Albertsons’ 0.8% Sales Dip Is a Strategy Problem

Nearly two years after courts blocked its $24.6 billion merger with Kroger, Albertsons is still fighting for relevance on its own. In its October 13, 2026 earnings release, the grocer reported a 0.8% decline in identical sales and $52 million in quarterly net income. It also announced a comprehensive business review to accelerate a turnaround.

Tactics are not strategy

CEO Susan Morris told investors the company’s goal is “not to be the cheapest grocer in town.” She pointed to a balanced value proposition shaped by local markets, quality, variety, services and convenience. The trouble, as The Blake Project’s Joan Kiddon argues, is that this describes a list of activities, not a reason to choose Albertsons.

Cost reductions, organisational simplification, price investments and digital upgrades may be sensible moves. But they are tactics: the actions that execute a strategy. If the only implicit strategy is to make the business more saleable, and The Wall Street Journal reports Albertsons is examining strategic alternatives including potential transactions, then the brand is being managed toward a deal rather than toward a customer.

A market is a want, not a category

Kiddon’s core point is that Albertsons has not defined its market from the customer’s perspective. A market is people with a want, not a product category, a channel or a geography. There is no single grocery market; there is a market for tonight’s dinner when no one has time to cook, a market for the weekly family stock-up, and a market for hyper-local neighbourhood shopping.

• Market: a specific group of people with a shared want in a shared context.
• Competitive set: the three or four alternatives a customer would actually consider for that occasion.
• Preference: being first choice, not merely being acceptable or satisfying.
• Geography and channel: where and how you deliver the brand, not why customers choose it.

By that logic, Albertsons should stop asking whether it competes with Walmart, Costco, Aldi or Amazon as one undifferentiated set. It should ask which wants it exists to serve better than alternatives, in which contexts, under banners such as Safeway, Vons, Jewel-Osco and ACME.

Preference beats satisfaction

Customers typically consider a short list of acceptable alternatives, often three or four brands. Being on that list makes Albertsons an option. Being preferred makes it the first choice. Satisfaction is necessary but not sufficient; if customers are equally satisfied with two or three grocers, price and convenience decide the trip.

Relevant differentiation matters because customers do not need another retailer claiming freshness, value, convenience, selection and service. Most large grocers already claim those. The question is which combination of benefits Albertsons can deliver credibly and consistently, for a chosen customer, better than the alternatives.

Market-share rankings from Numerator data reported by Supermarket News show Walmart at about 20.3% of food-and-beverage spending, Costco and Kroger at roughly 8.3% each, Albertsons at 4.5% and Publix at 4.1%. Useful industry context, but not a strategy. Share is a result; preference is a cause.

Start with the customer, then choose the tactics

The earnings-call plan may be necessary, but it should fund a more relevant customer experience, not become the brand strategy. Before deciding which stores to close or which prices to change, Albertsons should run a market structure audit: identify growing wants, underserved needs, true competitors by occasion, and where its banners are considered versus preferred.

That work could make Albertsons a stronger acquisition target. It could also reveal that the brand is worth rebuilding. Either way, efficiency cannot answer the question: why should a customer choose Albertsons?

Source: Branding Strategy Insider