I know I am late to this thread, but thought I'd throw in my 2 cents, since like my wife mentioned I don't work FOR Kroger, but am sort of like a contractor for them that helps write their store planograms (the plan that shows where items go on the shelf and within the store).
Part of the reason Kroger is so good is that they target their existing customers rather than spending a lot of time trying to gain new ones. The saying I have heard is, it costs you as much to keep a loyal shopper as it does to bring in 10 new shoppers... and at the end of the day, the loyal shopper is more likely to spend more than the 10 new shoppers combined over their purchasing life.
With Harris Teeter, Kroger has no interest in going in there and turning them into Kroger stores. They have a model that works, so Kroger is trying to learn what they can from them while also realizing cost savings through streamlining their operations with the rest of the Kroger operations in the South.
I have also heard that Kroger considers Wegman's a "special competitor", which is part of the reason they have not entered the Northeast market. The cynic in me says it is because of the strong union presence in the NE, which makes it difficult for Kroger to stay competitive on prices in union markets with Walmart.
Kroger is suffering from the deflation problems that are plaguing the entire industry, but are better equipped to weather it than most. Though to combat it internally, they just went through a round of early retirement and position elimination at their main offices and regionally. They just failed to increase their same store sales growth for the 51st quarter in a row... so for 12 years they had a pretty strong track record and are scrambling to get back to it.
This is a personal topic to me, so sorry for the novel. But yeah, Kroger is where it's at... unless you live where one isn't. But never Walmart. Never.
--Mr. DT
