How Loblaws and Sobeys are Connecting with South Asians in Canada
Canadian South Asians are rapidly becoming one of the most sought after groups among grocery retailers. Why? Because they have big families. Besides children, parents and grand parents often live in the same home. They consume everything the average Canadian family needs, but in bigger quantities. Additionally, they want high quality ethnic foods—all the spices, sweets, lentils, and produce required for whipping up delicious curries and other cultural dishes.
It was in 2012 that Jas Athwal, Director of ethnic merchandising at Overwaitea Food Group, learned a valuable lesson: “if the customer doesn’t shop with you today, it’s because you don’t have what they’re looking for.”
He had been struggling to figure out why onions—a staple of South Asian cooking, weren’t selling well at their Surrey location. All that changed when he replaced the 5, 10, and 25 pound bags with 50-pound bags. The onions were better quality and positioned at the front of the store. The new strategy worked, and the 50-pound bags sold out within a week.
“South Asian shoppers”, emphasizes Atwal, “want high-quality basics such as onions, ﬂour, lentils and spices at competitive prices.”
Since then, lessons have been duly digested and resulted in stores like Save on Foods International, a new Surrey-based store, which carries many authentic brands from India, China, Philippines, Germany, and the UK.
This is just one example of how big-box retailers are trying to court South Asian consumers. Out east, Loblaws and Sobeys are also working out how to capture their slice of the pie. Part of the reason this has become so important is Canada’s changing demographics. According to Statistics Canada, the South Asian population in Canada is projected to grow to 8.7% in 2031 from 4.1% in 2006.
While many grocery stores have traditionally carried selections of ethnic foods, many South Asian immigrants and their descendants have complained that the products are “watered-down versions,” says Salima Jivraj of Halal & Co Media, a marketing firm based in Ajax, Ont. that has done focus groups with South Asian shoppers.
Rather than viewing this as a challenge, smart marketers have seized the opportunity to create a more authentic in-store experience and advertise aggressively to the community. In the Toronto suburb of Brampton, Sobeys launched Chalo (let’s go in Hindi) FreshCo. In the fall, the store stocks up on fireworks, Indian sweets, and bags of flour—all staples of the Diwali festival. Like any other demographic, their marketing strategy hinges on showing customers that they’re understood and welcomed.
Additionally, it seems that Canadian South Asians often prefer the big-box experience. Research from Pearl Strategy Innovation, a consulting ﬁrm in Toronto, shows that South Asians living in Canada for a while prefer to shop at conventional stores, especially if it means saving money and time. As managing partner Susan Weaver says, “Indian stores are more expensive and the location is challenging.” Additionally, many of these stores are small and have limited stock, which can mean multiple stops on a single trip.
To catch the elusive South Asian consumer, retailers need to consider their audience. This is a group that consumes a lot of chicken, eggs, milk, and fish—in addition to spices, lentils, and rice used in ethnic cooling. Reaching South Asians effectively means altering the cookie-cutter formulas to meet their needs—and welcoming them through targeted marketing.