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Shaws Digital Transformation Strategy
Key Takeaways
- Shaws is a chain of supermarkets located in the New England region in the U.S.
- Shaw's competitors include Walmart, Market Basket, Hannaford, and Stop and Shop.
- Shaw's major challenges are low patronage in some shops, customer disastisfaction, and employee dissatisfaction.
Introduction
Shaw's is a supermarket chain in New England, with Walmart, Market Basket, Hannaford, and Stop and Shop as its main competitors. Additional details on the company's challenges and revenue, and history, digital transformation strategy, among others, can be found below. Details on our research strategy has been provided in the Research Strategy section below.
Shaw Company Analysis
Overview
- Shaws is a chain of supermarkets located in the New England region in the U.S.
- Shaw's has 150+ stores in Massachusetts, Connecticut, Maine, New Hampshire, Vermont, and Rhode Island.
- Shaw's Supermarket has a sister supermarket called Star Market.
- The supermarket retails groceries, food, and drugs in various locations in New England and also offers online grocery delivery to customers in the area.
Revenue
- Shaw's is a private company owned by Albertson and doesn't publicly disclose its revenues.
- However, Zippia estimates that its revenue in 2021 was $7.1 billion.
- The revenue per employee is $236,667.
Founding and Funding History
- Shaw doesn't have a funding history as it has been in existence for over 100 years.
- Shaw's was founded in 1860 in Portland, Maine, by George Clinton Shaw.
- In 1919, Brockton Public Markets (BPM stores) were established by Mainer Maynard Davis.
- Davis later bought Shaw's and decided to operate the stores independently, laying the foundation of Shaw's Supermarket today.
- Davis remodeled Shaw's store to compete with other national chains.
- In 1947, Shaw's was registered as a charter member of "the New England Food Buyers Association, a buying cooperative that later became known as Topeo Associates of Chicago."
- In 1960, Shaw's expanded to Massachusetts and New Hampshire.
- The company announced sales of $71 million in 1973 and was operating 22 stores in 1974, with over 1,500 staff.
- J Sainsbury PLC acquired Shaw's in 1983.
- In 1994, Shaw's announced revenue of $1.97 billion and had 87 stores in Maine, Massachusetts, New Hampshire, and Rhode Island.
- In 1999, Sainsbury bought "Massachusetts-based Star Market stores and distribution center to operate under Shaw’s name, launching Shaw’s to second-largest supermarket company in New England."
- Albertson bought Shaw's from Sainsbury in 2004 for $2.48 billion as Sainsbury retreated from the U.S. market.
- Supervalu acquired Shaw's in 2006 as part of its takeover of Albertsons.
- In 2013, AB Acquisition LLC "acquired Shaw’s from SUPERVALU, a transaction bringing all Albertsons stores under singular ownership again."
Corporate Value and Missions
- Shaw's Supermarket corporate value and mission are based on "the philosophy of offering customers the products they want at a fair price, with lots of tender, loving care."
Products and Services
- Shwa's products include groceries, food, and drugs such as baby care products, beverages, breakfast and cereals, bakery, and bread. dairy, eggs, cheese. canned foods, baking products, spices, condiments, cookies, candies, deli, fruits and vegetables, flowers, cards, grains and pasta.
- It also includes meat and sea foods as well as international cuisines such as Asian food and Hispanic foods.
- Other products include cleaning products, personal care, pet care, wine, beer, and spirits.
- Shaw's also offers grocery delivery and pickup services.
Digital Transformation Strategy and Strategic Initiative
- While information specifically on Shaw's Digital Transformation is unavailable, Shaw's parent company Albertson's digital initiative is geared towards providing engaged and connected digital and in-store experiences.
- According to Albertson's CEO Vivek Sankaran, while speaking on the company's success in driving digital sales and growth, he stated the following:
- "These growth trends affirm our belief that engaged and connected digital and in-store experiences will result in long-lasting customer relationships and industry-leading growth. The underpinnings of the next phase of our transformation strategy."
- Sankaran further states that the company is enhancing its technology and using technology to automate tasks.
- They have also rolled out AI and ML technologies to enhance self-checkout in-stores, improve product availability, and to enhance freshness.
- The CEO also revealed that the company is upgrading its edge computing technology and migrating to the cloud.
