Sobeys Quebec searching for next hit promotion
Sobeys Quebec has ended two of its most successful marketing promotions. Now the company's marketing experts are focused on finding a fitting encore.
"The bar is set pretty high," said Sobeys Quebec spokesperson Marie-Noëlle Cano. "But I'm confident our merchandising team will come up with something soon that gives added value to our customers, which is always the goal of promotions."
In September, Sobeys ended a decade-long promotion of giving customers a free item for every $70 in purchases.
Under the program, which began in 2007, the company gave away more than 180 million items, everything from crackers and cleaning products to cheese and chocolate.
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That works out to roughly 1.6 million items every month, or 400,000 a week, across Quebec's IGA network of some 300 stores. "It was hugely successful," said Cano. "But like anything else, it ran its course."
She added, however, that a concurrent promotion offered since 2012—offering IGA customers a choice between the free item or coupons for a three cent-per-litre discount on gas at the 205 Shell stations that Sobeys bought in 2011—continues.
So too does Sobeys cross-Canada affiliation with Air Miles. When the free food promotion ended in September, Sobeys Quebec replaced it with a 1970s-style stamp promotion.
Designed by the Montreal-based grocer's marketing team, the promotion offered pots and pans at 5% of their retail value when IGA consumers reached certain levels of collected stamps.
"When it launched we gave it a vintage twist, but we had no idea how our customers would react," recalled Cano. "Some people were quite skeptical when they first heard about it. But it turned out to be a wonderful promotion that was hugely successful."
Cano said consumers rushed to cash in their stamps before the promotion ended in March. However, she declined to say how many pots and pans were sold during the six-month promotion.
La Presse, however, citing unnamed sources, last week reported that 1.2 million units were sold during the promotion. That works out to roughly 5,000 units per week per store.
"It was crazy towards the end," one IGA storeowner reportedly told La Presse. "I was getting $35,000 worth of pots and pans on Friday, and by Monday, I had none left."
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Replacing that promotion is an ongoing one that offers shoppers one chance for every $10 spent to win a weekly draw for a year of free groceries, and a promotion-ending grand prize of free groceries for 25 years.
The grand prize will be drawn in April. After that, Cano said, it will be whatever the merchandising team comes up with.
"They are now evaluating and analyzing promotions using many benchmarks (and) discussions with suppliers," she said. "It's really a team approach."
For retail expert JoAnne Labrecque, developing new grocery store promotions is never an easy task. "The competition is so strong, and customers are not loyal," said Labrecque, an associate professor of marketing at HEC Montréal, and associate member Omer DeSerres Chair of Retailing.
According to Labrecque, Sobeys Quebec hit grand slams with both its free item giveaway and the stamps-for-pots promotion.
"The free item was highly innovative and competitive when it was introduced," she said. "But it lost its edge after so many years, and the competitive landscape has changed."
More generous loyalty programs notably abound now, noted Labrecque.
"To be successful, a new promotion (by Sobeys Quebec) will have to offer people as much and be original," she said. "It's not an easy task."