Daniel Läubli: Albert Heijn is one of the few supermarket chains in Europe that has continued to gain market share over the course of the past six years. What’s the magic ingredient of its success?
Marit van Egmond: Of course, there is no single magic ingredient. That would be too simple. There are several key ingredients. The most important one is our rigorous customer focus. We work every day to be as close to our customers and their changing needs as possible. We aspire to see the differences between customers and to respond to what each one of them expects from us. This ensures that we are really there for everyone.
A second ingredient is our integrated approach. For customers, it shouldn’t make a difference where they are shopping—online, in our app, in one of our supermarkets, or in one of our convenience stores. It’s always Albert Heijn with one integrated experience, one promise, and one voice. This familiarity builds trust. To make this happen, we must behave as one company and as one team, following one strategy. It may sound simple, but it really isn’t when you are an omnichannel player with €20 billion in sales managing supermarkets, convenience stores, and a mature online channel in two countries. It requires relentless attention to everyday execution and continuous adaptation of the organization. I’m not only thinking about structures but also about how the work is done—in agile teams that are focused on business value and getting the right resources to make a positive impact on the lives of every customer.
A third ingredient of our success is our transition from a supermarket to a food and tech company. In addition to our store-related investments in digital screens, electronic shelf labels, and self-service checkout stations, we have taken great strides in mechanizing our two most recent e-commerce fulfillment centers. The most significant impact we have achieved in the digital domain was driven by the Albert Heijn app. Six years ago, the app had 200,000 monthly users. Today, it has five million monthly users. Our customers frequently use the app for shopping, inspiration, and easy payments. We now have more than 1,000 people working in our data, digital, and tech community. We are not a supermarket. We are a food and tech company.
We are not a supermarket. We are a food and tech company.
Daniel Läubli: A lot of CEOs say their companies are customer-centric. What do you do differently at Albert Heijn?
Marit van Egmond: For Albert Heijn, giving customers what they want is a real obsession. We always try to anticipate what customers expect from us. In 2019, for example, we were struggling to offer the value for money customers were looking for. In response, we launched our “Price Favorites” range that offers the best prices and great quality. We moved from three to two price tiers by delisting our entry-price private label, and we reduced the prices of our best products. We also encouraged our employees to take pride in these “no compromise” products. It wasn’t easy to pull this off economically, but we made it work by adopting a step-by-step approach. Today, our Price Favorites range comprises more than 2,000 items that frequently win consumer tests. It’s this intense passion to make things work for the customer’s benefit that truly makes the difference.
Daniel Läubli: How does your commitment to customers translate into growth?
Marit van Egmond: It’s a question of making a plan, both for organic and for nonorganic growth, year in, year out. This enables us to prioritize resources and steer the organization effectively. Although Albert Heijn has nationwide coverage, we still see blank spaces where we could open new stores or add online delivery areas. One example of our growth priorities is AH to go, our convenience format. There is strong demand for these smaller stores in high-traffic locations, especially in railway stations. In 2019, we had nearly 100 AH to go stores. Now, we have almost 200. Our store network in Flanders has grown from 50 to more than 80 stores in the last six years, and our online sales now account for 10 percent of our business.
Daniel Läubli: How important are your own brands to your success?
Marit van Egmond: Our own brands are vital to our success, as they are of major importance for organic growth and customer loyalty. We have over 11,000 products from our own brands in our assortment year-round, and they account for roughly 55 percent of our revenue. They are a central enabler of our commitment to customer satisfaction, sustainability, and healthy eating. Customers want healthy choices, and we have made it our mission to fulfill this expectation. Our organic range includes 1,900 products, and it’s the widest organic offering in mainstream supermarkets in the Netherlands. Additionally, we launched 250 plant-based products under the new AH Terra brand in 2023. These products are only available at Albert Heijn, and they set us apart from our competitors as a retailer that is fully committed to healthy eating.
While we ensure affordability with our Price Favorites range, we created our own brands in typical A-brand categories like coffee, chocolate, and beer to differentiate our offering. These products have a unique taste and stand out versus their A-brand equivalents in terms of both quality and price. Thus, our own brands yield a triple benefit: superior customer satisfaction, a clear differentiation from our competitors, and more independence in categories in which A-brands are leading in the minds of customers.
Daniel Läubli: Other grocers also have their own brands. What do you do differently?
Marit van Egmond: We develop our own-brand products ourselves based on a strong conviction: If you don’t develop your own products, you’re just one of many wholesalers. We have our own concept department, our own design department, and our own packaging department. We focus on developing new concepts, particularly for fresh products, where we can add the most value for the customer. Examples of this are our fresh cooking packages, our tapas range, and our fresh juices. Not only are we focused on innovation, but we also strive constantly to improve our own-brand products in every relevant respect: taste, ingredients, origin, customer convenience, packaging, and sustainability.
We are also absolutely rigorous about quality. Our brand name is on these products, so it’s our responsibility to ensure flawless quality and great taste. Affordability is obviously important, but quality always comes first.
Affordability is important, but quality always comes first.
Christel Delberghe: How does your commitment to quality and innovation play out in the fresh food department?
Marit van Egmond: We constantly test fresh produce as our offering changes with the seasons, and we always want to make sure we have the best produce on our shelves. We have had strong, strategic partnerships with our five major fresh suppliers for decades, with fully aligned ambitions and with an “open book” bookkeeping method. This collaboration rests on mutual trust and the long-term perspective we share. We work together to maximize customer value, improve the value chain, and develop new products and concepts.
One example of how this plays out in practice is AH Sprank, our own variety of apples that was created in collaboration with a group of growers. We let it ripen on the tree a little longer than usual so that it gets a unique taste—sweet and juicy, with a touch of sourness. Sprank is available exclusively at Albert Heijn, and it was voted the best product of the year for the third time in a row. Isn’t that a delicious result of a long-term relationship?
Christel Delberghe: Absolutely. Looking ahead, what are some of the trends you expect to shape grocery in the coming years?
Marit van Egmond: The impact of technology, a new service standard, and healthy eating are at the top of my list. The development of technology will keep reshaping grocery retail. I cannot yet foresee all of the future possibilities of AI, but I am very optimistic, and I am aware that it will change the game—not only regarding the customer proposition but also in areas like automation, demand forecasting, and transport routing.
As far as service is concerned, the expectations of customers are changing fast, and grocers need to respond to that. In the old days, service might have been about helping shoppers pack their groceries at the checkout and carry their bags to the car. Today, customers expect a hyper-personalized experience, no matter where they are shopping—in a store, on our website, or through our app. Technology enables us to recognize returning customers and fulfill their expectations while maintaining that all-important personal touch.
Christel Delberghe: You also mentioned healthy eating. How do you expect that to evolve?
Marit van Egmond: Healthy eating has long been a key concern for many of our customers. They want less sugar, less salt, less fat, less processed food, more protein, and more fiber. But it doesn’t stop there. Healthy eating is now a lifestyle for many of our customers. Since we pride ourselves on anticipating and fulfilling the needs of our customers, we will be there to offer whatever they are looking for. Examples include food with additional benefits, such as tea that helps them sleep better, food that helps them stay fit and vital as they get older, inspiration on how to exercise during the day, how to achieve and maintain relaxation, or how to prevent everyday ailments.
Overall, customers expect more transparency about the dilemmas we are facing as a grocer. People want to be involved in the discussion, and they want their voices to be heard. That’s the most important thing in grocery retail: keep listening and stay close to the customer. That’s our special sauce.
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