While the company is approaching its 80th anniversary and still owned by the five families that founded the operation in 1931, Giant Eagle Inc. is anything but stodgy.

The privately held Pittsburgh-based chain with estimated annual revenues of more than $6 billion is leveraging a vibrant merchandising strategy that is keeping pace with—and in some instances moving ahead of—fast-evolving consumer purchasing and lifestyle trends.

Initiatives include an emphasis on the in-store development of high-quality prepared and value-added meals and convenience foods; the marketing of expansive arrays of meats and cheeses; the launch of health-oriented proteins; and enhancements to an already prominent private-label program.

Many of the products, meanwhile, are being sold in a variety of store formats. In addition to 217 conventional Giant Eagle banner outlets in Pennsylvania, Ohio, West Virginia and Maryland, the company also operates two Market District locations and a smaller Giant Eagle Express store.

Market District merchandises expanded lines of fresh prepared, grab-and-go and specialty proteins, and also features a Kosher deli and a charcuterie containing high-end dried-cured meats.

TNS Retail Forward, a Columbus, Ohio-based management consulting, market research and executive development firm, rates Market District as a “best-in-class fresh format operated by a conventional supermarket chain.”

“The concept is well-suited to serve busy urban communities as well as affluent suburbia,” TNS notes, adding that it “was especially impressed by Market District’s sophisticated format that combines upscale/gourmet and fresh market appeals.”

“Expect successful store features and initiatives to be incorporated into more conventional Giant Eagle supermarkets, both new and remodeled,” TNS states.

Fresh proteins and prepared meals also are being marketed at the Giant Eagle Express in Pittsburgh, and at 148 company-operated GetGo fuel stations and convenience stores.

For its ambitious and forward-thinking merchandising initiatives, Giant Eagle Inc. is Meat & Deli Retailer’s 2008 Retailer of the Year.

Tom DeVries, vice president of prepared foods, notes that much of the activity is part of Giant Eagle’s focus on enticing more customers to get their meals from its stores instead of take-out restaurants.

Delis, for instance, are merchandising wider varieties of hot and cold fully cooked meals. Among the elements in many outlets are grab-and-go entrées and side dishes; pizza, sandwich and sushi stations; hot cases with 52-ounce rotisserie chickens; and self-service bars for salads, olives and antipasti, and hot foods.

Recent enhancements include upgrades to the salad bar, including a move to offer only freshly sliced fruit and lettuce.

That initiative contributed to a doubling of salad bar sales in some locations, DeVries states.

Giant Eagle also is accentuating freshness by developing meals in in-store kitchens.

About three-dozen locations, for instance, have chefs creating the prepared meals that are sold at full-service counters, grab-and-go sections and hot buffets.

More than a dozen chefs work in the chain’s central kitchen at a Market District outlet in Bethel Park, Pa. The associates prepare foods for Market District and other Giant Eagle outlets.

Newer and remodeled Giant Eagle locations typically employ between one and six chefs, based on volume.

Most stores merchandise between 20 and 50 prepared foods at full-service counters in accordance with space limitations, DeVries notes.

Nineteen types of salads are behind the glass at the Bethel Park Market District. Selections include Wheatberry with Pecans, Sweet Potato, Roasted Beet, Crab & Shrimp, Broccoli with Bacon, Crunchy Tuna and Lemon Almond Chicken.

Among the entrées are Roast Filet of Beef, Florentine Lasagna, Smoked Salmon with Apple-Jalapeno Glaze, Chipotle Honey Chicken Breast and Lemon Garlic Chicken.

Also available are such side dishes as Green Beans with Toasted Walnuts, Cranberries & Gorgonzola, Spinach Artichoke Dip, Green Beans with Sauteed Mushrooms, Onions & Roasted Garlic and Potato Latkes.

DeVries says chefs base their recipes on restaurant and health and wellness trends, and the popularity of foods being sold in the center store and frozen areas.

“We marry external observations and internal data and develop a list of products that represent gap opportunities in our menu,” he notes.

To ensure quality, eight to 10 “foodie panel” members also sample prospective items, he says.

“Foodie panels” consist of individuals from all levels of the company who have a passion for specific foods and analyze those selections prior to launch.

While many choices are rotated seasonally, a core group of prepared foods are available throughout the year, including Rotisserie Chicken, Boneless Turkey Breast and Mashed Potatoes & Gravy.

“We expect stores to offer a certain amount of traditional center of the plate proteins and sides, but some variations are allowed based on market demand,” DeVries states.

