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Evolution Of Grocery Promotions
This paper will be distributed into a 3-part series. Throughout the paper, retail promotions will be defined as a persuasive marketing strategy to drive near-term sales.
To be more specific, the focus will be on targeting product-based promotions. These promotions should tie into or align with broader marketing initiatives, and do not always require an associated discount.
To kick off the series, Part 1 will examine the evolution of product-based grocery promotions, primarily from the grocer’s perspective. This will include changes driven by technology and consumer behavior influenced by Covid-19.
Table of Contents
The global pandemic has changed the grocery climate more in the last year than the previous 10. Despite people being creatures of habit, the sheer significance of the pandemic drove change in consumer behavior.
The pandemic accelerated the adoption of alternate fulfillment options: E-comm, BPOIS, and home delivery. But more than this, consumer behavior has changed when it comes to food. Today there is a renewed interest in cooking (whether healthy, ethnic, etc.), growing and canning food and utilizing meal delivery services.
Many grocers ignored these changes, because their time and resources were spent trying to stock shelves and keep customers and employees safe.
In addition, changes were happening before Covid-19 that grocers cannot afford to overlook moving forward. Customer relationships continue to be eroded and/or
moved from traditional grocers to vendors, social influencers, Instacart, and Amazon.
Grocers have only a few levers to use to compete because the items they sell are commonly available. These are selection, price, and service.
Selection
• Breadth of Assortment
• Quality of Product
• Specialty Interest
Price
• Everyday low price
• Bulk pricing
• Coupons and promotions
Service
• In-store experience – clean, friendly
• Education – recipes, in-store tastings, etc
• Convenience – store locations, BOPIS, delivery
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