Safeway Launches ‘Locally Grown’ Campaign
By Tom Ryan
Safeway Inc. last week launched a “Locally Grown” campaign
featuring new in-store signage that maps its growers, store visits from farmers
and advertising that touts its local produce. The move appears to take a
page from retailers such as Whole Foods that have marketed their commitment
to sustainable, organic and locally grown foods to bond with eco-conscious
consumers.
“We’ve been purchasing locally grown agriculture
for a long time,” Steve Burnham, vice president of produce for Safeway, told the
San Francisco Business Times. “What is new is our
initiative to share it with the consumer. And share just how committed we
are to buying locally grown. I don’t think we’ve done a tremendous job of
that in the past.”
In a statement, Safeway noted that nearly a
third of its produce comes from local sources. In California, the number
reaches 45 percent.
Safeway said its commitment means that shoppers
can find more local produce per item at its stores than at a typical farmer’s
market. The “Locally Grown” campaign features partnerships with local farmers
such as G&S Farms of Brentwood, CA, a grower of sweet corn and green
beans, and Fitzgerald Orchards of Tyro, VA, which has supplied East Coast
Safeway stores with apples for nearly 60 years. The program gives purchasing
preference to such local growers.
Stores will feature “Locally Grown” promotional
signs that highlight specific growers in the region, “locally grown” reference
maps that will geographically show the location of key local farmers as well
as point-of-sale material that will tell the story of Safeway’s local farmers.
Safeway said that in addition to the quality
benefits, buying locally grown fruits and vegetables reduces greenhouse emissions
by limiting transportation miles. Sourcing locally ensures the vitality of
local farms, which translates into economic opportunities for local communities.
Safeway also said the locally-grown product “will be competitively priced,
giving Safeway customers the best value for their money.”
Discussion Question: What
do you think of Safeway’s “Locally Grown” campaign? How should Safeway
be marketing the strategy? Will this help them better compete with Whole
Foods?
This is more about the press release as Safeway tries to greenwash an existing buying strategy. It’s the exact same produce department except Safeway is now telling customers which produce came from the local region. Wow, imagine telling customers in Washington that their apples are local? Or telling their customers in Hawaii their pineapples are grown locally. Since this is something every grocer can do, I doubt it will have much impact. I think if Safeway wants to seriously try to take sales away from Whole Foods, they will need to do more than just put up some signs.
A straight lift of WF’s campaign–but not a bad idea. As long as they don’t try to extract a price premium for “locally grown” as they do for “organic” it is probably going to be a “nice” program at best and a wash at worst.
This is a nice marketing ploy from Safeway. It should resonate with consumers who are concerned about freshness, the environment and sustainability. Safeway is always looking for ways to separate itself from the mass grocery competition. This should give them a leg up. And with Whole Foods continuing to suffer during the recession, Safeway may be able to pick up some WF customers. Smart move.
To David’s point, I agree there is more to attracting new shoppers than putting up signs about where food comes from. But flip the concept and consider big grocery working to RETAIN the thousands of shoppers now seeking a lot more transparency from both retailers and manufacturers. The bigger the company, the more important it is to have a retention strategy. Safeway has been a good listener, and responding to offer its shoppers what they seek. In the long haul, this should keep the business stable.
Let me begin by saying that anytime I read a comment such as “what IS new is our initiative to share it (information) with the consumer” I immediately think reactive as opposed to proactive.
In all likelihood, Safeway is not doing business differently. Instead, Safeway believes it is not getting credit on an issue they see as an emerging consideration for consumers. If “locally grown” is a consideration for its customers, I applaud Safeway for taking steps to launch a communication program to demonstrate that it recognizes and shares certain values with its customers. Safeway customers should feel good about their decision to shop at this grocer. On the matter of making Safeway more competitive with Whole Foods, I do not see how this would occur. There is a gestalt to how Whole Foods operates that places it in a different category from conventional grocery. That being said, Safeway will achieve the important goal of convincing shoppers that, although it is not “just like Whole Foods,” there is more overlap than some people would imagine.
Safeway is not the only company using this strategy, which resonates with many consumers. It is certainly consistent with the makeover strategy Safeway has been promoting with an “ingredients for life” campaign, and the store redesign to promote a marketplace look. If Safeway has read their consumers correctly this can be an excellent move.
Safeway’s move to feature locally-grown food should be viewed as a positive–they may be slower than other retailers to bring this about, but consumers expect open communication on the topic. It’s good for strengthening ties to community producers, it’s good for consumers to know produce sourcing, and it’s good for Safeway to create more transparency around their programs for healthy living.
