MARKETING CASE English version - Case written by the company - REFAEC
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
MARKETING CASE
English version
Case written by the company
THE QUEBEC FOOD INDUSTRY In an industry such as the food industry, competition is fierce. Many key factors come into account in order to insure the daily success of the different major food banners in Quebec which are positioned primarily along two major axes. You will find conventional grocery stores such as IGA, Metro and Provigo. These food chains are doing very well for themselves due to enhanced shopping experiences. They rely on offering a vast range of products including exclusive products in a well-maintained store with the help of professionals who are qualified and attentive to their customers. Although pricing does remain a very important factor for the client. Even though they are so-called conventional banners, they are, none the less, aggressive in their pricings so as not to have excessive price differences with large discounters. On the other side, there are the discounter type stores (100% food and Mass merchandizing oriented). Amongst them, there are Super C, Maxi and Walmart Super Center. These food chains offer a simplified shopping experience, a reduced in store service, less innovation and a limited offer of products. Everything has been put into place to offer the lowest prices and the best market value. The value and prices are thus the success factors of these stores. Also making the cut to this category is Costco, a warehouse type-detailing store that offers annual memberships that allow consumers to purchase high quality products in economical formats and allows short-term seasonal discoveries throughout the store. Furthermore, distributors qualified as ‘’Off-Sector’’ are making their name more and more in the heart of the food distribution industry. They principally consist of discount stores (i.e. Giant Tigre), pharmacies (i.e. Jean Coutu, Shoppers Drug Mart), one-price stores (i.e. Dollarama) and specialised stores associated to certain cultural communities (i.e. Marché Adonis). Although their share of the food market sector remains quite low, these stores are making sales that decrease the average value of the basket of conventional and discounter stores. In the upcoming years, we are also anticipating the advent of online giants such as Amazon who will certainly have an impact on the way consumers buy their food. Jeux du Commerce 2018 Marketing Case 2
THE ‘’SUPER C’’ CASE
Leader in the discount store segment in Quebec, Super C is part of the large METRO INC.
family since 1987, while Metro Richelieu Inc. was buying 12 stores ran by ‘’la Ferme
Carnaval’’. Four years later, they changed their denomination from ‘’la Ferme Carnaval’’ to
‘’Super C’’. The ‘’Super C’’ formula is then improved according to the needs of the customers
by taking the position of a discount chain.
In 1992, Metro Richelieu Inc made the acquisition of many Steinberg stores and transformed
a dozen into Super C stores. Since 1996, Super C continues to expand its number of
locations by building new sites in strategic locations in order to expand its clientele.
As of today, with its 97 locations, averaging 43 000 square feet in size, Super C is
established in all the major urban centers of Quebec.
SOME OF SUPER C’S FEATURES
• Super C is the first discount banner in Quebec to launch its mobile application. It
allows users to view their flyers, access exclusive coupons and build their grocery list.
This mobile application as seen success with more than 76 000 downloads to this
day.
• Super C also holds 31 000 subscribers to its newsletter. This allows Super C to
highlight specials and offers as well as quickly communicate messages to their
subscribers.
• Super C offers two private brands: Selection and Irresistible. Moreover, the
penetration rate of private brands at Super C is superior to all banners in Quebec.
• Surveys conducted to our clients and competitors teach us that Super C is perceived
as a quality and value-focused brand, especially when it comes to fresh goods. In
addition, it comes first amongst the discounters for the perceived freshness of its
fruits and vegetables. It also surpasses other discounters and even some
conventional stores on the perceived quality of its meat.
• From the point of view of price perception by their main customers, Super C
dominates as the banner offering the best specials. Maxi, Walmart and Costco,
Jeux du Commerce 2018
Marketing Case 3
however, are gaining ground on this point. As for the perception of being the
lowest-priced banner, Maxi and Walmart beat Super C with their respective major
customers. Their policy that consists in equalizing the prices of competitors upon
presentation of evidence is most likely related to this issue.
THE EVOLUTION OF THE CONSUMERS’ HABITS
The price of food has become one of the major concerns of Quebec citizens. A large
proportion (75%) choose groceries as a budget item to reduce their household’s expenses
and this results in the purchase of private labels, large formats or cheaper brands. (Nielsen
Homescan, 2016 Economic Impact Survey).
For the last 10 years, these preoccupations have encouraged a shift from conventional store
customers towards the discounters. The majority of consumers (69%) say that they have
been to both a conventional store and a discounter in the last month. This proportion was
only 51% 10 years ago. Super C has therefore benefited greatly from this trend in recent
years and its sales and market share have increased considerably.
Since the end of 2016, Quebec has been going through a deflation phase. Prices are lower
everywhere and we notice that Super C’s customers are not as faithful as before. A recent
study has shown that currently, price sensitive consumers are the most unfaithful (an
unfaithful customer is one who shops in several banners). Super C is experiencing a growth
in the number of transactions of mid-range and high-end segments, which suggests that
they are still wining a few conventional customers. On the other hand, typical discounter,
price-sensitive customers now seem to be completing more of their purchases in other
stores, mainly Costco, Maxi and Wal-Mart. Without having abandoned Super C completely,
some customers visit those stores less frequently. This trend seems to be present
throughout the food industry since the average number of annual visits per household in
Quebec has decreased from 30.3 in 2015 to 28.9 in early 2017 (Nielsen Homescan
(GRTrends), Quebec Shopper, Total Outlets, Opportunities, Rolling 12 week periods ending
June 24th 2017). This represents a reduction in opportunities to convert consumers.
