Grocers Pump Up Promotions
To get something, you sometimes have to give
something. That is the clear lesson that retailers have learned in the past
couple of years as many consumers demand some kind of deal to purchase products.
Grocers in the Jacksonville, Fla. market have
certainly gotten the message, having increased the amount of product sold
on promotion from 38.7 percent for the 52-weeks ending Oct. 4, 2008 to 43
percent for the same period this year, according to The Nielsen Company.
in Chicago buy more product on promotion than any market, with 55.9 percent
of all items sold having some deal attached. That is up two percent from
the previous year.
Nationally, the percent of groceries sold on
promotion for the period ending Oct. 3 was 42.8 percent, up two points from
the year before.
Jim Hertel, a managing
partner at Willard Bishop, told the Jacksonville Business Journal, “All
things being equal, shoppers will always prefer saving money.”
promotions can drive business but Mr. Hertel added, “The question retailers
need to ask themselves is, ‘Am I really accomplishing anything or am I
just giving money away?’"
Questions: Are grocers making the best use of promotional programs today?
Are there too few or too many, and are they running the right types of promotions?
Will grocers continue to promote at current or higher levels once the
economy has rebounded?