SWOT Analysis Strength Vs. Weakness Opportunities Vs. Threats SWOT AnalysisStrengths Modified atmospheric packaging, longer shelf life Efficient distribution Strong core products Weaknesses Online presence Privately owned Small work force Opportunities CFI is kosher certified Par-baked products SponsorshipsThreats Private label increase Larger competition Government restrictions Long-term healthy trend No fan base or following on Social Media Facebook had 896 likes in total Twitter had thirteen tweets and four followers Government regulation and taxes on ingredients like sugar Strong core products - convenience stores sell a lot of baked goods like Small work force - 450 employees which is low compared to other leading competitors Private label 15.3% - 17.4% (7-eleven and grocery stores) Tiffany Hannoun () - "...our product portfolio has most of the core items that are ranked in the tope ten in sales for convenience stores." 108 BAB1012C This case was prepared by Krista Hill, Assistant Professor of Management at Bridgewater State College, Anne Roggeveen, Professor of Marketing at Babson College, Dhruv Grewal, Professor of Marketing at Babson College, and Jens Nordfält, Assistant Professor of Marketing, Stockholm School of Economics. It was developed as a basis for class discussion rather than to illustrate effective or ineffective handling of an administrative situation. It is not intended to serve as an endorsement, source of primary data or illustration of effective or ineffective management. Copyright © 2014 Babson College and licensed for publication to Harvard Business School Publishing. All rights reserved. No part of this publication can be reproduced, stored or transmitted in any form or by any means without prior written permission of Babson College. 1 Babson Worldwide BAB274 DECEMBER 2014 ICA: Changing the Supermarket Business, One Screen at a Time At the end of 2007, after several rounds of testing the effectiveness of its brand new digital signage initiative, the ICA Group needed to decide whether it should install monitors throughout all its many stores. The tests had been designed with the goal of providing a clear answer about whether this initiative was worthwhile, yet the results revealed conflicting information. Customers reported not enjoying their shopping experience as much with digital signs in place, yet sales data suggested they had bought more than when digital signs were not present. Managers were torn: Should they invest the money to install digital signs in all their stores? The ICA Group As a large, profitable retail group, ICA ran approximately 2,400 of its own and retailer- owned stores in Sweden, Norway, and the Baltic region. The group comprised ICA Sweden, ICA Norway, and Rimi Baltic. It also included ICA Bank, which offered financial services to clients of its retail stores, and ICA Real ...

1. SWOT Analysis
Strength Vs. Weakness
Opportunities Vs. Threats
SWOT AnalysisStrengths
Modified atmospheric packaging, longer shelf life
Efficient distribution
Strong core products Weaknesses
Online presence
Privately owned
Small work force
Opportunities
CFI is kosher certified
Par-baked products
SponsorshipsThreats
Private label increase
Larger competition
Government restrictions
Long-term healthy trend

2. No fan base or following on Social Media
Facebook had 896 likes in total
Twitter had thirteen tweets and four followers
Government regulation and taxes on ingredients like sugar
Strong core products - convenience stores sell a lot of baked
goods like
Small work force - 450 employees which is low compared to
other leading competitors
Private label 15.3% - 17.4% (7-eleven and grocery stores)
Tiffany Hannoun () - "...our product portfolio has most of the
core items that are ranked in the tope ten in sales for
convenience stores." 108
BAB1012C
This case was prepared by Krista Hill, Assistant Professor of
Management at Bridgewater State College,
Anne Roggeveen, Professor of Marketing at Babson College,
Dhruv Grewal, Professor of Marketing at Babson College,
and Jens Nordfält, Assistant Professor of Marketing, Stockholm
School of Economics. It was developed as a basis for
class discussion rather than to illustrate effective or ineffective
handling of an administrative situation. It is not
intended to serve as an endorsement, source of primary data or
illustration of effective or ineffective management.
Copyright © 2014 Babson College and licensed for publication
to Harvard Business School Publishing. All rights
reserved. No part of this publication can be reproduced, stored

