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By Eve Lazarus – Marketing Magazine
Dubbed the “Asian Loblaws,” B.C.’s T&T is in expansion mode. As ethnic supermarkets take off, you can bet your bok choy major grocers are taking notice
It’s a perk of growing up in Vancouver: while my youngest son will turn up his nose at steak or chicken, he’ll dive into a steaming bowl of Haw Gao or Sui Mai dumplings. It’s one of the reasons we’ll drive across town to shop at T&T Supermarket for sushi and dim sum. Clearly as Caucasians we’re in the minority-the vast majority of the chain’s customer base is Asian-but that’s changing. A decade ago I had the only blond kids in the grocery store; today Caucasians make up between 5% and 40% of customers, depending on the store’s location.
The first T&T store, which opened in Burnaby, B.C. in 1993, was hailed for its modern supermarket format, a far cry from the typical dingy Asian grocers in the province. Cindy Lee, T&T’s founder and CEO, and a Taiwanese immigrant, now oversees 16 stores: eight in Metro Vancouver, two in Calgary, one in Edmonton and five in the Greater Toronto Area. T&T-a joint venture of California-based Tawa Supermarket, Taiwan’s Uni-President Enterprises and Canadian investors-is now the largest Asian supermarket chain in the country.

It’s not hard to see why. The stores are bright and clean and the produce is fresh. All stores have a seafood section where you can watch lobster or tilapia swim in a tank above live jumbo prawns, conch, sea snails and geoduck clams. In the fresh produce section you can find all the usual fruits and vegetables, as well as more exotic breeds such as a Thai monthong durian. There’s an in-house bakery and a gourmet section that offers ready-to-eat Chinese dishes. While the familiar aisle signs are in Chinese and English, alongside the usual pasta and bread offerings you’ll find wasabi, coconut milk and sushi seaweeds.
While T&T is dubbed the “Asian Loblaws” because of its size and popularity, Melina Hung, the company’s Richmond, B.C.-based marketing manager, says it’s an unrealistic comparison. “We are the largest Asian supermarket chain, but it’s very small compared to any kind of mainstream operation.” Hung acknowledges the company is in expansion mode, but adds it’ll take 10 years to double in size to 32 stores-a long way from Loblaw, which has more than 1,000 stores across the country.
A typical T&T store is between 35,000 and 55,000 square feet, located in traditional Chinatowns as well as more cosmopolitan areas. The product mix changes according to the ethnic makeup of the area. Hung won’t give a budget, but says most of the in-house advertising revolves around weekly price specials in ethnic media and on the company website (see “T&T’s Marketing Staples,” on page 52).
As well as the typical challenges for a supermarket, such as finding a big enough location-T&T usually draws customers from up to 20 minutes away-the chain also has to find a staff of between 150 and 250 who speak Chinese and English and understand Asian products in several different departments. “Because we specialize in Asian products, staff has to be able to read the labels and know what they are handling,” says Hung. “They’ve got to understand how products are used in cooking, and they need to speak English because a lot of customers are English-speaking even though they might be Asian.”
While staffing can be a challenge, T&T has no trouble attracting and retaining Asian-Canadian customers. Asians are the largest ethnic population in Canada “and they weren’t being serviced by any cohesive organization,” says John Scott, president of the Canadian Federation of Independent Grocers. T&T has “done something unique and high quality. I’m very impressed in how they are taking advantage of the Canadian market.”
Scott Cho, associate vice-president at Leger Marketing in Toronto, says T&T really understands the ethnic community. “T&T started out as a Chinese community-based grocery store, but now it’s expanding its portfolio, much like how our demographic is expanding.”
With StatsCan forecasting that by 2017, roughly half of all visible minorities in Canada will be South Asian or Chinese, with the population of each community estimated at 1.8 million, the rewards of marketing to these communities are huge. And big grocery retailers are certainly paying attention.
Kevin Groh, director of corporate affairs at Wal-Mart Canada, says for the last year, the chain has used demographic research to identify population clusters around its stores. “When you overlay ethnic population demographics on any large city map, it paints quite a picture. When we look at those maps, some of the most culturally varied pockets have Wal-Mart stores right in the middle,” he says.
Groh says Wal-Mart has a “store of the community” program created to ensure stores hire people, stock products and support charities that reflect the surrounding area. “There are 10 stores within about an hour’s drive from our Mississauga home office in which 15% to 40% of the local customer population has multicultural origins. Surrey, B.C. has two stores with customer populations that are nearly 50% South Asian. Similar situations are appearing in markets across the country. Each one will affect the products we choose and the way they are marketed on the sales floor.”