Jeux du Commerce 2018
Marketing Case 4
AN OPPORTUNITY TO SEIZE: MILLENNIALS
We have evaluated that, by 2020, Millennials will outnumber baby-boomers (26% vs. 24%
for Boomers). Super C is the most popular food banner attracting the greatest number of
Millennials with kids compared to its current customer base (index of 123). This group
therefore represents a great potential for Super C.
Millennials customer profile:
• 41% of them do not possess home phones and depend on their cellphones to
communicate.
• 31% make enough money to lead the lifestyle that they opt for.
• 56% believe that technology helps people use their time in an efficient manner.
Therefore, they are strongly inclined to shop online and consume online media for
example.
• 27% are self-employed.
• 80% sleep with their cellphones next to their bed.
• They send an average of 20 text messages per day.
The purchasing behavior of Millennials is different from that of their parents, the Boomers.
We note amongst other things:
• They show the lowest rate of visits to food stores (but they are the ones who go to
restaurants the most – 51% eat outside their home at least once a week).
• In comparison to Boomers, they have bigger shopping baskets and shop more on
weekends and after 3PM.
• They are price sensitive; they are always looking for the lowest prices.
• They are not loyal towards specific brands and show a stronger tendency to purchase
private brands.
• They are also not loyal towards specific stores.
• They are more inclined to purchase meal solution kits.
• Compared to other generations, they are the ones who eat the least at home with
family for dinner and who eat take out food the most.
Jeux du Commerce 2018
Marketing Case 5
YOUR MANDATE
The food market industry in Quebec is more competitive than ever and represent many
challenges for the upcoming years. Super C’s management team wants to attract new
customers to its stores and retain loyal customers (customers who regularly shop at the
same banner).
More specifically, our goals in this project are to:
• Recruit clients from the Millennial Generation without alienating the current base of
customers;
• Retain these customers and encourage loyalty for years to come while adding to the
value of their grocery-shopping cart.
Your mandate consists in:
• Analyzing the current positioning of Super C and emit your vision on opportunities
of differentiation in order to make Super C the banner that best meets the needs
and aspirations of the Millennials.
• Developing a strategic plan that you would recommend in order to achieve this
position and attain Super C’s goals.
Here are some leads to explore during your strategic thinking:
• How to take advantage of the mobile application and how to make it further evolve?
• How to take advantage of Super C’s private brands (Selection and Irresistibles)?
• What might an online business model look like for a discounter?
• Other suggested ways?
Your recommendation must respect the following characteristics:
• Promoting behaviors that are profitable for the banner and respect the operational
imperatives of a discount banner. Any suggestion that would involve an increase in
services, exterior or interior design or decorations, and other in-store activities, must
therefore be analyzed from an operational point of view in order to ensure that it
does not imply a too high increase in operational costs.
• Being able to start implementation in a maximum of 12 months after the acceptation
of the mandate.
Jeux du Commerce 2018
Marketing Case 6
Super C’s management team is expecting that you be creative, that you direct your thoughts towards innovative and easily applicable ideas and that you will think beyond the simple advertising strategy. Jeux du Commerce 2018 Marketing Case 7
APPENDIX A – SUPER C’S MISSION Jeux du Commerce 2018 Marketing Case 8
APPENDIX B – THE CANADIAN FOOD INDUSTRY
APPENDIX C – LESS CHANCES TO CONVERT
HOUSEHOLDS, ESPECIALLY IN QUEBEC AND
ONTARIO
Sources: Nielsen Homescan (GRTrends), Quebec Shopper, Total Outlets, Occasions, Rolling 12 week periods ending June 24th 2017.
Nielsen Homescan (Enhanced Demo), National All Channels 52 weeks ending April 19, 2016
Jeux du Commerce 2018
Marketing Case 9
APPENDIX D - INTERPENETRATING GROWTH IN
QUEBEC
FORMAT MARKET SHARE EVOLUTION
(% of all channel)
65%
60.5%
60% 56.6%
55% 52.1%
50…
50% 47.9%
49.7%
43.4%
45%
39.5%
40%
35%
Conventionnel Discount
Sources: 2006 à 2011: Industry Tracker, SOM. / 2011 à 2013: Industry tracker, TNS. / 2015 à 2016: Tracker consommateurs,
SOM. Note: Costco est inclus dans « conventionnel » // Nielsen, Cross Outlet Facts, 52 weeks ending April 1, 2017
Jeux du Commerce 2018
Marketing Case 10APPENDIX E - MILLENNIALS: NEW CONSUMERS
THE LOYALTY CHALLENGE
• Millennials do less shopping
trips
• They tend to buy more private
labels
• They are price-sensitive; it’s
the first thing they look for
• Millennials are not loyal
to stores; they are always
looking for the lowest
prices
• They are also not
brand loyal; they
can be easily
persuaded
to buy a
different
brand
Sources: Nielsen, #millennialtalk (Statistique Canada)// HH National All Channels 52 weeks ending April 19, 2016
Jeux du Commerce 2018
Marketing Case 11APPENDIX F – SUPER C: EXTERIOR APPENDIX G – SUPER C: FRUIT AND VEGETABLES DEPARTMENT Jeux du Commerce 2018 Marketing Case 12
APPENDIX H - SUPER C: MEAT DEPARTMENT APPENDIX I - SUPER C: DRIED GOODS DEPARTMENT Jeux du Commerce 2018 Marketing Case 13
APPENDIX J – MOBILE APPLICATION Jeux du Commerce 2018 Marketing Case 14
APPENDIX K – SUPER C NEWSLETTER Jeux du Commerce 2018 Marketing Case 15
APPENDIX L – FACEBOOK PAGE Jeux du Commerce 2018 Marketing Case 16
You can also read