3. or transmitted in any form or by any means
without prior written permission of Babson College.
1
Babson Worldwide
BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business,
One Screen at a Time
At the end of 2007, after several rounds of testing the
effectiveness of its brand new
digital signage initiative, the ICA Group needed to decide
whether it should install monitors
throughout all its many stores. The tests had been designed with
the goal of providing a clear
answer about whether this initiative was worthwhile, yet the
results revealed conflicting
information. Customers reported not enjoying their shopping
experience as much with digital
signs in place, yet sales data suggested they had bought more
than when digital signs were not
present. Managers were torn: Should they invest the money to
install digital signs in all their
stores?

4. The ICA Group
As a large, profitable retail group, ICA ran approximately 2,400
of its own and retailer-
owned stores in Sweden, Norway, and the Baltic region. The
group comprised ICA Sweden, ICA
Norway, and Rimi Baltic. It also included ICA Bank, which
offered financial services to clients of
its retail stores, and ICA Real Estate, which provided the
company with properties on which to
build retail stores. Prior to 2013, Royal Ahold N.V. and Hakon
Invest AB owned the group; but
in March 2013, Hakon Invest AB bought all the shares and
changed the name to ICA Group.
Consolidated 2012 net sales reached SEK 96,863 million.
According to CEO Per Strömberg in
the Annual Report and Sustainability Report 2012,1 the year
2012 …
1
http://reports.ica.se/ar2012en/Materiale/Files/ICA+annual+repo
rt+and+sustainability+report+2012_opt.pdf
accessed November 2014.
For the exclusive use of N. Bardawil, 2017.
This document is authorized for use only by Natalia Bardawil in
Marketing Management taught by Kristin Houser, HE OTHER
from August 2017 to December 2017.

5. BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
2
…was another successful year for ICA, despite the economic
concerns in the market. ICA
Sweden continued to outperform the market as a whole. We saw
fine performances by
our private labels, Cura pharmacies and ICA non-foods. Rimi
Baltic developed well, as
did ICA Bank, which launched an interesting new package of
mutual funds. ICA Real
Estate was stable and generated satisfactory operating income
for the year. Another
achievement is that our Swedish sourcing and logistics
processes are now certified
according to quality and environmental standards.
ICA operated multiple store formats in Sweden: (1) ICA Nära, a
convenience-type store
meeting consumers’ daily retail needs; (2) ICA Supermarkets,
mid-sized stores typically located
in cities and carrying a wide range of products; (3) ICA
Kvantum superstores, usually located
outside of cities and supporting large, planned purchases; and
(4) MAXI ICA hypermarkets with
full product ranges including groceries, clothing, and
housewares. Recently the group had added

6. Cura pharmacies and ICA-to-go. Cura pharmacies were located
within larger ICA stores, and
ICA-to-go sold nutritious, portable meals. Independent retailers
owned and managed many
stores, though all had entered into agreements with ICA Group
to receive support in areas such
as logistics, retail development, and marketing communications.
The grocery market in Sweden was substantial, worth several
hundred billion SEK. It
was served by various competitors of ICA, including Axfood,
Coop, and Bergendahls. However,
ICA stores dominated the market, holding a 36.7% share. Strong
competition existed in other
channels in Sweden including home delivery services and
restaurants. Growth opportunities
were notable. Urbanization in Sweden had occurred faster than
in any other European country.2
Prominent market trends included an interest in health,
environmental awareness, and a focus
on convenience. Because Swedes spent approximately 12% of
disposable income on food, they
were generally price-sensitive and readily checked food prices
on their mobile devices or
computers.
To function in such a market environment, the ICA Group relied
on extensive research to
explore and test the effectiveness of new ideas and strategies. In
its long-standing relationship
with the Center for Retailing at the Stockholm School of
Economics, the ICA Group continually