Such measures, along with product improvements and additional varieties, have made prepared foods one of Giant Eagle’s top revenue-producing perishables departments, DeVries notes.

Newer prepared foods initiatives include the May 2007 launch of chilled, ready-to-eat meals in microwavable packaging.

Available in 15 stores, items include entrées in 11-ounce to 22-ounce containers that are priced at $4.99, $5.99 and $8.99.

Varieties include Chicken Marsala, Eggplant Parmigiana, Beef Meatloaf & Potatoes, Angel Hair Pasta with Four Cheeses, St. Louis BBQ Chicken, Grilled Chicken Alfredo, Grilled Chicken Burritos with Ancho Salsa, Chicken Marsala with Roasted Potatoes, Stuffed Lasagna Florentine, Grilled Lemon Garlic Chicken with Rice Pilaf, Meat Lasagna, Coconut Tilapia and Wild Mushroom Risotto.

Among the side dishes, which are marketed in six-ounce to 10-ounce containers and sell for $2.49 or $3.99, are Baked Beans, Carrot Souffle, Twice Baked Potatoes and Potato Pancakes.

The products will be available in all outlets following the scheduled completion next year of a 70,000-square-foot manufacturing plant, DeVries says.

“Chilled meals is a key growth vehicle for us and can be as big as our entire prepared foods business is today,” he states.

Giant Eagle, he adds, also is looking to expand prepared foods sales by spotlighting quality instead of price.

“We’re determining how to make items taste better—not how to make them cheaper,” DeVries states. “Value does not equate to the least expensive. Food needs to be affordable, but it also must be the best.”

That focus on quality also extends to the self-service bars. Hot buffets are currently in six locations, and will be added to additional outlets as the stores are remodeled, he notes.

Priced at $7 a pound, selections include American, Indian and Latin cuisines.

Among the items are Beef Burritos, Vegetable Curry, Moroccan Chicken Stew, Pasta with Sausage, Fried Chicken, Jasmine Rice and Beef Vindalo.

A 56-item salad and fruit bar also is positioned as an important deli magnet.

“Self-service is emphasized because shoppers are seeking convenience and it requires less investment (in labor),” DeVries says. “Customers also want to customize their meals and to purchase specific quantities. Both the salad and hot bars respond to that demand.”

Moving forward, Giant Eagle plans to “more aggressively” stress convenience and wellness by offering meal bundles and meal deals, and to market additional health-oriented prepared foods, he states.

“More people want to know what they are consuming and where it came from,” DeVries adds.

That interest extends to the packaged meats and cheeses and the wide range of bulk items at the full-service deli counter.

Dietz & Watson and Giant Eagle are the predominant bulk meat brands, but outlets also market additional brands from national and local suppliers, including Russer, Eckrich, Lean Generation, Honeysuckle White, Citterio, DiLusso and Hatfield.

Among the major cheese brands are Alpine Lace, Finlandia, Lorraine, Jarlsberg, Hoffman, Emmi, BelGioioso and Land O’ Lakes.

Voni Woods, senior director of deli, says extensive customer research enables the company to identify the optimal offerings for each location.

While about 87 percent of deli products are identical in each outlet, most other items vary in accordance with the demographics of shoppers in the neighborhoods served by the stores.

Deli managers often make recommendations based on local activity and the popularity of items at competing stores.

In addition, consumers in many instances call an 800 number to request particular products and brands.

“You can’t be all things to all people, but it is important to sell certain products in the different markets,” Woods says.

The greatest merchandising emphasis, however, is on proprietary items.

All outlets carry large arrays of Giant Eagle-branded proteins, and Market District-branded selections also are being rolled out to more locations. Woods notes that 57 percent of items in the full-service and grab-and-go deli carry the store brand.

“My main focus is to be famous for the Giant Eagle brand,” she says. “We carry other supplier brands to be sensitive to the interest by consumers. It shows you are part of the community. But we have a support team for our brand.”

That team includes “foodie panel” members and Giant Eagle managers who visit plants to study production methods and product ingredients.

“We have standards for what we are willing to put our name on,” Wood states.

Giant Eagle also is working to make packaged meats and cheeses more appealing by transitioning from vacuum to modified atmosphere packaging (MAP).

Meats already available in a MAP format include 15 SKUs of Dietz & Watson proteins, nine SKUs of Giant Eagle and four SKUs of Lean Generation-branded products.

Woods says the flavors of MAP proteins more closely resemble the fresh items being sold at full-service deli counters.

