Harris Teeter reclaimed the No. 1 spot and Food Lion edged past Wal-Mart Supercenters in the latest market share rankings for Charlotte’s highly competitive grocery scene.
Despite their moves up in the rankings, Harris Teeter and Food Lion both saw their market-share percentages slip, as new competitors such as Publix took a bigger piece of the market, according to the rankings from Chain Store Guide, a sales-tracking firm.
And Wal-Mart is still the biggest grocer in the city, when the market share for its Supercenters, Neighborhood Markets and Sam’s Club stores are added together. Supercenters and Sam’s Clubs saw their market shares decline, while the Neighborhood Markets saw increases.
As Charlotte’s grocery wars heat up, supermarkets are getting creative with the ways they fight to draw in shoppers, whether it’s by renovating stores, adding new prepared food options or experimenting with smaller, simpler store concepts.
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That’s a trend happening nationwide, and stores know they have to innovate to remain competitive, said Phil Lempert, a supermarket analyst.
“That traditional store, that 45,000-square-foot supermarket, is really a dinosaur and needs to change,” Lempert said. “Whether it’s adding more food-service offerings, becoming a groceraunt (a grocery and restaurant), doing delivery. These are the kinds of things they need to do to stay alive.”
Matthews-based Harris Teeter was acquired by Kroger in a $2.5 billion deal in early 2014. Since then, it’s been spiffing up its stores with new features such as wine bars, growlers, gas stations and more food-service offerings, all evidenced in new stores like its biggest ever in Pinehurst, which opened in January.
The grocer commanded 19.4 percent of Charlotte’s grocery market in 2015, down from 19.7 percent the prior year.
Last year, the grocer announced plans to expand its prominent Cotswold location, which will have a Publix across the street, and open a retro-designed store in South End in the Sedgefield shopping center redevelopment, just down the street from the new Publix on South Boulevard.
A company representative could not be reached for comment.
Another North Carolina grocer, Food Lion, also rose in the market share ranks.
The Salisbury-based grocer last year was the region’s No. 2 supermarket chain, up from No. 3 the year before. It held 19.1 percent of the area’s grocery market share, down from 19.2 percent.
Food Lion is betting that some big investments in the Charlotte area will pay off. Earlier this year, the grocer announced that it is spending $215 million to remodel 142 stores in the Charlotte region in new, easy-to-navigate formats with new decor as well as lower prices.
“Food Lion is very pleased with its continued momentum and strong performance in the Charlotte market,” spokeswoman Christy Phillips-Brown said. “(We) appreciate our customers’ loyalty in this area given our deep roots and strong heritage in North Carolina.”
Right behind Food Lion was Wal-Mart, which previously held the No. 1 spot. With its Supercenters, the retail giant had 19 percent of Charlotte’s market share, said Chain Store Guide, which only counts Wal-Mart’s grocery sales for its report.
When the market shares of Supercenters, Sam’s Clubs and Neighborhood Markets are all combined, Wal-Mart commands the largest portion of Charlotte’s grocery dollars, or 26.6 percent.
The retail giant’s financial performance companywide has suffered as shoppers gravitate away from big-box concepts and shop more online. Wal-Mart reported a drop in its revenue last year for the first time in company history, and earlier this year, the company said it was closing 269 stores, including 17 in North Carolina.
Wal-Mart has been growing its market share with its Neighborhood Market concept, its own version of a traditional grocery store. Neighborhood Markets were Charlotte’s No. 10 grocer last year and commanded 2 percent of the market, up from 1.4 percent the year before.
The Neighborhood Market concept, Lempert said, is “much more relevant than your typical Wal-Mart to consumers.”
“Our customers in Charlotte like having the choice and convenience of shopping at our Neighborhood Market stores and we’re proud to offer them the opportunity to get the items they need at everyday low prices,” said Phillip Keene, a Wal-Mart spokesman.
And Wal-Mart’s Sam’s Club was Charlotte’s No. 5 grocery chain last year, tied with Bi-Lo. Sam’s Club took 5.6 percent of the market, down from 6 percent the year prior.
The other grocer that grew its market share in 2015 was Florida-based Publix, which entered the Charlotte market in early 2014 with a store in Ballantyne. It commanded 6 percent of the local grocery market share last year, up from 4.8 percent the year before.
“Our stores over the last two years have truly done better than we had projected,” said Publix spokeswoman Kimberly Reynolds.
Last year, Publix opened three Charlotte-area stores – in Concord, South End and Mint Hill – bringing its local store count to 14.
Reynolds has also said Publix “would love to be in uptown” Charlotte one day, though no known plans are yet underway.
Charlotte-area grocers by market share
1. Harris Teeter
2. Food Lion
5. (tie) Sam's Club
5. (tie) Bi-Lo
8. (tie) SuperTarget
8. (tie) Aldi
Source: Chain Store Guide