Skip navigation

INDEPENDENTS FIGHTING BIG STORES WITH MEAT

LAS VEGAS -- Independent retailers feeling the pinch of Wal-Mart are discovering that their meat departments can help them stay competitive -- and retain a distinct image in the marketplace.Falley's Inc./Food 4 Less, Topeka, Kan., focused on making meat a destination department while Harps Food Stores, Springdale, Ark., launched an aggressive campaign asserting the superior quality of its meats as

LAS VEGAS -- Independent retailers feeling the pinch of Wal-Mart are discovering that their meat departments can help them stay competitive -- and retain a distinct image in the marketplace.

Falley's Inc./Food 4 Less, Topeka, Kan., focused on making meat a destination department while Harps Food Stores, Springdale, Ark., launched an aggressive campaign asserting the superior quality of its meats as compared to Wal-Mart's.

Executives of both operations, whose locations in many cases compete directly with the Bentonville, Ark.-based giant, highlighted their strategies during a session of the National Grocers Association's Supermarket Synergy Showcase 2004 here.

"We have more experience competing against Wal-Mart than we'd like to," said Roger Collins, Harps' chief executive officer, noting that 41 of his company's 42 stores are within 30 miles of a Wal-Mart Supercenter or Neighborhood Market, and that both companies share a home state. "We knew we had to find a powerful way to differentiate ourselves."

Harps' strategy was to go directly after Wal-Mart with an ongoing series of television ads and store-branding efforts emphasizing differences between the meat programs at the stores.

Not all of the initiatives have been successful, Collins conceded. Harps' initial campaign in 1998 involved promoting its USDA Choice beef over its competitors' Select, but that effort was abandoned after executives determined consumers didn't know the difference. "All they saw was a higher price," he said.

The company literally and figuratively sharpened its knives beginning in 1999, asking, "Where's the Butcher?", to capitalize on Wal-Mart's shift to case-ready meat. The campaign mimics the humorous "Where's the Beef?" ads of fast-food giant Wendy's, and features a character known as The Butcher Lady, who fruitlessly searches retail stores for custom cuts of meat before finding them at Harps.

Although the ads don't mention Wal-Mart by name, it's clear whom they target. "We're hammering Wal-Mart on quality," said Collins.

"It changed our customers' perception," he added. "People believe our meat is better than Wal-Mart's."

The effort hasn't stopped there. Harps has used The Butcher Lady to introduce ads deriding competitors' meats that include added solution or added sodium. One commercial shows an animation of a steak attached to a spigot and the tagline: "Water is for drinking, steak is for eating."

Most recently, Harps extended the efforts to pork and chicken with added solution or sodium. The slogans "No Solution Added" and "No Sodium Added" appear on grocery bags, in print ads and signs in the stores.

"We gambled on the idea that case-ready meat was not consumer-driven," Collins explained. Meat has grown from 15.5% of Harps' total business to 18.1% since the campaigns began in 1998, helping the chain maintain its sales against ever-increasing competition.

Food 4 Less, a 30-store chain owned by Associated Wholesale Grocers with stores in Kansas and Missouri, saw 26 competitors open in its market areas during 2003, including Super Targets, Wal-Mart Supercenters and Neighborhood Markets. Wal-Mart is expected to add another five stores in Food 4 Less territories this year. According to Stan Edde, Food 4 Less president, meat is the chain's key weapon to drive sales in that competition.

Edde said the independent has added employees and increased hours in the meat department, and implemented an employee incentive program. Products are merchandised with better labels, store signs and advertising, and are the subject of spectacular events including a 12-hour sale that draws consumers from a 50-mile radius.

Food 4 Less runs the special sale in select stores about six times a year, Edde said. The event features reduced prices on every item in the meat department, and is promoted outside of the store's traditional trade area.

"It takes customers out of our competition, and puts them in our stores," Edde explained. Because much of the sales come from outside shoppers, meat sales are unaffected in following weeks.

Though meat takes the largest proportion of sales, the event works for all of the store's departments, Edde said. A recent 12-hour meat sale in Food 4 Less' Great Bend, Kan., store generated $228,000 -- $177,000 of which was meat. But the total also included 1,000 rolls of French bread, three times the store's daily produce volume and brisk sales of such items as barbeque sauce and charcoal.

Other times during the year, Food 4 Less promotes meat sales with a "destination" strategy borrowed from similar efforts in Center Store. The "Red Hot Meat Sale" features 60- to 90-day reductions on hundreds of fresh and frozen meat items, marked with special signs and promoted via television commercials and store circulars.

"We use meat on the front page of the circular, and drive the entire ad through the meat department," said Edde.

TAGS: Walmart