Woolies kicks off price-based campaign

20 Oct, 2015 04:10 AM
Woolworths plans to invest more than $500 million in reducing grocery prices

WOOLWORTHS has kicked off a new price-based marketing campaign - its fourth in as many years - to reinforce its $500 million investment into lower grocery prices.

The new campaign, Always at Woolworths, replaces the much-maligned Cheap Cheap campaign, which was criticised by marketers for dragging Woolworths downmarket and for mimicking Coles' long-running Down, Down campaign.

The new campaign, which will run in print, online, television and radio, emphasises everyday value in Woolworths supermarkets rather than one-off discounts.

That prompted analysts to question whether Woolworths' new supermarkets team, led by Brad Banducci and Dave Chambers, is shifting towards an everyday-low-value pricing (EDLP) strategy rather than a high-low pricing model in an attempt to win back the trust of consumers.

Woolworths plans to invest more than $500 million in reducing grocery prices to "neutralise" Coles and "contain" Aldi. The retailer has invested more than $200 million in reducing prices this year and claims its prices are now as cheap, if not slightly cheaper, than a similar basket of groceries at Coles.

Woolworths said on Monday the Always at Woolworths campaign, created for the retailer by Leo Burnett, was aimed at calling out its new price position.

"Woolworths always calls out its value offer to our customers, and the new 'low prices, always' campaign does just that," a Woolworths spokesman said.

"It tells our customers than on hundreds of products across our stores they can expect the same low prices - week-in, week-out, the prices will be remaining at the low price."

Proving that little is new in the world of marketing, Woolworths' latest campaign echoes Coles' Low prices everyday message and borrows from KMart's seven-year-old Always Low Prices ads.

The new campaign will run in conjunction with Woolworths' Prices Dropped campaign, which highlights the impact of recent price reductions on the cost of an average weekly grocery shop.

As reported in The Australian Financial Review last month, Woolworths was forced to tweak the Prices Dropped ads after global research firm Nielsen refused to endorse Woolworths' claims that its prices were cheaper than Coles'.

Woolworths will also continue to air its iconic Fresh Food People campaign, along with Red Spot specials.

Mr Banducci, Woolworths' Food Group managing director, said in August that Woolworths' marketing strategy would slowly evolve but the key themes - fresh food and cheaper prices - would remain consistent and messages would be more cohesive.

Analysts believe Woolworths' $200 million-plus price investment to date has yet to gain traction with consumers and is likely to have had little impact on same-store sales in the September quarter.

Deutsche Bank expects Woolworths' same-store food and liquor sales to fall 0.5 per cent in the three months ending September after falling 0.9 per cent in the June quarter. Credit Suisse expects same-store sales to fall 0.8 per cent.

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John Newton
20/10/2015 5:27:31 AM

Low prices and screw the farmers. SAnd one more thing. How come they're more expensive than my local greengrocer, the best in Sydney?


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