For nearly four decades, Phil Markert has been a part of the Vons grocery chain fabric. He began his tenure as a bag boy at a Southern California-based Vons, and his unwavering work ethic propelled him into the company’s executive ranks. Today, Vons is under the Albertsons umbrella, following the 2015 Safeway-Albertsons merger, and Markert is director of liquor for all Vons, Albertsons, and Pavilions locations across Southern California—a grocery empire comprising 354 stores in all.
In that capacity, Markert is leveraging the work he started decades ago by reinforcing the idea that Vons, Albertsons, and Pavilions operate not just as grocery stores, but also as neighborhood-driven beverage alcohol retailers. The upscale Pavilions stores—originally launched in 1985 as a brand extension of Vons—have lent themselves to Markert’s vision of creating a true one-stop shop, where specialty foods, home goods, and other consumer items co-exist with fine wine and spirits. For his ceaseless drive and successful implementation of extensive beverage alcohol programs into Vons, Albertsons, and Pavilions grocery stores across Southern California, Phil Markert has been named a 2019 Market Watch Leader.
Humble Beginnings
When Markert embarked on his Vons career in 1982, he worked as a bag boy in a Torrance, California store. He rose quickly, soon becoming store clerk and then merchandise manager, and relocated to a Santa Monica Vons in 1985. It was there that Markert discovered a new passion: wine. “I stumbled onto wine,” he says. “My father-in-law was an avid collector, and he turned me on to the world of fine dining, wine collecting, and food-and-wine pairing.” He took this burgeoning passion and directed it into his work, though the move toward a full-fledged wine program wouldn’t come until 1988, after a visit to Il Forno in Santa Monica.
At the restaurant, Markert noticed two of his regular customers drinking a wine that had them particularly excited. Intrigued, he spoke with the restaurant owner and learned that the wine in question was the 1985 Groth Reserve Cabernet Sauvignon, a critically acclaimed Napa Valley wine that had received a 95 rating from Wine Spectator, among many other accolades. Soon after, Markert found Groth’s distributor and bought three cases of wine for his Santa Monica store. The customer response was instantaneous. “In 1988, fine wine in a grocery store was about 30 SKUs and two feet of space,” Markert says. “I brought in the Groth, put it at the front of my two-foot wine set, and it sold out in a day.” Seeing the connection between restaurants and retailing, Markert spent the next six months visiting all the restaurants within a two-mile radius of his Santa Monica store, studying copies of their wine lists and ultimately using the information to create a prototype of the fine wine and spirits program that exists across Vons, Albertsons, and Pavilions stores today.
The Vons wine program launched in 1988 with 500 labels. The 2-foot display space was expanded to 40 feet, and the focus shifted toward the luxury end. After introducing the program in Santa Monica, Markert brought it to a Vons in Long Beach, California’s Belmont Shore neighborhood in 1989. By that time, he’d received yet another promotion and was serving as assistant store manager. It was at the Belmont Shore Vons that Markert began organizing winemaker dinners, charity wine tastings, bottle signings, chef demos, and other events. “I became involved in the local community,” he says. “I became invested in specialty food, all with the vision of creating a neighborhood fine wine and food store.”
In 1991, Markert became a store manager at Belmont Shore, in charge of all operations. With this promotion, he hired the first Vons wine steward and also launched a home delivery service. Markert had built his fledgling program into such a shining success that Vons’ leadership instructed him to roll it out in nine additional stores throughout Southern California, from Laguna Beach to Pacific Palisades. “I kicked off more winemaker dinners, hired additional wine stewards, and started mailing lists for all nine locations,” Markert says, adding that he also expanded each store’s assortment based on the restaurants in their respective areas. His dedication to growing the chain’s beverage alcohol program was further rewarded in 1994, when the CEO of Vons created the fine wine neighborhood specialist position specifically for Markert. In his new role, Markert was charged with bringing the wine program to an additional 41 stores across Southern California.
Throughout the remainder of the 1990s, the Vons wine program expanded to include spirits, craft beer, and an amplified assortment of specialty foods meant for pairing. Added to that were in-store tastings and an expanded wine steward team. In 1998, a major corporate change came when the Safeway grocery chain fully absorbed Vons. After the acquisition was complete and Safeway centralized its marketing and merchandise to Southern California, Markert took on the role of national wine director. The new job gave him the most radical assignment yet, as he was directed to roll out his neighborhood fine wine shop-within-a-grocery-store concept across the U.S.
More promotions followed. Markert became Safeway’s vice president of beverage alcohol in 2007, overseeing beer, wine, and spirits for the chain on a national level. He ran the program until 2010, when he took on the role of vice president of merchandising operations for Safeway. In this position, his singular focus on beverage alcohol merged into other categories, and he moved from his longtime home base of Southern California to the northern part of the state. He returned to beverage alcohol and Southern California in 2015, when Albertsons, an Idaho-based grocery chain, acquired Safeway. “I had a handful of different job offers within the company, and I decided to come back to Southern California to finish what I started,” says Markert.
Next Steps
Returning to Southern California as the new director of liquor for all Vons, Albertsons, and Pavilions locations in the region, Markert refreshed the wine steward program, raising the number of stores with wine stewards and incorporating a more rigorous training curriculum for staff. Today, 110 wine stewards—75 of whom are Level One sommeliers—handle a variety of beverage alcohol-related tasks, among them hand-selling and setting up in-store tastings.
