Fri March 9, 2012
Wal-Mart Ads Targets Regional Grocer Harris Teeter
Originally published on Tue March 13, 2012 12:31 pm
STEVE INSKEEP, HOST:
NPR's business news starts with a surprising ad campaign from Wal-Mart.
(SOUNDBITE OF MUSIC)
INSKEEP: OK. Charlotte, North Carolina, is the scene of Wal-Mart's latest ad. The commercials here are unusual because they mention a competitor - a small, regional grocery chain - by name.
As Scott Graf of member station WFAE reports, Wal-Mart says it's the first time it's ever done this.
SCOTT GRAF, BYLINE: One of the commercials goes like this:
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UNIDENTIFIED ANNOUNCER: Here at Wal-Mart with Amy, a Harris Teeter shopper. We have her last grocery receipt. We're going to go buy the same stuff and see the difference. Let's shop. Strawberries...
GRAF: The shopper ends up buying all the same things, and saving about 10 percent over North Carolina-based Harris Teeter. The commercial highlights price differences at the world's largest retailer, compared to those at the 207th largest.
David Livingston is a Wisconsin-based grocery analyst.
DAVID LIVINGSTON: What's someone going to do to fight back? When your prices are 15, 20 percent below your competitor, what can your competitor do at that point - especially in a weaker economy?
GRAF: So what is a small chain like Harris Teeter to do? The company declined to be interviewed. But Jared Hansen, a professor at the University of North Carolina, Charlotte - who used to work in marketing for Wal-Mart - says chains that have higher prices than Wal-Mart shouldn't concentrate on cost.
JARED HANSEN: Keep focusing on the quality they're offering. The customer service, the cleanliness of its stores, the relationships it has within the community. And that's what's going to keep them going. Because there will always be people who will shop Wal-Mart because of the cost, who will shop Harris Teeter because of the quality.
GRAF: Wal-Mart says it plans more commercials like those in Charlotte, in other markets soon. The company hasn't said where or when those ads will begin.
For NPR News, I'm Scott Graf in Charlotte. Transcript provided by NPR, Copyright NPR.