FLYER FEVER
IN THE STRUGGLE TO WIN THE VICTORIA DAY SHOPPER, GROCERY CHAINS STRATEGIZE IN WAR ROOMS TO PRODUCE THE FLYER TO BEAT THEM ALL. SO WHERE’S THE BEEF?
TORONTO • Nineteen weeks ago, Loblaw Cos. Inc. decided to go with striploin steaks on the front page of its Victoria Day flyer. It was one of the more important decisions the flyer team will make this year.
Supermarket chains in Canada have been agonizing for weeks about their big meat sales for the unofficial kickoff to summer.
Victoria Day shopping lists are considered among the biggest and most coveted in the Canadian grocery sector, more so than any other holiday, save maybe Christmas and Thanksgiving. People are opening cottages, going to parties and hosting barbecues. If a customer is lured into a store for a marquee meat promotion, grocers are banking on them staying to buy the rest of their list: stock-ups for cottage cupboards, ketchup- mustard- relish packs, ice cream, frozen burgers, hot dogs, pop and lots of cheese.
“We don’t want them to come in and grab the steaks and leave,” said Wes Brown, Loblaw’s vice- president of marketing. “We want their full shop.”
The competition is so intense that grocers talk about losing out to a rival’s sale as if they were being killed. At Loblaw, if a competitor’s flyer has a better sale price on a similar item, employees refer to the disho.
One former Canadian grocery executive had another term for it: “It’s called getting clipped,” she said. “That is the stuff of retailer nightmares. So, yes, we spend hours sitting around thinking, ‘ What are our competitors going to do?’”
The flyer team at Loblaw — an interdepartmental council of marketers, supply chain analysts, operations specialists and data experts — started meeting about the Victoria Day weekend in November. Each flyer is planned 26 weeks out with the goal being to predict something nearly unpredictable: what people will want in six months.
The team looks at consumer insights and sales data from previous Victoria Days, as well as trends in specific regions. For example, Quebec is apparently partial to lobster on the May holiday weekend ( known as National Patriots’ Day in the province). Consumer behaviour can be volatile and dependent on unknowns, but there are some undeniable grocery flyer truths.
“You always have a protein,” s aid Sharla Paraskevopoulos, senior vice- president of Loblaw market operations. “I have customers and friends ask me all the time, ‘ Why is chicken on the front page?’ Well, chicken is a hot item. Boneless skinless can drive people into the store.”
Kevin Grier, a livestock and meat market analyst in Guelph Ont., pays close attention to supermarket flyers and compiles a weekly report on meat promotions, broken down by region and by retailer.
The emphasis on beef, he said, is based on the grocery philosophy that if there is beef in the cart, there will also be the makings of an entire meal.
“You’re not going to turn your car around for Oreo cookies,” he said.
In the past, the Loblaw flyer team discussed these matters in a designated “flyer room” at headquarters. It was a boardroom papered in old flyers, so everyone could see what Loblaw and its competitors had tried in the past. Now the team mounts a temporary flyer room for weekly meetings, but much of the materials they consider have been digitized.
“It’s not the kind of war room that it used to be,” Paraskevopoulos said.
But she said the stakes remain high. The goal isn’t just to boost Victoria Day sales. The belief among grocers is that if they get it right with customers on the May long weekend, it will set the tone for the rest of the summer.
“It’s like people come out of the woodwork on May 2-4 weekend,” Paraskevopoulos said. “It’s the kickoff for summer ... By winning it, you will get people coming back.”
Through weeks of discussion this winter, Loblaw’s team settled on a barbecue motif for the front page of its flyer. In the Toronto area, the Loblaw-brand store flyer includes chicken breast for $ 3.99/pound, burger packs for $ 10, corn for 37 cents a cob. But the top spot — the star — is bone-in, AAA striploin steak for $5.77/pound.
“We feel great about this steak in the top block,” Brown, t he marketing vice- president, said this week. But until their competitors’ flyers came out mid-week, it was impossible to know if they’d won, or if they had been taken out.
“But again, anything can happen, from weather, or a mood, or something that changes,” he said.
Some supermarkets set out roles for each item on the front page. One item is designed to drive traffic to stores — on which grocers will sometimes take a loss — while another item is designed to drive profit.
Grocers expect a certain amount of sales and tonnage depending on where an item is slotted in the flyer. If an ad or item does not do well one week, Loblaw will tweak future flyers in an attempt to make up the difference.
Metro Inc. declined to comment about its flyer strategy “after careful consideration,” saying it involved sensitive information. Sobeys Inc. did not fulfil interview requests.
At Loblaw, Paraskevopoulos receives a bundle of flyers from competitors a few days before they’re distributed on Thursday.
“I lay them all out on my desk,” she said, “I’m looking immediately at who’s got what ... who’s got the hot ad.”
In the Greater Toronto Area this weekend, Walmart has rib steaks for $ 5.97 a pound, corn at 33 cents a cob and Heinz’s ketchup- mustard- relish packs for $ 3.47. Sobeys went with $ 9.99/ pound beef tenderloin and Beyond Meat burgers at the top, while Metro featured $6.88/pound T-bone steaks.
On Wednesday, with Victoria Day flyers already appearing online, Grier, the meat analyst, seemed impressed by a “big beef” weekend. “Metro had the T-bones, you saw that? That’s all right, you know. I mean, striploin is better than a T- bone, generally,” he said. “Sobeys had a good tenderloin on there — $ 9.99 for a tender? That’s darn good.”
But Walmart’s offer of $5.97 bone-in rib steaks — “a very good price” — seemed to impress him most, just as much as Loblaw’s striploins.
“So who won? I don’t know, it’s between Loblaw and Walmart,” he said. “Why don’t we call it a photo finish?”