Offering locally grown merchandise provides an opportunity for Safeway to develop a strategic advantage over other traditional supermarket chains. First, offering locally-grown produce provides appealing merchandise (organic, local) that differentiates Safeway’s offering from Walmart and other traditional supermarkets. If Safeway develops strong relationships with local providers, it might be difficult for competitors to duplicate Safeway’s locally grown offering due to limited supply. On the other hand, operational costs and problems (stockouts) might increase due to the need to deal with a large number of small, local vendors.
This is a great idea! It is back to the future! That is how the industry ran 30 years ago! Particularly with Safeway, it’s what helped them grow in the first place! Will it help? YES! Why? Because fresh equals authentic, which in turn provides a larger halo for their high-margin ready-to-eat, ready-to-heat food program. Grocerant style food continues to be hot!
I would like to see a true push for genuine differentiation. Even that, though, wouldn’t be anything new. I can remember back in the ’70s, when Jewel Foods in Chicago (my Alma Mater) advertised “Super Sweet Corn” in the produce dept. Only a few weeks of the year, customers would flock to Jewel for locally-grown corn on the cob that was guaranteed to have been harvested only twelve hours ago, by the time it reached the store. Yes, 12 hours! Think about that supply chain just for a minute.
This was a key selling point for that item, since corn turns to starch sticks in only a few days, and loses all its sweetness quickly.
Locally-grown needs a compelling reason for the consumers to care, such as this example shows.
Whole Foods is innovative, forward thinking and successful. They have been rewarded for their unique offering by attracting abundant and loyal customers. But, if we look at the share of market that goes to Whole Foods and their kin and compare that to conventional grocery (which includes Walmart), conventional grocery wins by multiples.
Safeway’s simple, inexpensive effort makes ultimate sense. Consumers are often mindless when they shop. Sometimes you must tell them the obvious. In this case a local produce message. If I were to rate the average shopper’s concern for “green,” I would start with produce. If Safeway can match this consumer preference, they take a sharp arrow out of the Whole Food quiver. And, they can still offer the conventional shopper Tide, Coke, and Pop-Tarts.
I am reminded, not all that favorably, of a recent story about a certain chip company making a song and dance about using “local” potatoes. Because some of their potatoes are grown in the states where some of their chips are sold. But not necessarily guaranteed by batch. I think there was a similar story about someone using “local” tomatoes, defined in the same way. And Whole Foods, of course, has an extremely loose definition of local (in the UK it’s anything grown/made anywhere in the country because we are such a very small country). Oh please…
When I’m in the US I do shop Safeway and generally like them. If, as others say, they are simply taking the opportunity to give themselves credit for something that they have been doing for a while and which they recognize will please their customers then that’s OK by me. It’s the specifics about the producers and the farms that convince me that this is considerably more than a disingenuous bid for publicity.
When you are a mass retailer, ANYTIME you can merchandise products to make them more relevant to consumers or highlight authenticity you will gain credibility in the minds of consumers. You will make a connection in a world community that is still trying to stay in tune with the local vibe.
Kudos to Safeway for finally talking about what they have been doing all along. Customers who care about this issue will pay attention, and those who have not yet will begin to notice. It fits right in line with their other initiatives to be greener and healthier in their stores and through their private-label products.
I support the concept of going locally grown (and organic when possible. Of course it rolls out well when you live in CA and have access year round to thousands of acres of strawberries, tomatoes, avocados, oranges, etc. Not sure what grows locally during the winter in MN, IL, etc, but the concept is understood.
It also cuts down on the carbon transportation footprint and supports the local economy.
So, while it may be good PR, that is secondary to a sound business strategy. Cheers to Safeway.
I agree with Anne that this is a retention strategy. As more and more consumers learn of the benefits of supporting local agriculture, they won’t have to change their shopping habits to find a farmer’s market or the nearest WF should they decide to make this a commitment in their lives.
I think this is a nice way of maintaining the “community” aspect of large retailers that can sometimes get lost. I think back to the book “The Big Box Swindle” and this would certainly be a nice way to alleviate some of the fears of big retailers swooping in and killing the local businesses.
Although some may feel this is a “green wash,” I think it more simply an implicit understanding by Safeway of a pertinent (in the mind of their customers) interest that needs to be communicate with accordingly. To understand that their customers have “interests” that they feel passionate about and marketing accordingly to them is very comprehensive.