Committed to ‘Foodies’

With a motto that says “supporting food and family,” it’s no surprise that Longo Brothers Fruit Markets Inc., Vaughan, Ontario, puts an emphasis on family in its business operations. In fact, family is one of the retailer’s greatest strengths, notes Jenny Longo, the retailer’s director of private brands. Not only has the retailer been family-owned and -operated since its first store opened in 1956, but it also isn’t unusual to find multiple generations or multiple members of the same family working for the company.

It’s also not unusual to find team members who have been working for Longo’s for decades. Longo points to Robert Koss, the retailer’s vice president of marketing, who started working for the retailer at 23 years old in one of the local stores as a part-time employee. He has now been with the company for 27 years.

“We have a lot of individuals here with that same background: They start out a part-timer, and they’re still here 20 or 30 years later,” Longo adds.

She credits a lot of that longevity to the company’s willingness to constantly adapt to the times. Where some companies might be afraid of change, Longo’s — and its employees — thrive on it.

Emphasis on fresh, local

As a smaller regional chain — with 26 stores — Longo’s also embraces anything else that will help it stand out from the competition.

“We’re a regional player in a land of giants,” Koss says. “But our consumers don’t know or see that. They just see us as another option. So we have to work hard to compete and draw the consumer to our stores.”

One way the retailer differentiates itself is with an emphasis on “fresh” and the perimeter of the store.

“We started with fresh and we continue to be focused on fresh,” Koss says.

Longo’s stores have a much larger perimeter dedicated to fresh foods than that of other Canadian retailers, Longo says. And shoppers will find many private brands in the fresh department.

“Half my store brand portfolio is made up in the fresh department, which is really unique,” she adds.

And that focus on fresh seems to be resonating with consumers.

“Longo’s has a great reputation for fresh-prepared foods, and they’re doing a great job delivering on their ‘fresh traditions’ promise,” says Scott Lindsay, president, Product Development Plus, Toronto. “They have created a ‘treasure hunt’ shopping experience by focusing their in-store presentation on their fresh foods. Plus, the minimal packaging and basic labeling Longo’s currently uses on its fresh ready meals, salads, etc., ensures the prepared food recipes are the hero. This results in positive equity transferred directly to Longo’s, which is where you want it.”

Another way the retailer differentiates itself from the competition is with its emphasis on local products.

“We are a local organization, and we always put local first,” Koss says.

During the growing season, 70 percent of Longo’s produce is local. And when it comes to private label center store products, Longo’s is always looking to work with local suppliers and manufacturers. Not only does it help reduce the product’s carbon footprint, but it also is better for the community by supporting jobs in the nearby areas, he says.

And the retailer has taken local to the next level by incorporating it into its meat and dairy departments as well. For example, in June of 2014, the retailer announced that it was partnering with Simcoe, Ontario-based VG Farms to provide its customers with fresh local beef. Each package of beef contains a QR code that allows shoppers to view the farm in Ontario from which the cattle originated, its age and its diet. Prior to its partnership with VG Farms, Longo’s already offered customers options for locally raised chicken, turkey, pork, lamb and veal.

“Our shoppers love that we place an emphasis on local,” Koss says.

No ‘knockoffs’ here

Of course, the retailer’s store brand program is another way it separates itself from the competition.

“One of the things we’re known for is being innovative and on the leading edge,” Longo says. “Our size makes us agile enough to try different things.”

Longo’s isn’t out to “knock off” national brands with its private label program, she adds. The retailer is actually very loyal to its national brands.

“Our growth stemmed from the support of national brands that helped us when we were small,” Longo says. “So we’re not looking to replace national brands in our stores, and we don’t have a goal of 100 percent private label penetration.”

Instead, Longo views private label as a way to build customer loyalty and deliver something unique — and of high quality — to its shoppers.

“If we wouldn’t serve it to our family, we wouldn’t serve it to our customers,” Longo said.

To create products that resonate with its shoppers, the retailer realized early on that it had to know its customer base. So Longo’s uses a consumer insights team to research and study the consumers who are shopping its stores. Based on that research, the retailer knows that its shoppers tend to skew a little older than its competitors’, for example, and have slightly higher incomes and education levels, Koss says.

Longo’s customers also tend to have a greater degree of “food involvement.” They tend to have traveled more than the average consumer and are well aware of what’s out there when it comes to great food products.

“Our shoppers are not looking for value items or belly fillers,” Longo says. “They are ‘foodies.’ So we know we have to develop authentic products because more than likely, our customers have already eaten the real thing.”

To appeal to their customer base, therefore, Longo’s shifted from a one-tier private label program to a two-tier one about three years ago. The national-brand-equivalent tier features a white label with the Longo’s logo at the top above clear, concise labeling and clean, simple graphics. The packaging is meant to highlight the equity of the Longo’s name and connote the quality and value of great everyday products, Koss says.

