It Really Isn’t All About Price or Is It?
Sometimes it seems almost all of retail is engaged in one giant, lemming-like race to the bottom—a competition where the lowest price wins. Yet, not all retailers can offer the lowest price despite claims to contrary. How then, can they change the conversation from price to value received at fair price?
Wendy’s “Right Price, Right Size” menu is its response to the dollar menus offered by its rivals. In a commercial for Wendy’s, a young woman compares the quality of a sandwich bought from a dollar menu to that offered at Wendy’s for very little more. The "you get what you pay for" messaging is clear.
Just as Wendy’s is tackling the issue in foodservice, Kroger provides a good example in grocery where price promotions are prevalent. The company now targets value consumers in some markets by opening Ruler Foods, a deep discount grocery concept that focuses on Kroger and Kroger Value brand items. Some 80 percent of the limited selection is Kroger labels, which offer savings between 30 percent and 50 percent below national brand prices.
Also in limited assortment grocery, Aldi sells itself to consumers stressing a combination of savings and quality. Its own-label products are growing increasingly sophisticated with ingredients and packaging near, at or above that of national brands in many instances.
- Right Price, Right Size – YouTube
- Courting Thrifty Shoppers With Value and Quality – The New York Times (tiered sub.)
- Kellogg’s takes on copycat brands with new online campaign – Convenience Store
- Value Brand Products – Kroger
- Kroger rolling out more Ruler Food shops – Cincinnati Business Journal
- Consumers are picking "premium" or "value" grocery items, not mid-range – Farm Futures
How can retailers shift the consumer focus from price to value received? Are there examples in retailing from the present or past that you think illustrate your point?