Meijer is making some statements these days about its jealous guarding of an expanding position as the Midwest’s home-grown superstore brand. It is rolling out home delivery across its six-state region, and it is investing more than $375 million in new and remodeled stores across that footprint — including Meijer’s first-ever outlets in Michigan’s remote Upper Peninsula.
After encouraging early results from its experiment with home delivery with 25 stores in the Detroit area, Meijer decided to bring 24×7, one-hour home delivery to its major markets of Grand Rapids, Mich.; Indianapolis; and Fort Wayne, Ind.; with plans to roll out the service to its other big markets in coming months. The chain also continues expansion of its Curbside at-the-store pickup service.
That means Meijer pretty arguably has gone to the head of the pack, at least in Flyover Country, in taking home delivery to its broad customer base. Working with Shipt, the delivery outfit in its Detroit test, and an app and web site, Meijer will make 55,000 grocery and other items available for a monthly fee or $99 for a yearly subscription, which includes free delivery for each purchase over $35.
“We think we’re taking the lead in the Midwest,” Meijer President Rick Keyes told me. “You can see tests across the U.S. Walmart is doing some testing. Whole Foods has a relationship with Instacart … Kroger is testing curbside in the Midwest and expanding rapidly.
Added Keyes: “This is something everyone is trying to figure out.”
One thing Meijer has figured out is that it’s going to take an aggressive tack even as the American retail landscape becomes a maelstrom. Proud department-store brands such as Macy’s are fading fast; the once-high-flying mid-price chain, Kohl’s, also is taking it on the chin; and even fellow mass discounter and sort-of-superstore operator Target has lost its mojo.
“As a family-run company focused on the customer,” Keyes said, “we take a very long-term approach and make the investments we need to over time. And we’re in the middle of making huge investments. We spent almost $1 billion in capital last year, and we’re in the process of finishing more than 50 store remodelings over two years.
“We feel like we’re positioned to win. We’ve seen cycles like this before in our 82-year history.”
So, despite its industry being redefined on the fly, Meijer just announced the new investments included in Keyes’ two-year total: seven new Meijer supercenters in Michigan, Indiana and Wisconsin, and 22 remodel projects this year. The chain operates more than 230 supercenters and grocery stores in those three states plus Ohio, Illinois and Kentucky. It pioneered the “one-stop shopping” concept.
But don’t expect Meijer to go wild in its efforts to keep up not only with Walmart but also with digital competitors such as Amazon. “We’re not doing any experimentation,” Keyes said, “with drone delivery.”