The Phoenix Business Journal reports on how Sprouts Farmers Market CEO Jack Sinclair said that the company fell short during Q3 - sales were down four percent from a year earlier, while same-store sales were down 5.4 percent - because it did not deliver on a changed marketing strategy.
Sinclair took over as CEO in mid-2019, and "right away wanted to revamp how the company marketed. He quickly dropped the weekly paper flyers that were mailed to customers because they were too costly and didn’t connect with target customers."
According to the story, "Sinclair said one of the areas Sprouts fell short in its new marketing strategy was with its produce. In most markets, Sinclair said, Sprouts’ produce section is 30% to 35% cheaper than the competition, but customers don't know that, he said … Going forward, Sinclair said Sprouts marketing campaigns need to be aimed at highlighting its producing pricing, the innovative and new products consumers can get at Sprouts and how to get new customers that look like existing customers."
“I fundamentally believe that we've got to tell the story of what the key differentiator of Sprouts is more effectively,” Sinclair said on an investors call.
- KC's View:
It does suggest that Sprouts has problems when the company concedes that during the height of the pandemic its transaction rate dropped by 25 percent - that being a time when people were spending more time in supermarkets and buying up almost everything they could find on shelves.
But, Sinclair seems to have a handle on the issue if he's acknowledging that the retailer has to tell its story more effectively. That's a key part of any marketing strategy - not just having the right products, but being able to tell a compelling story about their relevance and resonance to your customer base.