Is it time for ‘essential’ retailers to stop running in-store promotions?
Anyone who’s ever read an IRI or Nielsen report knows there are simple and long established steps for maximizing sales in retail stores.
- You must have product on the shelf to sell. The following steps do not matter if this is not the case.
- Temporary price reductions (TPRs) on a product will lift sales above just simply having it on the shelf.
- TPRs with a secondary display, often an end-cap, lift sales even more.
- TPRs with an ad and a display lift sales the most.
The reality at stores classified as “essential” since the coronavirus outbreak has been that a lot of planned sales promotion activity has been paused as grocers and others concentrate on keeping products in stock while keeping associates and customers safe.
A March 26 email from BrainTrust panelist James Tenser identified that stores were pulling back on TPRs and promotional displays. A completely unscientific audit by RetailWire confirms that observation.
On Saturday, Meijer announced that it would temporarily suspend publication of its weekly ad in an effort to decrease customer counts in its stores. The chain of supercenters, based in Grand Rapids, MI, announced its plan along with other steps to protect associates and customers. Meijer operates stores in Illinois and Michigan, two of the hardest hit states in the U.S. to date, along with others in Indiana, Kentucky, Ohio and Wisconsin.
In related news, some are questioning the decision by Lowe’s to go ahead with the chain’s Black Friday sale last week. The sales event promoted in-store only deals on Saturday and Sunday, according to WRTV in Indianapolis.
An unidentified Lowe’s manager in Indiana sent an email to WRTV to comment on the sale.
“Lowe’s chose to move forward with one of our biggest promotions of the year,” the manager wrote. “I am appreciative of the current steps taken but this alone is socially irresponsible and borderline gross negligence on Lowe’s part in this time of crisis.”
A Lowe’s spokesperson responded to a RetailWire inquiry via email. “While some retailers have taken steps to eliminate value pricing, we recognize the importance of continuing to offer value to our customers in this time of economic uncertainty. Affordability matters now more than ever.”
The home improvement chain announced last week that it was cutting store hours, raising pay for hourly associates and taking other steps to address the threat.
“All Lowe’s stores have signage reinforcing the need for social distancing and we remind customers every 15 minutes with overhead announcements,” said the Lowe’s spokesperson. “Stores also have the ability to limit customer capacity in high-trafficked areas. We also have clear signs and floor markers to reinforce CDC social distancing guidelines.”
A two-week stay-at-home order issued by Indiana Governor Eric Holcomb on March 24 has been extended for two more weeks. Indiana has had over 4,400 confirmed cases of COVID-19 to date with 127 deaths.
- Meijer Announces New Efforts to Keep Customers and Team Members Safe – Meijer
- Coronavirus in the U.S.: Latest Map and Case Count – The New York Times
- Lowe’s Temporarily Increases Hourly Wages and Implements New Safety Efforts in Response to COVID-19 – Lowe’s Companies, Inc.
DISCUSSION QUESTIONS: Have you noticed a reduction in temporary price reductions, promotional endcaps and ads from “essential” retailers in recent weeks? To what extent is in-store promotion appropriate during the coronavirus crisis? Do you expect retailers will make changes to their post-pandemic promotional practices based on their experience during the outbreak?