MIAMI BEACH, Fla. -- Supermarkets can no longer compete on price alone and must develop a brand image that connects emotionally with consumers and communicates that the store provides effective solutions for time-starved shoppers, according to a report issued at the Food Marketing Institute Supermarket Advertising/Marketing Executive Conference here last month.
organization. Retailers also need to incorporate their brand image throughout their stores "to create a distinct look, feel and sound," the report suggests.
Among the data cited in the report: 64% of U.S. retailers operate a loyalty program, and those retailers who offer loyalty programs garner 79% of their store sales from loyalty customers. Also, food retailers spend 1.17% of annual sales on advertising, with 75% of ad budgets devoted to selling branded products at a competitive price and 8% spent on private-label promotion. Print advertising captures 80% of supermarket spending.
The report suggests that supermarkets devote less of their advertising to promoting price and more to promoting their image.
Meanwhile, another report issued at the conference, presented by direct-mail services company Advo, Windsor, Conn., suggested ways that supermarkets could best design their ad circulars.
The survey revealed that 70% of consumers said they prefer pictures of meat and seafood that are cooked and presented as a finished dish. When asked what products they want to see featured on an advertising circular that will help them decide where to shop, 66% of consumers said they wanted to see meat/poultry, 54% said they wanted to see produce and 37% said they wanted to see beverages.