Schwan has been delivering groceries for years. The channels have caught up.

Mary Bartels can’t wait to see Schwan’s yellow truck pull up to her apartment building in Vermillion, South Dakota. She has been receiving deliveries of frozen products, including ice cream, meat and meals, for almost 60 years.

The company’s customer service is at the heart of its loyalty.

“It’s always been amazing,” she said. “I trust them so much that I would hide a key outside if I wasn’t home.”

That day, driver Nate O’Grady rings the doorbell and sits down at Mary’s kitchen table. As a child, yellow trucks arrived at his grandparents’ house. Today, he says getting to know the customers, children and pets along the way is one of the highlights of his day.

“You have a lot more connections with customers than with Amazon, where they ring your doorbell and leave. We have time to sit and talk with people,” O’Grady said.

He knows what customers are going to order before they ask. For Mary, each order requires a box of peanut butter ice cream minis.

Schwan’s began in 1952, when 23-year-old Marvin Schwan went door to door delivering 14 gallons of his family’s ice cream to homes in rural western Minnesota. Over the next 70 years, the company became beloved for its yellow trucks, friendly delivery people and frozen foods.

In 2018, South Korean food maker CJ CheilJedang agreed to pay $1.8 billion to acquire a majority stake in Schwan’s. The Schwan family spun off the home delivery business and retained 100% of it.

Schwan’s Home Delivery changed its name to Yelloh in 2022 in an effort to attract a broader customer base in what is now a crowded food delivery space. The following year, it cut 750 employees and closed about 90 delivery centers.

21st century competition

Today, customers in all but 18 states rely on UPS to deliver their Yelloh frozen products instead of the usual yellow trucks.

Yelloh faces a much more competitive market. Danny Edsall, co-head of Deloitte’s global grocery business, said the food sector has gone through several phases of evolution over the past few decades.

“Everyone understood that grocery is an extremely important category,” he said. “So there’s a whole new wave of entrants looking for grocery money. »

Yelloh’s main competition used to be local and family markets. Today, it faces big box stores like Walmart, Target and Costco. Amazon, Grubhub and others will even bring your groceries right to your door.

“I think we’re in the heat of battle, it’s still to be decided who wins,” Edsall said. “People who succeed are those who genuinely try to know their customers and tailor their services to meet their needs. »

It’s not uncommon for a legacy company like Yelloh to change strategy as it faces a more crowded market and changing customer preferences, Edsall said.

“The art of retail is reinventing yourself for a new consumer,” he said. “You always have to reinvent your brand while remaining relevant. The companies that succeed are those that will still be around in 100 years.

O’Grady, the delivery driver, said he sees the new Yelloh brand slowly taking hold with his customers – but not with Mary’s.

“Did they change the name? she asked O’Grady. “I didn’t know that, when did they do that?”

A nostalgic rebrand or the end of an era?

The new name was inspired by customers’ memories of yellow trucks, according to CEO Bernardo Santana.

“It’s very common for us to hear, ‘I remember when I was a kid in my grandmother’s house, I saw the yellow truck with the ice cream,'” he said. “Our strongest brand is our yellow truck, so we wanted to reestablish and maintain that connection with our customers. »

But Akshay Rao, a marketing professor at the University of Minnesota, worries that Yelloh’s new name is a departure from a 70-year-old brand and creates confusion among its loyal customers.

“They may think, ‘Who are these people?’ Are they the same people friendly to my ice cream?'” he said. “So Schwan’s had a monopoly to which it said – from what I understand – goodbye.”

Rao said he hasn’t seen the company’s research, but he suspects Yelloh’s new rebranding and discounts are part of a strategic shift, emphasizing costs rather than customers. He added that only time will tell if the move will succeed, but he is skeptical.

“Schwan’s had an intimate relationship with its customers,” he said. “The company is now moving away from that relationship and customers will start to consider other options.” »

Deb Kuwamoto is one of those clients. The Lincoln, Nebraska resident can no longer get delivery directly from a Yelloh truck. She loved chatting with delivery people and can name all her drivers for 10 years.

Now, Kuwamoto said she will just go to the grocery store instead of ordering from UPS.

“It makes me a little sad,” she said. “I think it’s the end of an era. I miss the drivers.

And she doesn’t like the new name. Kuwamoto said ordering from Schwan’s makes him feel like he’s going back to his childhood in rural Nebraska. “It’s really ironic, because Schwan’s was kind of like the first grocery delivery,” she said. “And now everyone has caught up with them.”

Santana, Yelloh’s CEO, said customers remain the company’s priority, even as it shrinks its delivery footprint.

“We try to deliver to our customers efficiently and keep up with all logistical changes. We didn’t have the Internet when Schwan started,” he said. “And there are all the changes in the market environment: 20 years ago, Amazon didn’t exist. Now it’s this fortress.

Plus, Santana said, some customers prefer a quick drop-off rather than a small chat with a driver.

“Some people just ask, ‘Leave my product in a bag at the door,’ while others just chat with our drivers,” he said. “It will take time, but we are building a new brand that can attract every possible customer.”

A family tradition

Back in Mary’s apartment, she remembers when she first started ordering from the company almost 60 years ago. Her nine children rushed down the farm driveway to meet the delivery man and climbed onto his yellow truck.

“They would all come in with an ice cream bar or something. And now I realize he was giving them to the children out of his own pocket,” Mary said. “Because I wasn’t paying them.”

At one point, she ordered to feed a family of 11, and she continued to order from Schwan’s until her children left for college, moved to the city from the farm, and until she passed away. from her husband.

As she sits in her chair with her memories, driver Nate O’Grady checks her freezer for what she needs, taking the peanut butter ice cream sundaes, fantail shrimp and chicken pot pies from his truck and pack them on the freezer shelves. She did her shopping without getting up.

O’Grady says goodbye and gets into the yellow truck idling in front of his apartment – ​​still stamped with the Schwan logo.