Publix Challenges Wal-Mart on....Low Prices?

Publix The Walmart Slayer Wins Another Round With Low Prices

Publix is many things — favored among shoppers for quality store brands, customer service and well kept stores — but a low-price leader it typically isn’t. But the grocer Forbes recently dubbed “the Walmart slayer” is pushing ahead with its own campaign comparing Publix prices to the discounter and telling shoppers how much they can save shopping at Publix.

“Walmart doesn’t always have the lowest price,” declares Publix’s weekly ad. “Save $31.45 this week at Publix.”

It’s just another round fired in the volley between Walmart and regional grocery operators. In 2012, Walmart started running ads comparing its prices to competitors and in some cases naming regional chains. This Spring, Publix started fighting back with billboards and ads challenging Walmart’s low price claims.

“All the supermarkets have gotten smarter about how their competing against Walmart,” says Neil Stern, senior partner with McMillan Doolittle, a retail consultancy. “They’re being smarter and more strategic in the way they fight them.”

Many retailers like Publix have decided it’s better to come close to Walmart’s pricing on a list of roughly 500 essential items. It means less margin, or profit, but they try to make it up on items that matter a little less, says Stern.

This focus on price for Publix isn’t new, but the public display is. Many years ago, Stern and I conducted a series of pricing studies in the Atlanta market. We compared like items or price per unit across several stores including Walmart, Target TGT +0.1%, Kroger KR -0.1% and Publix. In nearly every instance, Publix had higher prices by a considerable margin.

The studies were published in a retail trade magazine and inevitably we heard from Publix CEO at the time, Charlie Jenkins. Not to argue the point, but to request the shopping list and more details. Jenkins was more interested in correcting pricing discrepancies and perception than debating the veracity of our claims.

Always the sign of a successful leader.

Price isn’t everything but when a popular retailer with the perceived edge on quality and service can also match the low-price leader, it’s an advantage that’s hard to beat.

Is Kraft Changing The Face Of Marketing?

By Star Group Author Team / Posted on .businessweek.com (View Original Article Here)

 

Posted / RSS Fed on Tue, Aug 9th, 2011

 

 

 

Kraft has been in the news quite a bit over the past week or so following their decision to split the company into separate entities and for a new approach to marketing they are undertaking in Europe which could eventually finds its way to their American brands. With so much going on, one has to wonder, is Kraft changing the face of marketing?

The first story I read about Kraft dealt with their decision to split the company into two separate entities - an international snacks business and a North American grocery business. It surely sent some shock waves through the food marketing world, and the entire marketing world as a whole. The article in Ad Age, Could Kraft Split Be a Blueprint for Blue Chips? claims the reason for the split is, big surprise here... based on financial reasons. "The plan... seems to be a financial move, designed in part to please activist investors who have called for the company to separate its high-growth global snack brands from its slower-growing, more mature grocery brands."

The author of the article also astutely points out that "...it (the split) also holds lessons for multinational marketers, looking to drive value in fast-growing emerging countries." Marketing consultant David Diamond put the split in layman's terms: "Kraft sort of realized that their [grocery-] food-product businesses have just become such a combination of big and commoditized [brands] that they can't deliver what they've promised Wall Street, and when you can't deliver what you promised, well, change the game."

Obviously only time will tell if Kraft's decision to "change the game" will turn out to be a wise one but you can bet many eyes will be watching for if they are successful, look for other large, multinational marketers to at the very least consider following suit and applying the "divide and conquer" method themselves.

To help the new companies succeed, Kraft is employing a new set of marketing tools. In a recent Q&A with the folks at Marketing Week, Daryl Fielding, Kraft's European vice president of marketing, explained these new tools and how they will work and how they will "change the conversation internally, with our agencies, partners and consumers"

Here's some highlights from the Q&A with the quotes coming directly from Ms. Fielding:

• "We look at deep cultural insights, which is what we are doing for all our brands as part of our new marketing framework."
• "If you look deeply at people there are many similarities. That is an absolute requirement - if you are ever going to do decent global communications, you have to find the deep human stuff."
• "Part of it is looking at strategy for the brands. In Europe, we are also looking at a new customer journey tool."
• "We have created a bespoke (tool) electronic piece of software that will help us understand where we can best place our marketing investment and where we might lose and gain customers on the path to purchase."
• "This is a piece of software in which you input data or priorities based on the collective wisdom of the team and it helps prioritise channel or media investment."

So, between the decision to split the company and their fangled marketing tools, the question is... Is Kraft Changing the Face of Marketing?

Obviously, no one knows that... yet. Time will naturally tell but as I said, many people will be watching very closely and I will surely be one of them.

But to me, the one underlying, undeniable common thread in all of this is people.

"...if you are ever going to do decent global communications, you have to find the deep human stuff."
"This is a piece of software in which you input data or priorities based on the collective wisdom of the team..."

See the common theme?

Maybe Kraft isn't changing the face of marketing, at least much as we may think, for hasn't it always been about people? No matter how much technology enters our lives and continues to do so, isn't it always about people at the end of the day?

People who buy your products...

People who create the strategies to get people to buy your products...

Source: Marketing Week, Ad Age , Google Images