Interformat competition in the grocery retailing

• Competition between store formats (interformat) is becoming more intense than the competition within store formats (intraformat).
• The different store formats are no longer distinguished by their capacity to meet specific shopping needs.
• Not all retail levers contribute in the same way to the convergence: range and time saving services appear to be most influential.
• Consumers perceive that different store formats are becoming increasingly similar in meeting shopping needs.
• Convergence between store formats affects consumers’ decision-making on purchasing.

In the last few years, we have seen significant changes in the Italian retail environment which suggest that the patterns of retailing competition are more complex than in the past. In order to expand their target market in a context of economic recession, retailers are implementing new strategies aimed to stimulate the switching between different store formats. As a result, store formats are getting similar and new "hybrid" formats are emerging.This paper investigates the interformat competition between grocery store formats in the Italian retail market in order to understand which formats are converging and which, otherwise, are maintaining their distinctiveness. Our findings show that the rivalry between store formats (interformat) is becoming more intense than the competition within store formats (intraformat). These results have significant implication on both retailers and trade marketing strategies.