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Second View Analysis for

Superior Supermarkets
[Company Name]

Date: May,17 2011 Name: Lili He Mkt 359 Professor Kuehl

CASE STUDY WORKSHEET AND TEMPLATE

Second View
Problem Statement: Primary: Superior Supermarkets is a company that is in dire needs of improvement in terms of pricing and advertising. Based on this specific case, Superior Supermarkets motto is Superior Supermarkets = Superior Value. The price has been questioned given the perceived higher grocery, meat, and produce prices. Currently, Superior Supermarkets biggest competitor is Harrisons due to the reason that they have the lowest everyday prices overall compare to other supermarkets. According to a recent telephone poll of 400 Centralia residents, more than 30 percent of interviewees confirmed that the prices of Superior Supermarkets are above average. In this case, it is a contradiction to their motto since there are anything but superior. From the data gathered from the Association of Store Characteristics with Major Food Stores in Centralia, Superior has the lowest percentage of Most Reasonable prices compare to others. Moreover, in accordance to comparison in using market-basket studies of supermarket competitors, Superior is the highestpriced food store in the Centralia area. The company has become the loss leader in terms of decreasing sales of items such as soft drinks, bread, eggs, and flour in the Centralia market. Based on the memo from Randall Johnson, the loss is due to the high prices. Superior Supermarket could lose their market share in Centralia see that sales are already down 3 percent in the first quarter of 2003. Secondary Issues: This Company has issues in variety as well. Superior Supermarkets have the lowest percentage on Widest variety of produce. In this case, produce is a major store enticement and patronage determinant. Consumers have complained about out-of-stock situations in private labels also need to be improved. Recommended Action (What plan of action do you recommend? Explain in detail why you make this recommendation. What are the pros and cons to your recommendation?)

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CASE STUDY WORKSHEET AND TEMPLATE

My recommendation for Superior Supermarkets is that the company should change their motto from Superior Value to Superior Quality. As found through the data from Association of Store Characteristics with Major Food Stores in Centralia, Superior Supermarket is the second supermarket that has high percentage in best service, and is the leader in the characteristic of Most Convenient compared to others supermarket. Case shows that appearance and cleanliness, friendliness, service, and convenient to home or work were liked most by shoppers. Since service and quality are already parts of the main selling point to consumer, Superior should use this as their advantage instead of pushing to have the best prices on the market. Once again, Superior Supermarkets dont have to start or participate in a price war in the market. The company shall be successful as long as Superior focuses more on the big concept of convenience. The pro of the recommendation are if focuses are on convenience instead on price, it could attract more consumers that seek convenience since it was ranked the fourth most considered factor in store choice and patronage. The con of the recommendation is of course the price, since it is the most important store choice determinant based on research. Superiors biggest competitor Harrisons is the winner by having the best overall prices. If Superior wants to attract more consumers, the company needs to focus on their attention on convenience. Not to mention, Superior has to improve their produce quality in order to stay in the high price range and maintain consumer loyalty Also, the company needs to avoid instances of out-of-stock. According to the third study from 587 Superior customers at the three store sites, consumers responded and complained that the out-of-stock situation in private labels needs to be improved and the quality of produce needs to be enhanced. Superior needs to keep in mind that consumers shop for food twice a week on average and they usually shop at more than one store on a regular basis. Which mean if Superior Supermarket dont take immediately actions by resolving out-of-stock issue, it will prevent consumers for coming back. The pro of the recommendation is that it will bring loyal customers back to the store. There is a high probability that consumers will be willing to give up price over convenience if Superior refines all the mentioned issues that drive buyers away. The number one con is the fact that their biggest competitor Harrisons always have the lowest price in town, it might not be a big enough motivation for consumers to give up Harrisons for Superior. Marketing Plan to Support recommendation
A. Target Market(s):[Who and why are we targeting? Provide a detailed

profile of our target]

In this case, Superior should target on the age category between 25 to 34 years old (13.8%) and 19 years and under (29.6%). As for the household income distribution, company should focus on the $50,000-$74,999 bracket (19.8%) based on Centralia Population profile. According to the case, superiors biggest competitors focus on middle and upper-income groups that have annual income of $40,000. For superior, it would be better to target different market demographics. I had chosen 3 target markets because Superior could focus on different groups in three different locations, from South Prospect Street, West Main Street to North Fairview Street. One location should focus on kids and teenagers, which allows
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CASE STUDY WORKSHEET AND TEMPLATE

parents to shop more conveniently when they bring their children to shop or shop for their kid. In the instance of Superiors goods, supermarkets should focus on and provide more goods for young consumers, such as groceries that is targeting childrens health. The other Superior store should focus on the $50,000-$74,999 annual income category, and age between 25 to 34 years old. The company should provide high quality meat and produce especially on quality of meat, since meat is the second- most important determinant of store choice. These two groups of segments are all about having healthy lifestyles and willing to spend more money price if supermarket have better meat and produce quality.
B. Marketing Mix:

Product Strategy As mentioned, the case shows private brand of produce are usually out-of-stock, Superior always low on the supply of produce that consumer are looking for. In any instances, Superior supermarket should always provide enough produce for consumer. Superior should provide better meat quality in comparison to their competitors in terms of great cuts and cleanliness in the meat department.
Price Strategy

Superiors price should stay the same since the company is now focusing on the quality of goods rather than price. It would not be wise if Superior were to compete with Harrisons, a company known for their lowest price. Distribution/Place Distribution is the biggest advantage and strategy in Superior supermarket. Compared to Harrisons, Superior should focus on North Fairview Street and have more promotions to attract consumers to the area. Since Harrisons have yet to expand at that location, Superior will have a bigger potential for market growth. Advertising and Promotion Superior Supermarkets need to change their marketing motto from superior value to superior quality. The company should advertise by TV commercials and newspapers to widely spread the message that Superior is about quality over price.

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