7. tested new retailing ideas by using large-scale quasi-
experiments. As one researcher from the
Stockholm School of Economics noted, unlike in many
traditional retail firms that depended on
store managers to communicate information up the hierarchy, at
ICA, research “plays a major
role, greater than many know or think about…. They want to
make this [process] theoretical and
get theory.” Fredrik Holmvik, ICA’s media manager, agreed
with this assessment, explaining
that “Basically all new ideas we try to test and analyze before
the launch/no launch decision.
Research is the foundation for more extensive tests or gives us
the toolbox for simpler tests…. It
also gives us new angles/ideas to test.” 3
In 2005, when increasing competition and a sluggish market
resulted in a 2.3% decrease
in net sales, the Group sought new ideas to boost sales. Digital
signage— in-store video screens
that displayed pertinent content—was just beginning to gain
traction with retailers. Kalle Fahlin,
head of media development, suggested the Group consider using
digital signage, arguing that
ICA TV could broadcast promotions or other in-store
information to shoppers. This practice
2 Magnusson, Erik (2012), “The fastest urbanization in
Europe,” Sydsvenska Dagbladet, April 8 2012.
3 July 3, 2013
For the exclusive use of N. Bardawil, 2017.

8. This document is authorized for use only by Natalia Bardawil in
Marketing Management taught by Kristin Houser, HE OTHER
from August 2017 to December 2017.
BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
3
would enhance the in-store environment and help stores promote
certain products. (See
Exhibit 1.) Although the idea of digital signage was not totally
new, it was innovative to ICA
and its franchisees. According to Holmvik, “Many liked the idea
of communicating with ‘the
shopper’ in-store versus ‘the consumer’ at home; the response
was positive from that angle. But
then we had people wondering if it would work or not.”
Specifically, might the signage
overwhelm or overstimulate shoppers?
Digital Signage
The digital signage industry, part of the broader billboard and
sign manufacturing
industry (in which revenues were an estimated $12.8 billion in
2012), grew notably in the early

9. 2000s, mainly due to increasing demand for non-traditional
means of communication in
response to the growing presence of online retailers. Overall,
the digital signage industry was
fragmented with small businesses functioning in regional niche
markets. However, several firms
held significant influence within the industry, including
Daktronics (with the largest market
share at 3.8%), Young Electric Sign Company, Brady
Corporation, Clear Channel Outdoor
Holdings, and Lamar Advertising Company. These providers
typically targeted key businesses in
industries such as gas stations and convenience stores,
department stores, billboard and
outdoor advertising, fast-food restaurants, and coffee/snack
shops.
Instead of traditional vinyl or plastic sheets, digital signage
used high-resolution, digital
video screens or LEDs, in sizes ranging from small screens (.5
-around (quarter-
arena displays. Signs combined
high-tech software and hardware, including screens, servers,
routers, transponders, mounting
equipment, wiring, and antennas. Displays could be controlled
by PCs/servers, so software
represented a relatively minimal capital expenditure.
To create value for customers, digital signage promised to
improve the shopping

10. experience. For advertisers, it offered an additional source of
revenue; and for stores, its
purpose varied with the type of store. Clothing stores might use
music videos to enhance their
environments; big box stores might present how-to videos to
provoke interest in a new product;
restaurants might use digital signs to display a menu; and
service providers (e.g., corporate
buildings, universities) might adopt digital signs for
information displays. In addition, digital
sign content could be classified into three types: active, passive,
or interactive. Active content
engaged onlookers directly and called them to action, with the
goal of creating interested,
informed consumers. Passive content remained part of the
background scene, designed to
enhance the atmosphere and possibly draw customers into
stores. Finally, interactive content
combined these forms by offering interactive features while
simultaneously displaying
background imagery or video.
Across these various purposes and types, digital signage offered
consistent advantages
over traditional analog signs. It enabled quick turnover and
distribution of content, and it
allowed varying content (e.g., promotions, entertainment, news,
product advertisements) to be
displayed in the same space. Profit potential increased with
digital signage, because a store
could send multiple advertising messages in the same space, cut
back on printing costs, and set
individual-level time and location targets to specific audiences
at any moment.

