Grocery prices are in the news yet again. Over the past two days, two new stories caught my eye: Crain’s Chicago Business’ “Dominick’s discount program adds ammo in price war” and Bloomberg’s “Wal-Mart’s Prices Rise to Highest in Almost Two Years.”
A few excerpts from both:
Dominick’s new digital discount program has an aim other than saving customers cash. It could be the grocer’s most powerful weapon yet in a brutal pricing war with its mass-merchant and club-store rivals. And the grocer is willing to trade profits on some items if it means winning back a place in shoppers’ carts… Dominick’s program, dubbed Just for U, offers shoppers personalized savings on items they’ve purchased in the past…
Dominick’s can analyze purchases made with the chain’s loyalty card and spot missed sales opportunities. For example, a regular shopper might buy baby food and formula, but not diapers. The system will assume that the shopper is getting diapers elsewhere and will automatically offer a deal that beats the competition.
“Chicago is a highly competitive market where customers tend to shop in more than one place,” Dominick’s Division President Don Keprta said in an interview. “The crux is to get you what you want and make sure you get it from us.”
And…
Wal-Mart Stores Inc.’s prices rose in September to the highest level in at least 21 months, according to JPMorgan Chase & Co., as the world’s largest retailer scaled back discounts from earlier this year. Prices for produce climbed as Wal-Mart offered almost no discounts on food last month, Grom said. Price cuts on items such as cereal and ketchup failed to attract as many consumers as Wal-Mart anticipated, dragging down sales in the latest quarter, U.S. stores chief William Simon said last month.
This is such an interesting move for Dominick’s in that they’re targeting shoppers who are shopping around on price (which is all of us.) If you are a Dominick’s shopper and have logged into Just For U, you’ve likely noticed that the prices it’s showing you for the items it deems you buy frequently look similar to the discount shown here at right — for many of their discounts, Dominick’s is using the Wal-Mart “everyday low price” as their benchmark for the sale price they’re giving to you, dipping a bit underneath that price.
And, of course, you can still use manufacturer coupons to lower these prices even further. It’s smart on Dominick’s part to go after Wal-Mart in this way, because most (non-coupon) shoppers tend to believe Wal-Mart is the cheapest because “they say they are.” Now, with proof that Wal-Mart’s prices are on the rise, their shoppers may start to look elsewhere — and with Chicgao being such a “highly-competitive market,” as Crains rightfully noted, people have a lot of options on where to shop. Dominick’s is trying to make that price-comparison as easy as possible for their shoppers — on products, based on their past purchase histories, that they are already buying.
Crstny says
Thank you for taking the time to post these articles. I rarely even have time to scan the week day papers, much less read them! You help point me in the right direction. Very interesting and worth reading!
Shirley says
The current prices under “My personalized offer” are compared with Target.
Kluskclark3 says
I stopped off at walmart this past week and picked up a few groceries because i didn’t find all i needed on sale elsewhere and ended up spending $20 there. Way more than i spent at the other stores and using coupons.. I haven’t really shopped there at all since I started couponing!
Bernard2003 says
I find this interesting because if Wal-Mart has raised their prices than Dominick’s may have raised some of their prices so that our “personalized” prices SEEM better… when in fact Dominick’s prices have risen as well. I was looking at a lot of my personalized sales and they don’t seem like very good sale prices to me.
I did see on MashupMom’s website that some folks were getting both the sale discount and their personal offer discount off some items – if that is how the program was intended to work, then that might be a better deal. However, I’m not sure that is how the program was meant to work.
I think it would better to see their offers compared to Jewel prices, but that is just my opinion. Having some kind of price comparison to Target is a good start.
cg1 says
Is this lower than the shelf sticker price for other card users?
dancingwolves says
went early this morning on way to work to pick up a few deals at Dominicks. If I hand’t read the blog it wouldn’t have catch my attention. But as the cashier was scanning my order, he was asking me questions if I shopped at Walmart? I answered him no and he asked further questions as to why I didn’t.
What really struck me is all of the grief we had in Dominick’s training employees on their own coupon policy and now they are very active in the cashier’s developing a sense of surveying customers and their shopping habits…it is refreshing if they see it all the way through.