There's nothing flaky about Gregg's success!

It seems as though every week a new shop or restaurant chain is in trouble. There’s no doubt that some of the issues facing retailers and eateries are related to overheads – high rents certainly can’t be helping! However, there is also the question of customer appeal. If these retailers and eateries were truly delivering a desirable experience then surely that would encourage people to move away from internet purchasing and eating at home and back into their stores and restaurants?

That got us thinking…who are the success stories out there and what are they getting right?

One of the most successful high street food offerings at the moment is Greggs. We love a bit of pastry at Directions HQ, so we decided to investigate the success of Greggs further, purely for scientific interest of course! Back in 2012 Greggs was struggling. The rise of the coffee shop had impacted Greggs’ sales and times were tough. Pre-tax profits had fallen by 2.2% to £59.1m and stores were closing. Fast forward to now and it’s a very different picture! Greggs’ pre-tax profits were £81.8 million in 2017, up £80.3m vs. the previous year.

So, how did Greggs turn things around?

Greggs has focussed on its customers, delivering both the product they want and the experience they desire. Greggs recognised that 80% of its customers were purchasing food-to-go rather than traditional bakery items, such as bread. As such, it shifted its proposition from competing with bakeries to competing with McDonalds, Starbucks, Subway and the like.

Product wise, Greggs has continued to deliver the good value staples and classic products lines that they are known for. However, it has also not ignored the need to deliver against the ever growing ‘healthy’ food trend. Greggs has expanded its range to sell wraps, salads, soup, fruit and porridge. This Balanced Choice range, launched in 2014, already accounts for 10% of total sales.

Learning from coffee shops, Greggs has also invested in modernising its stores, to provide an enhanced retail experience for its customers. Pop into Greggs today and you are likely to find a nice seating area to relax and enjoy your food. You can even buy your Fairtrade coffee at the same time, so no need to visit the competition. To REALLY push the needle on providing a great in-store experience, five Greggs branches even provided a special Valentine’s dinner this year. Four courses of bakery loveliness, complete with prosecco and waiter service, all for just £15 for 2 people. What’s not to love?

Looking forward, Greggs is not resting on its laurels and is continuing to search for new ways to reach its customers. This has included extended opening hours to take advantage of the ‘breakfast on the go’ trend. In some parts of Newcastle, London and Manchester you can now get Greggs delivered to your home/office, and there is even a Greggs Drive Thru in Salford. In addition, Greggs has used its loyalty card scheme to unlock further customer insights and provide additional revenue.

So what can retailers learn from Greggs?

It’s simple…know your customer and deliver what they want in terms of both product and experience, even if that means adapting your proposition or changing your competitive set to better meet their needs.

Are you inspired by Greggs too? We’d love to hear your thoughts…