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Marketing Management taught by Kristin Houser, HE OTHER
from August 2017 to December 2017.
BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
4
Researching and Evaluating ICA TV
In line with its tradition of researching every new idea before
implementing it, ICA
conducted three rounds of testing in 2006 and 2007 to determine
the in-store efficacy of digital
signage, which it designated “ICA TV.” The first series of
experiments examined the main effects
of digital displays on customer attention, emotions, attitudes,
and behavior in large stores. The
second round replicated the first but in smaller stores. As one
researcher explained:
We used a Latin square design in all three experiments to rule
out calendar effects, and

12. to rule out that a certain effect only held for a specific store.
This means that we had
some experimental stores and some control stores in one period
and then switched them,
so that the experimental stores became control stores and vice
versa in a second period.
Of course we did not dismount any TV screens, but just turned
them off when the store
was used as a control store.
Most comparisons therefore referred to experimental stores
(i.e., screen “on” stores) versus
control stores (i.e., screen “off” stores).
Test 1
The first round of testing, undertaken in Maxi and Kvantum
stores, sought to answer
several questions, including whether customers noticed the
displays and liked them, and
whether customers believed they experienced more positive
shopping experiences as a result.
Some group members feared the screens might distract or scare
customers away. Thus, another
important question of interest was whether customers were more
likely to purchase a product
located near a digital display.
In each store, approximately fifty 42-inch digital signs were
installed in six zones. (See

13. Exhibit 2.) Different content was developed for each zone. To
monitor customer responses, the
ICA Group placed researchers throughout the stores and also
relied on cameras and sensors to
measure whether customers approached or avoided digital
displays. Self-scanning devices held
by customers themselves logged the time they spent in the store,
the time spent at checkout, and
their average spending. Furthermore, researchers conducted
approximately 2,500 interviews
with customers to ask them about their experiences and how
long they believed they waited in
the checkout line. The behavior of almost 34,000 customers was
analyzed in terms of average
time and money spent in stores. This information was calculated
from data gathered by the
handheld devices customers carried and used to scan products as
they placed them in shopping
carts. Approximately 12,000 in-store observations came from
researchers who noted whether
shoppers viewed the end-of-aisle displays that were
complemented by digital signage, stopped at
them, or purchased from them. Finally, nearly 60,000
mechanical observations using cameras
as sensors were obtained showing customer behavior as they
approached digital displays.
For the basic question whether customers noticed the digital
displays, the results
revealed that screens were noticed: 35% of customers reported
seeing a digital sign in at least
one of the zones. The visibility rates were higher in Kvantum
stores and at checkout. (See
Exhibit 3.)

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BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
5
Next, to examine whether customers approached or avoided the
digital displays, the
experiment featured a long table holding bananas, with two
smaller screens behind it. One
screen was always on, and the other was always off. The screens
were counterbalanced so that if
a screen was on one day, it was off the next, and vice versa.
These results showed that customers
tended to shop closer to the on screen than to the off screen.
Specifically, a lead researcher
recognized, “Even when the screen closest to the perimeter was
turned off, a significant number
of customers walked by it to pick bananas closer to the screen
that was turned on.”

15. For retailers, a more important question was whether sales
would improve if they
supplemented end-cap displays with digital displays. To the
delight of ICA, when end-of-aisle
displays were accompanied by a digital sign, sales increased
significantly for 17 product
categories across manufacturer brands and private labels.
Researchers also discovered a sales
increase for items on an end cap positioned just beyond one
featuring a digital sign when the
second end cap contained a related product.
Once shoppers reached the checkout line, their average
perceived waiting time was two
minutes and 15 seconds; their actual average waiting time was
only one minute and 45 seconds.
That is, customers believed they waited longer than they
actually did, regardless of whether they
shopped in a store with digital signage. However, for customers
who indicated they liked digital
signage, its presence decreased their perception of waiting time.
Furthermore, regardless of
perceived waiting time, average spending on products in the
checkout area increased by more
than 50% when screens were turned on. The final and most
staggering result was the large
increase in average time and money spent in stores. An average
shopping trip without TV
screens lasted approximately 30 minutes. Shopping time
expanded by 10% when screens were
turned on. The same was true for the average amount of money
spent. From a baseline of
approximately U.S. $70 per customer, average spending