Meanwhile, the niche premium tier Longo’s offers is called Longo’s Signature. Its logo uses a combination of an all-capital block-type font and a handwritten script font and is reminiscent of a circular stamp. The logo for this tier uses elements of the Longo’s logo, but in a more stylized version to help consumers identify that the product is something “special” or “exclusive” such as a proprietary blend or recipe that no other retailer offers, Koss adds.

“It’s rare to see a private label program where the name on the products matches the name above the door, but ours does,” Longo says. “Our customers trust our name.”

Besides the products found in the center store, Longo’s prides itself on its store brand meal kits found in “the kitchen” — they carry the slogan “Fresh meals, made easy.” The meal kits are freshly prepared each day and are made without preservatives. They allow customers to prepare a meal in less than 10 minutes using only one pan. The meals are so popular among shoppers that the Longo’s Signature Chicken Pad Thai variety was honored with a 2014 Product of the Year Canada award.

“This was the first time we entered the contest, and we won,” Longo said. “What was especially nice about this award was that the program encompasses all of Canada, and Canadian consumers are the ones who choose the winners. Since we’re only in Toronto, not as many Canadians are familiar with us or our products. So it was really nice to have this recognition.”

A store brand advocate

And Longo’s isn’t shy when it comes to promoting store brand products. It uses every means possible to get its 741 store brand products in front of customers’ eyes, Longo says. For example, Longo’s uses category “bumpos” where the store will actually bump out a section of the physical shelf and display the store brand product so that it stands out more prominently.

In key categories such as olive oil, the stores make good use of standalone displays where customers can shop around or walk around the display and see the private label featured, Longo says. And besides the typical print flyer, Longo’s uses its free Experience magazine, published quarterly, to feature store brand products. The retailer also produces a calendar and uses its loyalty program to feature private label products.

Plus, Longo’s takes great care to feature store brand products each week during in-store taste tests and demonstrations, with every Thursday and Friday dedicated to only private label products. Every store has a team of demonstrators that work just for Longo’s. Every month, Longo or a member of her team visits the stores and educates the team of store demonstrators about the store brand products they will be featuring in the near future, she says.

“They’re our frontline soldiers telling our story and telling consumers what to buy” she adds. “Its amazing because customers line up to talk to these demonstrators and seek them out to ask what’s new and what’s coming up so they can plan their shopping schedule around the demonstrations. Even though private brand demonstrations aren’t funded, we make it a priority to invest in these trials because it’s so beneficial to us.”

Besides the in-store demonstrators, Longo’s relies on its store team members to communicate the benefits of private label to the shoppers, Koss says.

“We don’t have to challenge our staff to promote or merchandise private brands,” he adds. “We have a great engaged team member base, so they do that on their own.” Longo’s is also testing a new way of promoting and merchandising store brand products. In one of its stores, it created the “Longo’s Family Pantry,” where only Longo’s branded products are featured. The pantry will typically include both Longo’s Signature and Longo’s Value tier products.

Relationships matter

As a regional retailer focused on creating unique store brand products for its customers, Longo’s is very selective about the suppliers and manufacturers with which it works. The retailer doesn’t want to be just another contract; instead, it wants to create relationships that will blossom during the years the companies work together. Therefore, it looks to partner with family-owned and -operated companies that have values similar to Longo’s. Currently the retailer works with 91 manufacturers, Longo says.

Once it enters a partnership with a supplier, Longo’s willingly devotes 100 percent of its energy to working with that manufacturer in the research and development of store brand products, Longo says. But it’s not just the private label department at Longo’s that works with manufacturers to create store brand products.

“I don’t think people really realize how involved our organization is in the development of private label products,” Koss says. “From our president and CEO to individual team members working in our stores, everyone has the chance to make suggestions and give feedback.”

During store visits, Longo’s team members are encouraged to speak up and talk about what they saw or ate on recent vacations that was fun, unusual and delicious. And after the launch of a new store brand item, team members are encouraged to try it and report back to make sure the flavor, texture and other elements are on point now that it’s in production, Koss says.

“It’s a loop of feedback we love and encourage that comes from a genuine desire to sell a great product,” Koss says.

But even the best retailer-supplier relationships can have challenges. For example, quality assurance — ensuring that the product specifications that were agreed on when the retailer first contracted the manufacturer are still being followed two or four years later — is something Longo cites as a challenge.

“If we’re not getting the quality of product we were promised and we insist on getting, we’re not afraid to move the business and switch vendors,” Longo says. “That’s why it is so important to have a really good relationship with the vendors because if an issue does come up, they’re going to treat it with the same importance as if it was their name on the label.”

Looking to the future

As Longo’s looks to the future, it has some specific goals it hopes to accomplish. For example, while the retailer has great speed to market with store brand products, it wants to work on streamlining the process of innovating and launching new products so that it is even faster, Koss says. Of course, increasing private label penetration is important to Longo’s as well.

“We have a great customer base that trusts our brand, and we want to leverage that,” he adds.

And as a retailer that focuses on fresh, Longo’s hopes to further increase its understanding of the role private brand plays in its fresh departments.

“Our consumers often perceive the whole fresh department as private label, and we want to learn how to leverage that perception and bring that to the center store as well,” Koss says.