As the household budget tightens in uncertain economic times, many grocery shoppers are constantly looking for the best deal in town. To attract and retain these savvy shoppers, a supermarket should understand what they value most and how they comparison‐shop. With this in mind, this paper aims to develop a set of benchmarks that helps supermarkets monitor their service delivery process, identify relative weaknesses, and take corrective actions for continuous service improvements.
This paper proposes analytic hierarchy process (AHP) and competitive gap analyses to measure the service performances of supermarket franchises in the Southeastern USA. It also uses exploratory factor analyses to identify salient factors influencing the service performances of supermarkets.
This study found that a service attribute considered most important to the supermarket customers' impression of service quality was product quality. It was followed by cleanliness of the store, competitive price, product variety and fast checkouts. This study discovered a direct correlation between the relative service performance of the supermarket and its “word‐of‐mouth” reputation. Supermarket customers tended to favor large‐scale, national supermarket franchises such as Meijer, Kroger, and Wal‐Mart than small‐scale, regional counterparts such as Pic‐Pac, Aldi, and Save‐A‐Lot in terms of overall service quality.
The sample of the current study was primarily represented by customers in the Southeastern USA. Thus, the sample used in this study may not reflect the opinions of the general public in the USA.
This paper provides practical guidelines as to how supermarkets can cope with increasing competition and changing customer needs by measuring their service performances relative to their leading competitors and improving their service performances continuously.
This paper identifies service attributes that shape the customer perception of supermarket service quality and uncovers the areas of weaknesses in the supermarket franchises' service offerings. In addition, it helps supermarkets formulate the future survival and growth strategies by providing the detailed picture of where they stand in terms of competitiveness. This paper is the first attempt to utilize AHP to develop performance benchmarks for supermarkets in the increasingly competitive grocery industry. The proposed AHP can be easily modified or extended to similar service settings in other regions of the USA and other countries in Europe and Asia.
