Dive Brief:

• Giant Food Stores will open its second Giant Heirloom Market location August 2 in the University City neighborhood of Philadelphia, the company said in a press release emailed to Grocery Dive. The first Giant Heirloom Market opened in Philadelphia in January, and two other locations are being planned in the city.
• The new store will be just 9,950 square feet and feature local and seasonal foods, grab-and-go meals, fresh sushi, a gourmet cheese section, plant-based and gluten-free foods, kombucha on tap and a curated wine and beer selection. It will also sell items from Giant's Nature's Promise private label brand.
• Shoppers at Giant Heirloom can utilize Giant Direct, Powered by Peapod for grocery pickup and delivery as well as Giant's Scan It mobile app to aid their in-store experience.

Dive Insight:

Large grocers are making notable progress with small concept stores that offer stronger local ties, a neighborhood feel and more limited but specially curated product assortments. In many cases, these banners are designed for busy urban shoppers who want high-end grocery items for cooking at home or healthy, convenient prepared food items.

An interesting aspect of Giant Heirloom Market is that the stores are, so far, planned only for Philadelphia. In addition to Pennsylvania, the grocer operates in Maryland, Virginia and West Virginia. The company hasn't indicated why the banner is concentrated in Philadelphia, but the strategy makes sense with strong brand recognition and a solid customer base in the city. Giant Heirloom Market could leverage its success and growing reputation should the company choose to expand to new markets.  

Other grocers are investing heavily in specialty banners, too. Publix just announced its 11th GreenWise market location in Tampa, Florida. The GreenWise banner is focused on foodies and offers a natural, organic shopping experience, house-made food items and an extensive prepared foods section. The company has made rapid progress with its GreenWise format, announcing the first store in October last year.

Food retailers are counting on small formats and specialty banners to boost their relevance among key demographics, especially in urban areas where traditional supermarkets don't resonate as much. A recent report from real estate firm CBRE suggests that the number of small formats will increase as grocers try to diversify their portfolios to maintain market share. 

Despite their small size and focus on in-store experience, banners like Giant Heirloom and GreenWise still need to offer customers e-commerce and apps to meet their various shopping preferences. This helps with shopper satisfaction, but it's also a good way for retailers to tie the small format experience to larger brand loyalty.