retail news in context, analysis with attitude

Good piece in Advertising Age about retailers that are “flourishing” or “floundering” during the current economic upheaval, looking for “common threads” that lead to higher sales: “keep spending, target your marketing and look for ways to offer value.”

Among the companies cited in the piece:

• Kroger, which “managed a 6% increase in stores open at least a year during the third quarter, and analysts said the grocer has narrowed the pricing gap with Walmart to less than 10%. Last year Kroger offered consumers 10% off if they spent their tax rebates at the chain, and it offered gas discounts and free groceries in exchange for points earned through its loyalty-card program. The retailer is also using a lot of direct marketing. For example, data from its loyalty-card program are being used to send unique coupon offerings to specific households.”

• While CVS has lowered its broader marketing spending, the company points out to Ad Age that its loyalty marketing program is not tracked: “That program, which counts more than 50 million cardholders, has spawned more targeted marketing efforts, with promotional offers at the register, coupons, e-mail and direct mail.” And that program allows CVS to try to have personalized “conversations” with those cardholders.

Ad Age suggests that Whole Foods, but cutting “its already meager advertising budget, may be exacerbating its problems with slowing sales, though the company argues that it “is benefiting from the trend toward more meals at home.”

KC's View:
It isn’t exactly a surprise that Ad Age would have a story suggesting that more marketing and advertising is the way to greater sales…but that doesn’t mean that the point is wrong.

I continue to believe that smart companies should be in a market share game these days, expanding their marketing and services in a way that will build up their customers bases. As an example, check out our next story…