Four Things Grocery Stores Can Learn From Erewhon Market

While grocery stores nationwide have been struggling to revive their stores, Los Angeles-based Erewhon Market has been growing more than 35% year-on-year since 2016. And with a recent private equity deal from Stripes Group, Erewhon Market now has the chance to completely redefine the standards of what a modern grocery store brand of the future should look like.

If you’ve never heard of Erewhon Market, Erewhon Market is an organic grocer and cafe based in L.A that has gained a cult-like following in the health + wellness world. It first began back in 1966 as a tiny retail store selling macrobiotic and natural foods by husband and wife Michio and Aveline Kushi in Boston and quickly became the first natural foods wholesale and distribution company in the U.S.

However, what started as seemingly humble beginnings has quickly changed since current owners Tony and Josephine Antoci purchased the store in 2011. Since then, Erewhon has become the aspirational, go-to grocery store brand transforming the health + wellness landscape. Here are four things that every grocery store can learn from Erewhon Market.

Erewhon Understands its Consumer

• Erewhon is made for the health-conscious millennial customer who lives in LA. Their stores are located in areas where their customer lives or hangs out: Santa Monica, Calabasas, Pacific Palisades, Venice, Fairfax and soon, in Silver Lake and Studio City.
• Erewhon’s buyers also are constantly on the lookout for new and upcoming health + wellness products they know customers will love. If shoppers find products through social networks or at farmers markets that Erewhon doesn’t carry, the buyers will actively source and vet those brands for them as well. This has created an open, welcoming community that customers love.
• Erewhon maintains an active Instagram, with 94.8k followers — they portray an aspirational portrait through photos of healthy foods, celebrities shopping at their stores, etc. This in turn creates a brand halo effect that keeps customers coming back for more.

High-Quality Product Curation + Nimble Merchandising ⇒ Phenomenal Experience

• In-Store: Most grocery stores stock the same products as their competitors with little variation. Erewhon instead rethinks their shelves from the ground-up for their specific customer. Staple brands like Kellogg’s or Frito-Lay that take up prime real estate at every other grocery store are replaced with gluten free cereal brands and healthy chickpea puffs. As a result, Erewhon has been able to transform the same amount of shelf space into a highly relevant place of discovery for their specific customer.

Focused on Building Relationships with Suppliers

• Traditional retailers have created rigid processes that make it difficult for small, mom-and-pop suppliers to easily get stocked in their stores. Slotting fees and free fills have made it prohibitively difficult to start selling in their stores.
• Instead, Erewhon makes it seamless and easy for mom-and-pop suppliers to start selling in their stores immediately — this accomplishes a few things: 1) Suppliers feel a sense of trust and gratefulness — as a result of this easy on-boarding process, Erewhon is often the first retailer to stock these brands, and as a result these brands feel a sense of loyalty towards Erewhon leading to longer term relationships. 2) This is also good for customers because it increases Erewhon’s selection and as a result customers are able to discover more products at their stores.

Continuing to Innovate on Delightful Experiences

• Erewhon continues to innovate for their customer with a membership program and private label offerings.
• Membership Program: For just $200, you can access member’s only discounts, merch, events, sampler’s boxes, and etc.. This is important because it is a way for Erewhon to retain and delight its best customers.
• Private Label Offerings: Unlike traditional retailers that create private label products to provide cheaper alternatives to existing options, Erewhon creates specific private label products that are new to the market, like organic bone broth cleanses. This is radically different because Erewhon doesn’t undercut its suppliers and uses private label as a way to supplement its selection.

Do you love Erewhon too? If so, I’d love to hear other things you think Erewhon is doing well in the responses below. Or hit 👏🏻 if this was helpful or follow me on Twitter for more 🙏🏼