Cheese slices in modified atmosphere packages also are easier to peel apart and do not have an offensive odor, she adds.

Another important deli differentiator is Giant Eagle’s large arrays of imported, specialty and gourmet cheeses, Wood states.

Thirty-four outlets have full-service cheese counters and market about 400 items, while the majority of stores carry about 150 selections.

The counters are operated by certified “Cheesemongers,” or employees who have undergone 16 hours of cheese training. The individuals wear berets with a “Cheesemonger” logo.

Similar counters will be added to appropriate locations during remodeling, Woods says.

“Anyone can put 400 pieces of cheese on shelves, but can they tell stories, and build enticing displays and make you feel like you’re in a ‘cheese world’ rather than just a department of the deli?” she states. “We don’t put the displays in to just look pretty. You have to also turn the product and make sure you’re selling the freshest foods.”

Woods and her staffers research potential offerings during their international and domestic travels, she notes.

Other major activities include the merchandising of items that meet the dietary needs of consumers—such as gluten-free and low-sodium proteins—and offering new selections in response to shoppers’ growing passion for different and exciting foods, Woods says.

“We want people to slow down and look at all the deli varieties instead of racing through the aisle,” she notes.

Such emphasis on diversity, quality and convenience also extends to the meat department, where stores are merchandising large arrays of value-added proteins at full-service counters.

Selections, which are prepared in the outlets, include 12 types of seasoned burgers, such as Bacon Cheddar, Blue Cheese, Pepperoni, Greek Gyro, French Onion, Jalapeno, BBQ, Italian, Pepper Garlic, Black Nugget, Steak Burger and Garden Vegetable Turkey Burger.

Also available is Burgundy Beef, Teriyaki Chicken, Stuffed Bell Peppers, Meatloaf, Meatballs, Stuffed Beef Round Florentine Medallions, Butter, Garlic & Onion Chicken, Lemon Pepper Chicken, Stuffed Beef Flank Pinwheel Steak, Stuffed Bone-In Pork Loin Chops, Parmesan Breaded Pork Chops, Chicken Cordon Bleu and Stuffed Boneless Chicken Breast.

There also is a range of Kabobs, including different varieties of Sausage, Lamb, Chicken, Beef and Pork.

Giant Eagle’s proprietary Nature’s Basket line of natural meats also is evolving. The program includes nine varieties of chicken, four primal cuts of pork and a range of USDA Choice beef that was developed without the use of antibiotics and hormones, including 80-percent and 90-percent lean grinds.

“We’re expanding the category because customers are demanding it,” says Ed Steinmetz, vice president of meat and seafood.

While most stores have a central Nature’s Basket display in the meat department, Giant Eagle recently began testing the integration of Nature’s Basket items within the different protein sections of the self-service case.

“The first objective was to introduce Nature’s Basket (which was launched in April 2006) in a big way,” he states. “Now we’re trying to reach those consumers who still might not be familiar with the brand when they visit the commodity section.”

Steinmetz says the “never-ever” use of antibiotics and growth hormones enables Giant Eagle to stand out from the growing list of retailers launching private-label natural meats.

“We’re trying to hold Nature’s Basket to a higher standard than the USDA definition of natural, which is just minimally processed, ” he states. “Most items in the meat case already fit that description.”

Also distinctive is the large amount of premium, store-cut meats being sold at full-service counters, including USDA Prime Certified Angus Beef.

A Giant Eagle outlet in Seven Fields, Pa., for instance, merchandises about 70 selections behind the glass.

“A well-represented service counter creates a halo effect for the entire meat department,” Steinmetz states. “It says something about your commitment to freshness and quality.”

While stores also merchandise such brands as Perdue, Honeysuckle White, Smithfield, Hillshire Farm, Sommers Organic and Coleman Natural, the primary focus is on Giant Eagle meats, he says.

“It is not the typical private-label brand that is associated with a cheaper price,” Steinmetz notes. “We’re interested in store products that are better than the national brands, which helps to differentiate us and often are more profitable.”

Though such profits are harder to come by in the current economic climate, Steinmetz says the environment still is creating growth opportunities for Giant Eagle.

Many consumers who are dining out less to cut expenses still seek convenient prepared foods, he notes.

“People may be willing to give up sit-down restaurants, but they still want the convenience of having meals that are ready to cook or fully prepared,” Steinmetz states. “Offering value-added items is a great way to take advantage of the fact that shoppers still are as busy as they have ever been.” MDR