- According to the Sankaran:
- "We are modernizing our capabilities in part through an improved supply chain, enhanced data and data analytics and ongoing productivity, all built on the foundation of being locally great and nationally strong. In supply chain, we are currently increasing automation in two of our largest distribution centers and expect to continue to roll out similar automation across our network over the next several years. We've also begun the progressive rollout of a new enterprise-wide warehouse management system that is expected to be fully implemented network-wide by fiscal 2025."
- The company's digital transformation goal is also geared towards providing an increasingly personal and curated digital experience for its customers.
- To achieve digital supply chain transformation, Albertsons partnered with Blue Yonder and leveraged its "artificial intelligence (AI) and machine learning (ML) to achieve supply chain improvements that enhance operational efficiency – and their customers’ experience."
- The goal of the initiative is to enhance the company's entire supply chain data analytics capacities, improve freshness and in-stock conditions of goods, and reduce cost of serving customers.
Tech Stack
- For its customer analytics and tracking, Shaw's Supermarket uses Rapleaf, Everest Technologies, Google Analytics, Omniture Site Catalyst, Adobe's suite of analytical tools, App Dynamics. Nuance, Blue Triangle Tech, Microsoft Clarity, Facebook Signal, among others.
- Shaw's widgets include Touch Commerce, Apple Whitelist, Periodic, Okta, Google Tag Manager, Google Font API, among others.
- The company's framework includes Java EE, Angular, Google Domain Verification, Facebook Domain Verification, among others.
- Shaw's Supermarket content delivery network includes CDN JS, AJAX Libraries API, Cloud Front, Amazon S3, CDN JS, among others.
- The content management system is built with Adobe CQ and Adobe Experience Manager.
- For Advertising, the company uses Google Adsense, DemDex, Adobe Audience Manager, DoubleClick, Facebook Custom Audience, Evidon, among others.
- The company uses Symantec, Microsoft Exchange Online, SPF, and DMARC for email management.
Shaw's Key Competitors
- Shaw's key competitors are Stop and Shop, Market Basket, Walmart, and Hannaford.
- According to Shelby's market data, the supermarkets in New England with the top market shares in 2021 are Stop & Shop (16.09%), Market Basket (15.95%), Walmart (13.38%), Shaw’s Supermarket (13.13%), and Hannaford’s Supermarket (8.4%).
Stop and Shop
- Stop and Shop's website can be accessed here.
- Stop and Shop is a chain of supermarkets that was founded in 1892.
- The supermarket retails groceries such as beverages, breakfast and cereals, bakery, and bread.
- They also offer online delivery of groceries.
- The supermarket also has a pharmacy for drugs.
Why it's a Competitor
- Stop and Shop is considered a key competitor because it has a heavy presence in New England like Shaw's.
- In addition, Stop and Shop is listed as a key competitor of Shaw's or as a popular supermarket in various reports such as reports from Visiting New England, WCVB, and Boston.
- Stop and Shop has a market share of 16.09% in New England, the fourth highest in New England, according to Shelby's market data.
- It also has over 240 locations in New England (Massachusetts, Connecticut, and Rhode Island).
Company's Footprint
- Stop and Shop has over 401 locations in five states and 317 cities in the U.S.
- The states it has stores in are Massachusetts, Connecticut, New York, New Jersey, and Rhode Island.
- Massachusetts accounts for 31% of all the company's stores, with 126 store locations.
Market Basket
- Market Basket's website can be accessed here.
- Market Basket is a supermarket that retails groceries such as beverages, produce, sushi, eggs and dairy, among others.
- Market Basket was founded in 1917 in Lowel, Massachusetts.
Why It's a Competitor
- Market Basket is considered a key competitor because it has a heavy presence in New England like Shaw's.
- Market Basket is listed as a key competitor of Shaw's or as a popular supermarket in various reports such as reports from Visiting New England, WCVB, and Boston.
- Market Basket has a market share of 15.95% in New England, the fourth highest in New England, according to Shelby's market data.
- The company also has at least 87 store locations in New England.
Company's Footprint
- Market Basket has 90 store locations in the U.S.
- The stores are located in Massachusetts (54), New Hampshire (32), Rhode Island (2), and Maine (2).
- The company's headquarters is in Tewksbury, Massachusetts.
Hannaford
- Hannaford's website can be accessed here.
- Hannaford is a chain of supermarkets that was founded in 1883.
- The supermarket retails groceries such as beverages, breakfast and cereals, Deli, baked food, and bread.
