Gelson’s Markets’ formula for success

Gelson’s Markets BB #:113119 made the strategic decision to provide the best possible customer experience within a smaller number of stores rather than overexpanding.

An example of Gelson’s careful expansion was its 2016 entry into the San Diego market.

When Northwest-based Haggen announced it was closing in late 2015, Gelson’s bought three locations in Del Mar, Carlsbad, and Pacific Beach/La Jolla, all areas with an upscale demographic.

The company even hired many of the laid-off Haggen employees.

“San Diego was a little tougher than recent store openings in West Los Angeles and the San Fernando Valley, where we were already well known,” recalls Paul Kneeland, senior director of produce and floral at Gelson’s.

“The San Diego stores are slightly smaller than our usual footprint, and that helped ease our entry into the marketplace.”

The company viewed the new stores as an opportunity to attract ‘foodie’ customers looking for high-quality groceries and services, even though San Diego County was already home to four Whole Foods Markets.

Gelson’s president and CEO, Rob McDougall, didn’t fear the competition; he believes Gelson’s is different, especially when it comes to selection.

Unlike Whole Foods, it doesn’t prevent customers from buying certain products. Case in point: Whole Foods doesn’t sell Diet Coke, but Gelson’s does.

This an excerpt from the California Supplement to the May/June 2022 issue of Produce Blueprints Magazine. Click here to read the whole supplement.