absolutely no one comes close to Walmart on awareness
The Awareness Grand Champion
According to Conjointly’s latest three-wave tracking study of U.S. supermarket chains, Walmart leads the industry with 86% aided awareness, 69% consideration, 70% recent purchase, and 31% preferred brand status. It doesn’t take a marketing expert to conclude that that’s something like uncontested dominance across the entire consumer decision funnel.
The world’s second-largest retailer doesn’t stop there.
Walmart also tops the study in virtually every major brand perception category, earning 92% for trust, 91% for assortment, 90% for price value, 86% for convenience, 83% for availability, and 80% for fresh produce. The numbers suggest Walmart is indeed winning on price, but it’s also seen to be delivering consistently on its promise.
An open-and-shut case, it would seem. So what’s left to learn?
Quite a bit, actually.
As it turns out, buried beneath Walmart’s impressive marquee numbers is perhaps the most interesting statistic in the entire report…
The Dark Horse of Customer Loyalty
It belongs to H-E-B.
The Texas-based regional grocer, while it is one of America’s top 10 largest private companies, has awareness of only about 20% nationally. Of course that’s hardly surprising considering that its only American operations are in Texas. By comparison, Walmart sits at 86%, Target at 72%, ALDI at 70%, Costco at 67%, and Kroger at 58%. And yet… by the numbers, H-E-B converts 53% of shoppers who try it into devoted regulars. That’s extraordinary; it’s the highest trial-to-loyalty conversion rate of any chain in the study.
So we can conclude that Walmart has a massive reach, while H-E-B sparks intense loyalty. Those are very different kinds of brand strength.
Grocery execs often speak of market share, household penetration, and new customer acquisition – all important metrics, for sure. But H-E-B demonstrates there’s another way to build a great grocery business: become indispensable to the shoppers who already know you.
Money Can’t Buy Fanatical Preference
That’s a lesson every regional grocer should take to heart. Here in the Northeast and Mid-Atlantic, retailers like ShopRite, Wegmans, Market Basket, Weis, Giant, Food Bazaar, and others don’t need to beat Walmart at national awareness. They probably can’t, anyway.
What they can – and should – do is build the kind of customer relationship that turns familiarity into preference and preference into loyalty. In many ways, that’s a much more durable competitive advantage.
The report results are a powerful reminder that massive scale isn’t the only path to success. ALDI, for example, converts strong awareness into meaningful preference, while Costco continues to perform exceptionally well despite (or perhaps because of) operating a warehouse-club model that differs dramatically from the traditional supermarket. Even WinCo Foods, a West Coast chain with relatively modest awareness, posts one of the strongest awareness-to-preference conversion rates among the chains studied.
A Huge Opening for Regional Grocers Everywhere
What separates these retailers isn’t simply advertising. It’s clear that these operations are executing at a very high level. Consumers reward stores that consistently deliver on the promises they make, whether that’s on price, assortment, fresh produce, convenience, or even something like local relevance.
That’s why I think awareness can sometimes be thought of as an overrated metric. With enough money, enough marketing firepower, awareness can be purchased. On the other hand, preference has to be earned; it comes mainly from countless successful shopping trips.
Of course this is all taking place against a backdrop of ferocious competition. Consumers have more choices than ever before, and digital channels make discovering new retailers easier than at any point in history. In this kind of environment, merely being known is no longer enough. Being remembered is better… but being preferred is the gold standard.
In other words, the big competitive advantage isn’t necessarily having most shoppers know your brand, but having the highest percentage of shoppers who refuse to go anywhere else.