- They also offer online delivery of groceries.
- The supermarket also has a pharmacy for drugs.
Why It's a Competitor
- Hannaford is considered a key competitor because it has a heavy presence in New England, like Shaw's.
- Hannaford is listed as a key competitor of Shaw's or as a popular supermarket in various reports such as reports from Visiting New England, WCVB, The Packer, and Boston.
- Hannaford Supermarket has a market share of 8.4% in New England, the fourth highest in New England, according to Shelby's market data.
- The company also has at least 184 store locations in New England.
Company's Footprint
- Hannaford has 184 store locations in the U.S.
- The stores are located in Massachusetts (54), New Hampshire (32), Rhode Island (2), and Maine (2).
- The company's headquarters is in Tewksbury, Massachusetts.
Walmart
- Walmart's website can be accessed here.
- Walmart is a national grocery chain with a strong presence in New England.
- The supermarket retails groceries such as beverages, breakfast and cereals, Deli, baked food, and bread.
- They also offer online delivery of groceries.
- The supermarket also has a pharmacy for drugs.
Why It's a Competitor
- Walmart is considered a key competitor because it has a heavy presence in New England, like Shaw's.
- Walmart is listed as a key competitor of Shaw's or as a popular supermarket in various reports such as reports from WCVB, The Packer, and Boston.
- Walmart Supermarket has a market share of 13.13% in New England, the fourth highest in New England, according to Shelby's market data.
- The company also has at least 184 store locations in New England.
Company's Footprint
- Walmart has 4,735 store locations in the U.S.
- The stores are located in Massachusetts (48), New Hampshire (26), Rhode Island (9), Connecticut (33), and Maine (22).
- The company's headquarters is in Bentonville, Arkansas.
Corporate Challenges Facing Shaw's
Low Patronage
- Shaw's Supermarket is suffering from low patronage, according to Eat This.
- Eat This ranked Shaw's as number one in a list of stores in the New England area that are empty,
- For the second time in 2022, Shaw's announced store closures in Maine due to lack of success and a bleak future outlook.
- This is a result of Shaw's losing customers to its competitors, such as Market Basket.
Why It's a Challenge and Impact
- Low patronage in some of its stores is a big challenge as the stores are unsustainable when the patronage is too low.
- The impact is low revenue and the company having to shut down store locations.
- Store closures lead to employees losing their jobs.
- Store closure due to low patronage also leaves a large space in a prime location in the city.
Poor Customer Satisfaction
- Customer Satisfaction at Shaw's is low.
- Consumers' Checkbook ranked the top five supermarkets in New England based on quality and price, and Shaw's didn't make the list.
- According to Consumer Checkbook, Shaw's is seeing competition from all sides, and it appears to be losing the competition.
- On Facebook, customers rate the company 2.1/5.
Why It's a Challenge and Impact
- Poor Customer Satisfaction leads to low patronage.
- The company ends up losing customers to competitors, affecting the revenue and profitability of the business.
- Unsatisfied customers also leave negative feedback and rating, which will also prevent other customers from patronizing the business.
Employee Dissatisfaction
- In 2021, dozens of Shaw's drivers and mechanics who are part of the Teamsters Local 340 union went on strike.
- In all, about 70 workers went on strike in Maine.
- This was a result of contract negotiations breakdown after 20 meetings with the company.
Why It's a Challenge and Impact
- Striking drivers affect the shipment of goods and produce to Shaw's supermarkets in the New England region.
- This can also negatively affect customer satisfaction as shoppers can't find the products they want.
- Strike from unions may also result in customers going to the competition to buy essential goods.
Research Strategy
For this research into Shaw's company analysis, our research team leveraged the most reputable sources of information that were available in the public domain, including data from Shaw's and Albertsons' (the parent company) website, media and industry reports such as Eat This, Boston, The Packer, Zippia, Statista, Scrape Hero, among others. To find the company's competitors, our research established that Shaw's operates in the New England region. Hence, we focused on top supermarkets in the New England region competing for market share in the space. We were able to find a report that ranked the top supermarkerts in New England by market share from which we extracted the top competitors. We also took into account each competitor's presence in the New England area as well as those noted in at least three reports as major players in the region. To select the top challenges facing Shaw's, we relied on media reports of issues the company is facing recently, as Shaw's is a private company that doesn't publish a detailed annual report. We were able to find the recent challenges and have reported them above.