Reed Super Market A New Wave of Competitors

Reed Super Market A New Wave of Competitors Mahesh Amarasiri, MBA, FCMA, ACIM, B. Sc( Eng)

Abstract Reed Supermarkets is a high-end supermarket chain with operations in several Midwestern states. Meredith Collins, vice president of marketing, visits stores located in Columbus, Ohio, an important region with the largest market and the greatest impact on revenue growth. She is concerned about increased competition from dollar stores and limited-assortment stores offering very low, appealing price points. Reed's market research shows that as a result of the economic downturn, customer loyalty is dwindling and consumers are willing to go to multiple stores to get the best deals. The management have diverse views on the options in hand

Options in Hand Collins must decide whether to change the current marketing and positioning plan in an effort to increase market share to meet challenging corporate targets. Her options include retreating from price competition and focusing on quality or embracing more private-label brands and competing more aggressively on price. She can also maintain the current positioning and appeal to customers looking for a quality shopping experience.

Problem in Hand Grow Market Share from 14% to 16% amidst declining trend Arrest threat from Competition Slow down in the retail market in US Positioning in Customers Mind

Suggested Approach Overview Analysis of Problem in Hand Competitor Analysis/Positioning SWOT Analysis Evaluation Options in Hand Recommendations

Strategic Tools SWOT Competitor Analysis/Mapping Evaluation of Options

Suggested Answer

Overview Reed Supermarkets is a high-end supermarket chain with operations in several Midwestern states. Meredith Collins, vice president of marketing, visits stores located in Columbus, Ohio, an important region with the largest market and the greatest impact on revenue growth. She is concerned about increased competition from dollar stores and limited-assortment stores offering very low, appealing price points. Reed's market research shows that as a result of the economic downturn, customer loyalty is dwindling and consumers are willing to go to multiple stores to get the best deals.

Overview Collins must decide whether to change the current marketing and positioning plan in an effort to increase market share to meet challenging corporate targets. Her options include retreating from price competition and focusing on quality or embracing more private-label brands and competing more aggressively on price. She can also maintain the current positioning and appeal to customers looking for a quality shopping experience.

Problem in Hand Grow Market Share from 14% to 16% amidst declining trend Arrest threat from Competition Slow down in the retail market in US Positioning in Customers Mind

Options in Hand Continue with dollar special program Continue with everyday low price program Overall price reduction Expand private label and health range

SWOT Analysis Strength • Convenience • Private Label • Positioning for Quality Weaknesses • Low Margins Opportunities • Increase Private Labels • Prepared Food • Pet Food Threats • Dollar Stores • Warehouse • Super Centre

Industry Analysis ( Porters Five Forces) Threat of New Entrants Customer Bargaining Power Bargaining power of the supplier Threat of Substitutes Rivalry among the existing players • Dollar Stores • Warehouses • Customers tend to move to the best offer instead of convenience • Different shopping formats for customers • Increase private Labels • Different shopping formats are in place for the customers needs • Many promotional programs are in place in the industry in order get the share of wallet

Competitor Analysis

Positioning MAP

Options in Hand

Recommendations