An Interview With EVP of Merchandising Tony MontiniSince joining Rite Aid in February 2010, Tony Montini’s “Speed Wins” philosophy and commitment to fact-driven decisions have led the way for Rite Aid to improve front-end sales results. Rite Aid recently promoted Montini from Senior Vice President of Category Management to Executive Vice President of Merchandising. @Rite Aid recently interviewed Montini to discuss changes he has made to category management, consumers’ on-going search for value and the evolution of Rite Aid’s new Wellness store format.
People who know you well know that one of your favorite sayings is “Speed Wins.” Have you seen improvement in this area since coming to Rite Aid 18 months ago?
I really have. I think it’s a cultural change we needed to make and we’re getting there. In the past, we’d get stuck and be slow to make decisions, maybe because we were over-analyzing and had “analysis paralysis” so to speak. “Speed Wins” is all about making quicker decisions, but also making decisions that are grounded in facts and data-driven. I think we have an opportunity to be quicker than we are now, but we certainly have improved in the last 18 months.
Our supplier partners have also bought into this concept. They are moving more quickly and they know that I expect answers from my team much more quickly than before.
In an interview with @Rite Aid last April, you said the number one priority was to increase top-line sales. We’ve seen front-end same-store sales increase in seven out of the last nine months. What have been the keys from a category management and merchandising perspective?
Well I think there are a couple of things. Number one, we’ve gotten more aggressive and intelligent in terms of the items we promote and how we promote them. Two, we’re utilizing data that tell us what the consumer wants rather than attempting to push items that we think they want. Our mixes are better, our in-stock conditions have improved and we’ve cleaned up our in-store presentations too. So I don’t think it’s any one thing. We’ve touched many facets of our business in small ways and all of it has added up into something positive and worthwhile.
Also last April, you told us that offering more value to customers would be an area of focus. How has Rite Aid been able to deliver value since then?
The economy has not dramatically improved, so shoppers continue to look for value and our number one means of value is wellness+. With wellness+, not only do customers benefit from values like everyday low pricing, promotional pricing and Rite Aid Brand, but we take it a step further with +UP Rewards and the 10 or 20 percent discount we offer gold and silver members. So wellness+ represents value on top off value, and consumers are really responding to that. Our supplier partners have played a key role because they help us fund +UP Rewards that can be applied directly against their products.
What are your views on Rite Aid’s seasonal business?
I think we’ve been a little complacent with our seasonal business. Seasonal programs are really about excitement…what’s new, what’s hot and what’s trendy…and also being able to sprinkle in some existing items that are staples from year to year. But there has to be an element of excitement that has people saying, “I have to visit Rite Aid and see what they have.” Our new Vice President of Seasonal, Gardening and General Merchandise Ted Williams has taken that challenge and with folks like Category Managers Steve Koch and Steve Moss, I think they’re excited about the direction we’re moving in.
I can say the same for Bill Renz’s side of the business, which involves Category Managers such as Val Stansfield (candy) and Brian Shanahan (grocery). I think that we’re really beginning to make some advancements, and I would hope that by the Christmas selling season that we’ll really see a difference in our seasonal program.
Rite Aid currently has 40 stores in its new Wellness format, with plans to expand the concept to hundreds more stores this year. How is the merchandising and presentation of these stores different from our typical stores?
The merchandising and presentation give these stores more of an open feel. They don’t feel cluttered. From the minute you walk in, there’s a direct sight line to the pharmacy, which is the focal point because that’s the core of what we are: a retail pharmacy. Within that framework, we offer wellness items such as organic foods and gluten-free foods that we didn’t offer before. We’ve done some things with beauty and grooming that are unique and different, like the separate “Him” and “Her” sections. So we’ve improved the product mix, the presentation and the overall “shop-ability” of the store. We’ve received strong positive comments from customers.
These stores will continue to evolve, so I want our supplier partners to know that we’re open to suggestions for innovation. We’re being a bit more aggressive with this format in terms of trying new things and identifying exactly what is resonating with the consumer. So as we keep walking down this path, the next store will probably look a little different than the one before. It truly is an evolution.
Anything you’d like to say to our supplier partners who are reading this?
Thanks for your continued support. I’m looking forward to a very strong year together.