In a RetailWire poll in April, 27 percent said Stop & Shop and Giant Foods' Value Improvement (price freeze/cut) Program would lead consumers to have a perception that the chain's prices were somewhat or much lower than the competition. Forty-two percent said the program would lead to the perception that the chains were price competitive with others merchants in their markets.
It appears, at least in the Baltimore market, that price cuts combined with store remodels have helped Giant achieve market share gains for the first time in six years.
According to Food World, Giant increased its share
from 27.48 percent to 27.58 percent in the 12-month period ending March
31. Giant stores generated $1.27 billion in sales for the period
compared to $1.26 billion the year before.
Jeff Metzger, publisher of Food World, attributed Giant's
gains to its price cuts.
"If there's one thing this economy has taught us, it's
that you'd better move price up a few places in your lineup, even if you're
not a 'price' operator,"
Mr. Metzger wrote.
Safeway took second in the Baltimore area. The chain saw its share of market grow from 16.09 percent to 16.39 percent.
Craig Muckle, a spokesperson for Safeway, told The Baltimore Sun, "The fact that we have gained market share, not only this year but in previous years, demonstrates that our lifestyle format is being very well received by our customers."
Discussion Questions: Does the market share improvement in Baltimore suggest to you that other grocery chains should concentrate more on their price positioning? What will Giant need to do next if it wishes to build on its market share gain over the last year?