RANCHO MIRAGE, Calif. -- IGA Australia is launching an aggressive push to pull in more retailers and customers.
Its goal is to develop programs "that will enable IGA to become Australia's first-choice supermarket," Lou Jardin, chief executive officer of IGA Distribution there, said in a presentation at IGA's Global Summit here.
"The battle over the next five years will be about winning the hearts of consumers," he said. "Over the last 12 months, the independent retailer has faced the biggest challenge ever, with the growth of multinationals with huge amounts of resources. These are huge monoliths with no personalities that take no prisoners. We need each other to work together to survive."
With Cole's and Woolworth, the two major chains in Australia, controlling a 78% market share, "the independents have never had it so tough," noted Fred Harrison, CEO of Ritchies Stores, a 27-store IGA retailer. "So we can either fall away with a whimper, or we can stand and fight."
Jardin said IGA hopes to attract new retailers to join its alliance by running trade ads with the slogan, "If you're not with IGA, are you off your trolley?"
In a concurrent effort to attract more customers, IGA Distribution has launched a series of television commercials that portray IGA store managers as local heroes -- "owners who run a small business, report to their customers, and stay in the local community to build the business," Jardin explained.
IGA has also been methodically researching greenfield sites for stores, "looking at sites that are too small for the chains," he said.
It has already located 29 potential sites in Canberra, Australia's capital city. "Within 12 months, the whole country will be mapped out, with hundreds of opportunities identified," Jardin stated.
IGA has developed a defensive marketing strategy in which it's investigating the impact chain stores have on local communities, "to give us ammunition to defend against their coming to town," he said.
The challenge for IGA intensified recently when Foodland, an independent distributor in western Australia, made an unsolicited bid for Metcash, a major IGA retailer. "If Foodland is successful, that will take $1 billion away from IGA -- or 20% of the Australian market," Jardin said.
However, Metcash has made a counter-offer to acquire Foodland, which would be a big plus for IGA if it happens, he added. The situation is expected to remain in flux for another couple of weeks, Jardin told SN.