DALLAS -- Tom Thumb Food & Drug here has instituted a new merchandising program called Multi Buys, which offers shoppers discounts if they purchase a specified number of grocery and frozen food items.
In its early weeks the program heavily concentrated on the Tom Thumb, Food Club and Top Crest private labels, although national brands have now begun to appear.
Items featured in the program have included Food Club English muffins, four six-count packages for $2.66, a savings of 50 cents off the regular price of 79 cents per package; Top Crest toilet bowl cleaner, four for $2.67, a savings of 89 cents off the regular price of 89 cents per package, and 2.5-gallon jugs of Tom Thumb spring water, four for $7.16, a savings of $2 off the regular price of $2.29 per jug.
Tom Thumb, a division of Randall's Food Markets, Houston, began the program in November, at the same time Randall's instituted the same program, Cindy Crane-Garbs, Randall's vice president of marketing and public relations, told SN.
"The idea is that by stocking up you are able to save a little bit of money. In today's economy everyone is looking for a way to be more cost effective. We felt like Multi Buys really answers that," she said.
Crane-Garbs said the program has not been in action long enough to accurately gauge its impact on sales, but early indications look promising.
"We are pleased with our customers' responses to the Multi Buys program. We feel like it is being very well received," she said.
Some local industry sources
here said the program appears to be off to a slow start.
"This program is confusing to the consumer. They don't understand that you have to buy three of these and then get the fourth one at a discount. If you buy one, it is not automatically reduced. You have to buy the specified number of products," said one Dallas observer.
"Another problem is that the stores are not running it at a hot enough price to really make it meaningful. They're saying that if you buy all of these products it is equivalent to a bulk pack, but other stores in the market run some of the same products at a cheaper price," the observer said.
"Randall's is attempting to capture the bill-back money that they thought they might be losing when they began being serviced by Fleming," said another observer.
The program was initially confusing to the industry as well, said sources, which might explain the early emphasis on Tom Thumb private labels.
"The way the Multi Buys program was positioned with the trade, brokers, etc., it was a little hard to understand at first. I'm not sure that everyone knew how the program worked or how they could functionally make it work for their brands," said an observer.
"As time goes on, I think that they can use it as a tool that will work more for branded products," the observer added.
Crane-Garbs said Randall's did not heavily promote the program at first, which may have given the impression that it was not popular.
"We came out with a soft launch. The danglers in the store are the main signage stating that we are doing this, along with the circular. But this program enables us to offer a lower-cost product," she said.
Observers said the company now is starting to increase the promotion of the Multi Buys program more in the stores.
"There is a lot of emphasis put on the Multi Buys programs through displays, shelf tags, in-store banners, etc.," said one observer.
"Tom Thumb is merchandising it with some good displays. They are putting some endcaps up for the Multi Buys, but so far they don't have big floor displays," said another observer.