Executive Summary

• The Fung Global Retail & Technology team attended Kroger’s 2016 Investor Conference this week at the headquarters of Kroger’s 84.51° division in Cincinnati, OH. Investors and analysts who attended were also invited to tour the company’s largest store.
• Kroger possesses a unique culture focused on hard work, modesty and a drive to continuously improve while not underestimating its competitors.
• In its 84.51° division, Kroger processes a huge amount of data that it collects from social media and customer feedback. It uses the data to create personalized communications featuring yellow tag sale items, digital coupons, weekly ad items and predictive shopping lists. The use of data has enabled Kroger to increase customer loyalty, which in turn has increased average basket size.
• Kroger has benefited substantially from key acquisitions such as 84.51°, which provided data analyticssis capabilities, and Harris Teeter, whose technology helped create the ClickList click-and-collect platform.
• Management highlighted the “four keys” that underpin Kroger’s strategy: people, prices, products and experience.
• Kroger strives to be a model corporate citizen and is focusing on sustainability in its supply chain and on eliminating waste, as well as on social outreach programs such as ending hunger.