Differentiation

Since I am in the grocery business, I have found that a couple of truths. People will always buy food and grocery stores will have to come up with more innovative ways to get those people into their markets. My company, Giant Eagle, is grocery chain that has five brands over 270 stores and 170 gas stations in four states headquartered in Pittsburgh PA. I currently work for the Market District brand which is our upscale and flagship stores. One of our direct competitors over the past couple of years has been Whole Foods. Although Whole Foods does not carry many of the items that we do, they have taken a large bite out of organic and natural foods.

            Giant Eagle at one time was a force on social media especially in the western Pennsylvania and Eastern Ohio markets. In 2011, Supermarket News, voted Lisa Henriksen, then VP of Marketing and Own Brands, as Marketer of the Year for 2011. At that time, Giant Eagle had a promotion called Food Perks and Fuel Perks in which customers who had an Advantage Card could accumulate money off their food and gas purchases. The social media campaign used the tag line, “That’s My Giant Eagle” advantage. Customers and employees would post videos stating how they used their perks and saved money and finished the video with the tag line. However, since then, the social media presence has dropped to just some informational posts, promotions and questions for the customers such as, “Do you prefer crunchy or creamy peanut butter?”. Very recently, each market district has gotten their own Twitter and Facebook accounts. Although they are only weeks old, the followers have been increasing rapidly due to promotion within other Giant Eagle site and within the stores themselves.

            Whole Foods, on the other hand, are probably have over 1.75 Twitter members and over 600 individual accounts including each store having their own Twitter and Facebook accounts. Whereas Giant Eagle utilizes their social media for getting information out and getting people to discuss their “foodie” preferences, 85% of Whole Foods responses to Tweets are responses to customers comments. They strategy is to keep their customer informed and be accessible for questions, comments and concerns that they customer has. They know their market is a more educated, younger conservative crowd who wants to be knowledgeable than entertained, so their concentrate more on the Twitter than Facebook medias.

            Whole Foods CEO, John Mackey, is one of the very few CEOs that writes and manages their own blog site. And, he can be quite outspoken. This has caused a backlash of negative posts on their social media sites. However, Whole Foods, being quick to respond to any posts including the negative, they can usually head off any major negative media backlash. Giant Eagle did not fair so well earlier this year when they decided to end the Food Perks in lieu of another food promotion. The reasoning that Giant Eagle posted was that the customers did not utilize the food perks to its fullest potential and that it was too difficult to use. This caused a major uproar from insulted customers who took offense to being told that they were not smart enough to use the foodperks. Giant Eagle did not handle the response well. In fact, they did not respond much at all. To make matters worse, the replacement coupon based marketing plan was delayed by over three weeks, thus continuing the negative campaign. For the past three months, Giant Eagle sales have been lower than the year’s numbers by a companywide 3%.

            Giant Eagle can learn much from Whole Foods and it seems that they have decided to do more with social media as part of their major marketing campaign. How will it work out? We will have to wait and see.

 

 

References

 

Hamstra, Mark (Jan 24, 2011), Advantage: Giant Eagle’s Lisa Henriksen, SuperMarketNews.com, http://supermarketnews.com/marketing/advantage-giant-eagles-lisa-henriksen

 

Carr, David (September 6, 2012), How Wholefoods Handles Social Media, Informationweek.com, http://www.informationweek.com/social-business/social_media_monitoring/how-whole-foods-handles-social-media/240006793

 

Friedman, Brad (August 4, 2011), Whole Foods Market’s Subtle Social Media marketing Plan, SocialMediaToday.com, http://socialmediatoday.com/bradfriedman/326139/whole-foods-market-s-subtle-social-media-marketing-plan

 

Giant Eagle Dumps FoodPerks (Feb 4 2013), Progressivegrocery.com, http://www.progressivegrocer.com/top-stories/headlines/industry-intelligence/id37268/giant-eagle-dumps-foodperks/

 

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One thought on “Differentiation

  1. There will always be negative backlash when something that paying customers like/love is discontinued. Those that used the Food Perks may feel slighted that a program they enjoyed is ending even if they are the (vocal) minority and social media is the place to voice that unhappiness. Not responding to these comments and concerns was a very bad move on Giant Eagle’s part as they should have used that opportunity to educate their customers on why Food Perks was discontinued and what it was being replaced with to jump start that program.

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