Publix attempts to seduce cultured customers

In an attempt to increase market share, Publix Super Markets has partnered with OSI Restaurant-owned Carrabba's Italian Grill. The 1,000 sq-ft version of the popular Italian eatery inside a Sarasota Publix operates as a stand-alone restaurant. The grocer will receive a monthly fee based on Carrabba's sales.

In an industry now dominated by value-priced retail stores such as Wal-Mart superstores, major national grocers such as Kroger and Giant Eagle are testing concepts from carwashes to beauty treatments. Florida's largest grocery chain is no exception.

It's not unheard of for grocers and restaurants to team up, but a casual dining place like Carrabba's aims above the quick-serve places more likely to build inside a grocery store. It offers a smaller menu geared toward carry-out dining, and seating is limited to seven bar stools. Carrabba's signature pizzas and all the dishes are prepared in the tiny kitchen nestled between the deli and floral departments. Panini sandwiches and smaller portions of dishes such as lasagna were priced to appeal more to the lunch and carry-out crowd.

For the past several years, Publix has dominated the Tampa Bay area's grocery landscape with a nearly 40% share. Publix doesn't assume it will keep its market share and always looks for ways to grow. In recent years, Publix has begun offering walk-in medical clinics, offering common pediatric antibiotic prescriptions for free, digital kiosks, liquor stores, gas stations, the company's Greenwise line of natural and organic products, and now casual dining.

"It all goes back to what the customer desires," Publix spokeswoman Shannon Patten. “Most of the concepts are aimed at adding revenue to the company's bottom line. We always want to grow our customer base." However, testing doesn't commit Publix to adding the concept at its 900-plus stores.

If Carrabba's doesn't succeed, they might try something else. Pilot programs allow the company to see how, where and when new ideas can boost sales, Patten said. They can afford to do it and not lose market share. In 2006, Publix's revenue was a record US$21.8 billion - an 11% increase from the year before.