Roughly 100 additional stores across Southern California now have expanded wine selections, each customized to its neighborhood. The closer a store is to Santa Barbara, for example, the broader its Central Coast wine selection will be. Markert has also amplified the spirits selection at Vons, Albertsons, and Pavilions, and has added tasting bars and wine cellars to a number of stores. On the personnel side, he’s assembled a team to handle merchandising and special orders, in addition to instituting a concierge program that’s now in 12 Pavilions stores. Concierges at the company are all at least Level One sommeliers, and oversee catering, home delivery, and the wine stewards.
These new additions have brought Markert much closer to his goal of finishing what he started all those years ago. “Through this program, we’ve created a one-stop shop for food, wine, spirits, beer, home goods, and much more,” he says. “We’ve taken our selection up another level by listening to our customers and catering to each neighborhood’s needs, and we’ve dug deeper into fine spirits, taking our high-end wine approach to the spirits sphere.”
Though he’s brought an expanded beverage alcohol experience to all Southern California-based Vons, Albertsons, and Pavilions locations in his purview, Markert notes that the 100 top-performing locations in the company have a core selection that’s even more fine-tuned. On average, these top stores carry around 1,800 wine SKUs—though a broader catalogue of roughly 5,500 wines is available within the company’s system upon customer request—1,000 spirits SKUs, and 900 beer SKUs.
Best-selling wines company-wide currently include Justin Cabernet Sauvignon ($40 a 750-ml.), La Crema Chardonnay ($23), and Kim Crawford Sauvignon Blanc ($20). As is true elsewhere in the market, rosé has bolstered sales—and led to gains for categories like cider, beer, and even spirits. Top-performing rosés include Gérard Bertrand Cote des Roses ($19) and Prophecy Rosé ($15). Rosalie, a rosé beer from local brewery Firestone Walker Brewing Co., is also popular.
Markert notes that canned wine is thriving as well, with such canned offerings as House Wine, Wine By Joe, and Dark Horse driving sales. “We’ve made a big bet on cans in the past year, as new products are debuting on a near-daily basis,” he says. “We’re constantly looking at opportunities where we can lead in innovation or take advantage of trends.” To that end, the company undertakes a full analysis of all its SKUs and resets all 354 stores with a new assortment twice a year.
The company’s own brands also align with national trends. “We regularly bring in own-make brands that are on trend, and we’ll drop them if they’re not selling,” Markert says. “We treat them like a national brand; the only difference is that we have a bit of control over what’s going into the bottle, and it’s exclusive to us.” Private-label brands across Vons, Albertsons, and Pavilions stores are retail priced from $4 a 375-ml. can of Outspoken rosé to $26 a 750-ml. of Signature Reserve Series Chardonnay.
The entire spirits category is on fire, according to Markert. “Spirits are going to lead the industry over the next decade, and whisk(e)y is definitely on trend,” he says. “Tequila, particularly in this market, is also hot right now. Elsewhere, we’re seeing a movement toward low-alcohol, no-alcohol, low-carb, and low-sugar—consumers are health-conscious, and spirits are starting to play into that.” Across all stores, such labels as Ketel One Botanical Peach & Orange Blossom vodka ($29 a 750-ml.) and Prairie Organic vodka ($24) have played into that ethos and been popular with consumers as a result.
The Future Is 2.0
As he’s fine-tuned the wine and spirits program, Markert has also made the upscale Pavilions stores a special point of focus. A great deal of high-end inventory has been shifted to these stores in recent years to further distinguish them as the region’s premier one-stop shops for specialty, upscale products. In 2017, with the launch of what Markert deems “Pavilions 2.0 stores”—those that have been remodeled into a gold standard of grocery—the company created its own wine and spirits club, where customers can sign up and receive email blasts about wine tastings, winemaker dinners, allocated offerings, and a variety of other news.
The updated Pavilions stores carry a more substantial selection than even the company’s 100 core stores, averaging 2,500 wine SKUs, 1,000 spirits SKUs, and 900 beer SKUs per location. Spirits offerings that are geared toward Pavilions stores include The Macallan Rare Cask single malt Scotch ($384 a 750-ml.) and Casa Dragones Joven Tequila ($342), while numerous cult wines and Champagnes are also offered, among them Caymus Vineyards Cabernet Sauvignon ($127) and vintage Dom Pérignon Champagne. “We’ve differentiated Pavilions from Albertsons and Vons not only through the enhancement of the liquor department, but also of all of the other departments—customers will see a much greater selection of organic, natural products, improved floral selections, and more,” Markert says. He notes, however, that neighborhoods and demographics are still the ultimate deciding factors for any given store’s selection, resulting in Albertsons locations that carry upscale wine and spirits assortments rivaling that of a Vons or Pavilions.
The company is currently in the process of remodeling all its Pavilions locations into Pavilion 2.0 storefronts; as of August 2019, 11 of the 26 locations had undergone renovations, with many more set to follow over the next three years. New stores will also join the crop of remodeled locations, as the umbrella company looks to build its upscale fleet.
Since his bag boy days, Markert has valued the concept of a grocery store and the impact it has on its local neighborhood. Moving forward, he sees plenty of room for the growth in his program, and is optimistic about the future. “The biggest advantage we have over an independent fine wine and spirits shop is that we also have seafood, we have a floral program, we have local beef and poultry, and we have one of the largest cheese selections in southern California, with 26 cheese specialists on staff,” he says. “We train our staff in the art of hand-selling and guest engagement. You can’t get all of these factors together in a typical independent wine and spirits retailer.”