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Superior Supermarket

Strategic Marketing - Pricing Strategy

Mandy Phan

on 20 November 2012

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Transcript of Superior Supermarket

Mandy Phan
Michael Rudge
Andrew Saccone Superior Supermarket Alternatives Recommendation Key Takeaways Fully implement EDLP strategy
Increase advertising budget by .25% of sales
Must increase market share by 7.5-8% to maintain 2002 level profits Limited EDLP Implementation Do Nothing Does 2 years mark a trend? Could maximize earnings
But inconsistencies would damage consumer trust Everyday Low Price (EDLP) Full implementation, store-wide
Lower prices between 5-10%
Increase advertising budget to grow market share
Current market share Close one store There are 3 stores within two miles
Can changing the market structure help? Fully implement Every Day Low Price strategy
All stores, all products
Lower prices by 7%
Increase advertising budget
Currently .89% of salesIncrease by .25% 1.14% of sales Current Market Share Financial Impact Financial Impact North Fairview opened in Centralia Acquired by Hall Consolidated 1970 2002 Generated over $192.2 million in sales Strength

- Oldest Supermarkets stores in Centralia area
- Convenient locations and accessibility to shoppers
- “Superior Supermarkets = Superior Value”
- High-quality products
- Stores are renovated, clean and convenient for customers Weakness

- Pricing strategy
- Offered limited variety of merchandise than the major competitor in the area
- Low in advertising spending compare to competitor
- Lack of a strong consumer image Opportunity

- Store expansion
- Increased consumer awareness about brand image and prices
- Every day low price strategy
- Allocate capital resource for advertising budget Threat

- Loss of current market share and current customer
- Lower price strategy from competitors
- Inconsistent brand image Threat of new entrants Bargaining power of suppliers Rivalry among existing competitors Bargaining power of buyers Threat of substitution High High Low Moderate/High Moderate Strategic Marketing - Pricing Strategy
Superior Supermarket case 1975
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