16. increased slightly more than 10%.
Despite these extremely positive effects of digital displays on
sales and customer
behavior, the effects on customer attitudes and emotions
suggested different outcomes.
Curiously, customers indicated their experience seemed more
negative than usual, reporting
they had less interest in returning to the store, approaching
sales staff, or exploring the store, in
contrast to customers in the control stores without digital
displays. (See Exhibit 4.)
Test 2
Test 1 offered interesting but perplexing results. Customers said
they were not enjoying
the digital display experience, but they also stayed in the store
longer and bought more. With
Test 2, the Group wanted to understand the increase in customer
buying behavior and
determine what was causing customer dissatisfaction. After five
months of running digital
signage, ICA turned off all displays for several weeks. When
displays were switched on, they
were only switched on in half the number of stores. These stores
became the treatment stores,
whereas the other half became the controls. The pattern was
reversed halfway through the test:
treatment stores turned off displays and became controls,

17. whereas control stores turned on
displays to become treatment stores.
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BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
6
With this shift, ICA also examined how customers reacted to
two types of programming:
inspiration, which featured photos, recipes, and tips in an
attempt to improve store ambience;
and be/price, which was informational and described prices,
deals, loyalty cards, available
bonuses, and other relevant details. The research team believed
that “If the negative attitude
shift was due to the screen itself, the content would not matter.
Hence, no matter what the
content was, merely using the digital sign would yield the
negative attitude shift. However, if the

18. negative attitude shift were due to the content, we would get
different results depending on the
way we presented our communication on the screens.
This test offered three results.
1. The attitude shift changed direction. Approximately nine
months after initial installation
of displays, consumers expressed more positive attitudes in
response to digital signs that
were turned on rather than off.
2. The sales increase realized when digital signs were on
remained significant.
3. The two types of digital content elicited results the ICA
Group had predicted, according
to shopper survey responses. Shoppers in stores featuring
inspiration content believed
they would spend more, whereas shoppers who saw be/price
content reported they
would not change their purchases, compared to purchases they
would make in a control
store with no digital displays. However, the sales transaction
log showed the opposite
pattern: Sales went up with promotional messages and down
with ambience-improving
images, on average by a small but significant amount. Thus,
both retailers and customers
were incorrect in their predictions for behavioral effects
brought about by different types
of content. (See Exhibit 5.)

19. Test 3
The ICA Group worried about extrapolating to smaller stores
the results from these two
tests conducted in larger stores. Therefore, it ran Test 3 to
examine effects of the displays in
smaller stores. In these environments, the Group inserted fewer
screens per store to avoid a
sense of clutter. As in Test 1, findings revealed that customers
noticed the screens; shoppers
even seemed to notice the signs more. They offered comments
such as, “There are many digital
screens in the store today,” suggesting that they strongly sensed
the presence of digital signs.
Yet other outcomes were reversed in the smaller stores.
Consumer attitudes were more
positive, and sales decreased. For example, when consumers
were asked how positively they
perceived a store overall, on a scale of one (very negative) to 10
(very positive), those shopping
with screens on rated a store as significantly more positive (M =
8.33) than those shopping with
screens off (M = 8.03, p = .003). The digital signage had
positive sales effects on adjacent end-
cap displays in larger stores; but in smaller stores, the number
of sales to consumers who looked
at an end cap without signage after viewing one with signage
fell by approximately one-quarter.

