Reed Supermarkets: a New Wave of Competitors Essay

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MBAD 6171‐U90 Reed Supermarkets Spring 2013 Meredith Collins faces the problem of choosing the most appropriate marketing strategy for Reed Supermarkets to implement so that the company increases its market share in the Columbus, OH market from 14% in 2010 to a target of 16% in 2011. This goal should be accomplished in spite of the new competitive challenges posed by the rising prominence of dollar and limited selection stores in the food retailing industry. SWOT Analysis Internal Strengths 1. Reed’s quality image and exceptionally attentive customer service; 2. Full range offerings; 3. Attractive stores, long hours, and elegant service‐case displays. Internal Weaknesses 1. Many…show more content…
The present “dollar special” campaign was an attempt from Reed’s to change consumer’s perception that they have higher prices. Some Reed’s managers are confident that in another six months they will be able to change this perception while, at the same time, they reinforce customer loyalty. However, some executives believe also that the campaign detracted from Reed’s quality image as it seemed to be too close to the offering of dollar stores which could damage Reed’s image through association. The scope of this campaign (250 out of 50,000 items) does not seem sufficient to generate the additional sales required. Other executives suggest implementing an everyday low pricing model in order to tackle, in a more aggressive fashion, the high‐priced image that Reed carries. This would likely require a complete switch of the company’s positioning from a high‐end store to a medium, more value‐focused positioning. Reed’s image, as a quality and customer service oriented, could be extremely damaged by such a switch. Additionally, it would be expected that other discount stores would be reacting aggressively to this strategy. Another option is to reinforce Reed’s current positioning as a high‐end
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