EL SEGUNDO, Calif. -- Tesco PLC received a strong positive reaction to its U.S. Fresh & Easy Neighborhood Market Inc. convenience/grocery chain, The Financial Times reported, citing independent research compiled following interviews with almost 700 customers outside nine Fresh & Easy stores in Los Angeles, Las Vegas and Phoenix. And Neilsen has reported positive "buzz" about the chain. The information follows speculation that Tesco's attempt to break into the U.S. grocery market was failing to hit the mark with local shoppers.
As reported earlier this year in CSP Daily News, Piper [image-nocss] Jaffray and others including "The Perishable Pundit," a grocery-industry blogger, said the new El Segundo, Calif.-based chain was already in trouble and needed to prove the viability its concept (Click here to read the coverage.)
The retailer added fuel to the criticism when it announced that there would be a three-month "time out" in its rollout of Fresh & Easy stores. (Click here to read the coverage.)
Tesco's CEO Sir Terry Leahy responded to critics and defended Fresh & Easy, claiming that the fledgling chain will "last a generation." He said that customers "love" the American chain. (Click here to view the coverage.)
"Fresh & Easy is the new cult retailer," Execution Research said, according to a report by The Evening Standard. "At the risk of doing the job of Tesco's public relations department, F&E is already an incredible success story."
The research firm said that shoppers rated the chain ahead of both Trader Joe's and Whole Foods in terms of freshness and even beat Wal-Mart for value for money. It said that it expected Fresh & Easy shopper numbers to grow from the current 20 to 30 per hour as brand awareness increased.
Also, Neilsen Online recently reported that with more than more than 60 Tesco's Fresh & Easy stores now open, consumers are talking online about the chain. "Buzz levels" for Fresh & Easy peaked in November 2008, up 96% from the preceding months, Neilsen's Buzzmetrics service said, when the store opened more than 10 locations across California and Nevada. Several more stores opened in December, all garnering healthy buzz activity.
Conversation drivers included competitors, shopped items and discussion around price, product freshness and convenience. Neilsen also said that Fresh & Easy led in buzz compared to Whole Foods and Trader Joe's, with buzz volume 60% and 52% higher, respectively.
Some 59% of sentiment toward Fresh & Easy was positive with consumers citing competitive pricing and convenience as purchase drivers. Consumers generally view Fresh & Easy as a supplement rather than a replacement for their current grocers, said Neilsen, and express a willingness to add Fresh & Easy to their shopping rotation to stock up on meat, inexpensive organics and other convenience-oriented products that my otherwise prove cost prohibitive in the current economic climate.
Some 30% expressed negative or mixed sentiment toward Fresh & Easy. These consumers typically compared Fresh & Easy to the product assortment and prices of Trader Joe's, Whole Foods and Wal-Mart.
Shopped items, in particular, gave consumers something to talk about, including meat (27%), prepared foods (17%) and dairy (16%) and fruits and vegetables (16%). Consumers were enticed by affordable specialty items like hormone-free meat, cage-free eggs, preservative-free bread and fresh-squeezed juice as well as inexpensive organics. Many shoppers, mainly commuters and young professionals, enjoyed the benefits of ready-to-eat and ready-to-cook meals.
This week, Fresh & Easy revealed a new selection of 250 additional branded foods. The new products include fresh prepared ready meals, new juices and brewed teas, soy and goat yogurt and a range of ready-to-grill meats.
The mixed grill pack, which retails for $9.99, contains four sausages, four beef patties, four chicken thighs and four chicken drumsticks.
Fresh & Easy said it has rolled out other improvements. Since opening in November, Fresh & Easy has been asking for feedback through the company's website, focus groups, comment cards and customer surveys on how to make the shopping trip even better. Among the first responses to feedback was in March when the company began accepting American Express cards.
The company said that many customers have emphasized how easy it is to get around the stores. Feedback also shows shoppers like the new brighter colors inside stores as well as the signs guiding customers to particular product areas, displaying Fresh & Easy's brand messages.
These designs will be incorporated in all stores by July 2, when Fresh & Easy opens its Manhattan Beach, Calif., it said.
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