PLEASANTON, Calif. - Healthful foods can make for a healthy bottom line.
That's what Safeway here discovered with a health- and wellness-themed promotion it recently ended. The retailer wouldn't provide specifics, but said Living Well, Feeling Great produced redemption rates as high as other manufacturer-supported promotions in traditional categories, like chips and soda.
"That was very encouraging to us, because while this is an important issue to people, it doesn't always share the really high penetration as [carbonated soft drinks] and salty snacks do," said Michael Minasi, senior vice president of marketing. Based on the response, he expects to repeat the program next year.
As a large-scale promotion with a health orientation, Living Well, Feeling Great was the first of its kind, he said. The sale ran for four weeks in April and May, a time of year when interest in healthful living peaks. During that period, shoppers who spent at least $30 on participating products in a single transaction got a $10 coupon at checkout toward their next purchase. Participating Center Store brands included Baked Lay's, Healthy Choice, Propel Fitness water, 100 Calorie Packs and Safeway's own O Organics.
About 3,000 food and nonfood items were included in the promotion. The event ran in all Safeway banners, and was promoted via shelf talkers, print and other ads, and other in-store messages.
Living Well, Feeling Great is one among a number of health initiatives to come from Safeway as it's rebranded itself. That effort has encompassed upscale "lifestyle" stores, high-quality perishables, new corporate brands and a focus on Center Store merchandising.
"We are fundamentally heading down a path to reposition ourselves with consumers," Minasi said of the company's greater health and wellness focus. "We believe as a company that sells food that we have an opportunity to be a little bit more appropriate in terms of our offering and things that we do promotionally."
As part of the private-label branding work, Safeway is starting to roll out products to stores bearing new on-package icons. Icons may address sodium, fat, gluten and allergen content; whether a product is dolphin-safe; and total servings in the package, Minasi said.
While other manufacturers' on-package icon systems have emphasized products' health-related attributes, Minasi said Safeway wanted its icons to serve as a broader "decision-making guide" that would include not only health but other information. Icons will roll out over the next 12 months on items in the Safeway line, one of the retailer's more significant, with thousands of SKUs.
Safeway is also working on a shelf-level sign package that will complement the on-package icons, Minasi said. The retailer hopes to decide in the next six months what form the system will take. "Giving people information at the point of decision is a very important opportunity," he said, adding that this system will be more complex than the icons because it will have to work with coolers, shelves, freezers and the like.
Minasi also said Safeway planned to add a significant but unspecified number of items to the O Organics line, which has 150 today. Safeway sees a big opportunity to expand the line, given the scarcity of national natural/organic brands covering many categories, Minasi said.
"We believe very strongly that [O] represents a national brand-like approach to a very specific need or category across multiple categories in the store," he said. "There are very few product lines that extend across multiple categories."