20. For the exclusive use of N. Bardawil, 2017.
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from August 2017 to December 2017.
BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
7
Summary and Remaining Questions
The ICA Group had done a thorough job testing the effects of
digital signage in both large
and small store formats. Intriguingly, researchers found that
customers disliked screens in large
stores but increased spending of both time and money when
screens were present. In small
stores they found the opposite effects: Customers appreciated
stores more with screens present,
but purchases dropped. Thus, the ICA Group had spent months
running multiple tests in
various stores, and it had invested in adding displays to a
substantial sample of stores. But was it
any closer to a choice? Should it implement ICA TV chain-

21. wide?
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BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
8
Exhibit 1
ICA Group Digital Signage
Source: Photos by author Anne Roggeveen with permission of
company.
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22. Marketing Management taught by Kristin Houser, HE OTHER
from August 2017 to December 2017.
BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
9
Exhibit 2
Location of Digital Signage in Stores, Test 1
Source: Diagram prepared by the company.

23. Checkout
4–6 screens
Deli
1–2 screens
End caps
5 st pelare (Kvantum)
à 3 skärmar
Försäljning/intäkter
-Vara-pris
-Produktnyheter
Produce
1–2 screens

24. Entrance
2 screens
Perimeter
6–8 screens
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DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
10
Exhibit 3
Percentage of Customers Noticing Digital Signage
Location in Store
Stores Fruits and
Vegetables
Deli Aisle Before Checkout

25. Line
At Checkout
Line
Total
Solna 38% 24% 39.8% 34% 41% 35.7%
Haninge 24% 37.9% 23.8% 28.4% 61.8% 36.9%
Ahus 19.8% 53% 61% 44.5% 36% 42.4%
Norrtalje 30.3% 33% 58.8% 40.5% 56.3% 44.4%
Total 28% 36.96% 45.64% 36.5% 48.74% 39.84%
Note: These percentages refer to the percentages of customers
who noticed the signage in these locations
throughout the store; total refers to the total percentage of
customers who noticed any signage in the
store.
Source: Provided by the company.
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26. from August 2017 to December 2017.
BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time
11
Exhibit 4
Comparison of Customer Attitudes: Screens On Versus Screens
Off
Off On Significance
I like to shop in this store. 6.11 6.19 .335
I would like to have more time to look around this store. 3.68
3.06 .000
I do not want to return to this shop. 1.57 1.77 .088
Today I am focused on getting things done. 5.78 5.57 .100
This is a positive place to talk to store staff. 5.29 4.80 .000
I would avoid looking around or exploring in this store. 2.28
2.51 .090
I like this store environment. 6.06 6.03 .762

27. Today I am forced to be in the store. 5.12 5.06 .701
I often make unplanned purchases in this store. 4.60 3.62 .000
This is a place to avoid store staff and talking to them. 2.17
2.56 .004
This is the kind of place to spend more than planned. 5.39 4.74
.000
There are many televisions in this store. 3.43 3.68 .128
Today I am in the store because I like it. 4.70 3.80 .000
Note: Items that differed significantly are presented in bold
font.
Source: Provided by the company.
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Marketing Management taught by Kristin Houser, HE OTHER
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BAB274
DECEMBER 2014
ICA: Changing the Supermarket Business, One Screen at a
Time

28. 12
Exhibit 5
Customers’ Reactions to Different Content, Test 2
Inspirational Be/Price Significance
I like to shop in this store. 6.05 6.23 .065
I would like to have more time to look around this shop. 3.18
3.39 .247
I do not want to return to this shop. 1.76 1.83 .577
Today I am focused on getting things done. 5.08 5.32 .102
This is a positive place to talk to store staff. 5.19 5.40 .124
I would avoid looking around or exploring in this store. 2.09
2.32 .098
I like this shop environment. 5.69 5.93 .045
Today I am forced to be in the store. 4.50 4.84 .053
I often make unplanned purchases in this store. 4.62 4.17 .008
This is a place to avoid store staff and talking to them. 2.48
2.59 .485
This is the kind of place to spend more than planned. 4.98 4.83
.256
There are many televisions in this store. 3.64 3.20 .031

29. Today I am in the store because I like it. 4.63 4.54 .553
Note: Items that differed significantly are presented in bold
font.
Source: Provided by the company.
For the exclusive use of N. Bardawil, 2017.
This document is authorized for use only by Natalia Bardawil in
Marketing Management taught by Kristin Houser, HE OTHER
from August 2017 to December 2017.