Groh says in Wal-Mart’s Supercentre format, international foods represent about 10% of the product mix with more than 1,000 ethnic offerings in categories such as music, greeting cards, hair dyes and cookies. “There’s no question our international food program will grow. There’s still a sense of amazement among our customers when they see unique Asian produce or specialized products to help them celebrate Diwali or Ramadan or Passover. But, more and more, these considerations will be the price of entry in markets across Canada. Hopefully, Wal-Mart is getting ahead of the curve.”
David Gray, a retail consultant with Sixth Line Solutions in Vancouver, says instead of just tweaking between product categories and quantities, Wal-Mart is making a concerted effort to market to local trade areas.
“It’s pretty ambitious when you think of the logistics, but if anyone can pull it off it’s probably Wal-Mart,” he says, adding that mainstream retailers are still missing marketing opportunities.
Loblaw is also taking note of its customer base, says David Primorac, director of public relations formats. “If we are serving a particular neighbourhood we make sure there is a good concentration of ethnic product in place,” he says. “We have a No Frills in an East Indian community [in Toronto] and you’ll find a concentration of rices and spices in those stores.” President’s Choice also has a number of ethnic offerings.
Leger’s Cho points to Galleria Supermarket in Toronto as another ethnic supermarket that’s making mainstream grocery stores sit up and pay attention. At 45,000 square feet, Galleria targets the Korean market, but with its tea shop, bakery and restaurant, English-speaking staff and tours for English-speaking customers, Cho says it’s attracting up to 40% of customers from outside the Korean community. “It really is a Loblaws focusing on the ethnic community.”
Cho says that while Canadian supermarkets used to think Wal-Mart was their biggest competitor, they are now looking to smaller players like T&T and Galleria. “What used to be a mom and pop ethnic food store now has expanded into something greater and bigger and better,” he says. “T&T has certainly changed the perception of what an ethnic grocery store is. It’s not a cookie-cutter approach, it’s a customized approach.”
Still Not Convinced?
If grocery stores are still waffling about the importance of ethnic offerings and multicultural marketing, these figures should rattle them out of complacency, as ethnic supermarkets like B.C.’s T&T and Toronto’s Galleria carve up market share for ethnic and mainstream shoppers alike.
Of the more than 260,000 immigrants admitted to Canada in 2005, more than 40% came from China, India, the Philippines and Pakistan, according to Citizenship and Immigration (Facts and Figures 2005). These new immigrants settled in Ontario (54%), B.C. (17%) and Quebec (16.5%) and more than half spoke no English or French. According to the 2001 Census, 18% of Canada’s population was foreign born. In that year, 58% of immigrants were Asian, compared to 19% from European countries. Of 5.4 million immigrants, 43% lived in Toronto; 37% in Vancouver and 18% in Montreal.
Looking ahead 10 years, Statistics Canada projects that up to 4.4 million Canadians (about half of all visible minorities) will be of either South Asian or Chinese descent, a jump from 13% in 2001. The fastest growing groups between now and 2017 are expected to be West Asians, Koreans and Arabs with each group more than doubling to 276,000, 203,000 and 423,000, respectively.
Taking StatsCan’s broadest predictions for 2017, one million South Asians-more than half of that entire group’s population-will live in Toronto. In Metro Vancouver, people from visible minorities will more than double to 1.5 million by 2017. Almost half of the visible minority population will be Chinese, followed by South Asians at 22%, Filipinos at 9%, Koreans and West Asians at 4% each, and Southeast Asians at 3%. -EL
T&T’s marketing staples
Promoting everything from Campbell’s Soup to Ching Ping Chicken, T&T’s weekly specials are the mainstay of its marketing strategy. Created in-house, the specials appear in ethnic media and on the chain’s website, and many customers subscribe to receive them by e-mail, says Melina Hung, marketing manager at T&T Supermarkets in Richmond, B.C. The specials are written in Chinese and English, although Chinese is more prominent.
The store also runs promotions around major festivals such as Chinese New Year and the Dragon Boat Festival and advertises on Chinese television, radio and in print.To celebrate the opening of the sixteenth store in downtown Toronto in August, T&T gave out collapsible chopsticks, 10 pounds and 18 pounds of jasmine rice to shoppers who spent $28, $48 and $88 respectively.
Earlier in the year T&T gave out 96 airline tickets worth over $1,000 each to a choice of destinations in Asia as part of a six-week promotion. Throughout the year stores run various food festivals celebrating Asian countries such as Thailand, Japan or South East Asia complete with dancers and other cultural activities. -EL
http://www.marketingmag.ca/magazine/current/multicultural/article.jsp?content=20070924_70205_70205