Your Money

Shaw’s aims at budget-conscious shopper

11:24 AM EDT on Wednesday, June 24, 2009

By Paul Grimaldi
Journal Staff Writer

EAST PROVIDENCE — Shaw’s Supermarkets, after settling under its latest ownership change, finally is focusing on how the deep recession is affecting New Englanders’ buying habits.

The West Bridgewater, Mass., chain is pushing hard on a number of discount and promotional efforts intended to hang onto, or win back, people who are counting every penny they spend.

“What’s happened in this economy is that price has become much more important” for shoppers, said Bill Nasshan, senior vice president of marketing for Shaw’s.

Earlier this year, Shaw’s began offering customers $20 or $30 of free groceries with the purchase of grocery gift cards worth $250 or $300 as part of a “refund rewards” program.

While walking through the chain’s East Providence store, Nasshan also pointed out a display for the 4:15 Meal Deal promotion, which offers dinner for four for less than $15. Meals rotate biweekly, include one main course and two sides and require about 15 minutes of reheating. The meals are displayed near the stores’ meat section and are highlighted in weekly ads and on its Web site.

Shaw’s also has a deal with Gulf Oil, allowing drivers to swipe the supermarket’s loyalty card at a gasoline station pump to earn reward points.

The moves are part of an effort by Supervalu Inc. to invigorate sales during the recession. In January 2006, Supervalu became the nation’s second-largest supermarket chain when it acquired 1,124 stores, including Shaw’s, in a deal that resulted in the breakup of Albertson’s. Supervalu, of Eden Prairie, Minn., now owns about 2,400 supermarkets across the country.

“The recession only adds to the struggle for Supervalu, as it has to contend with a much more price-conscious shopper,” according to a recent report by retail industry analyst Management Ventures Inc.

Shaw’s parent has promoted higher-margin private-label goods, cut costs and closed weak stores in the last two years months –– including two in Providence and one in Attleboro, Mass.

Continuing that effort, Supervalu put Shaw’s on a “fast track” capital-investment program, and remodeled other locations. The East Providence store replaced one located just a few doors to the east in the same shopping plaza at Pawtucket and Taunton avenues.

Jeff Noddle, executive chairman of Shaw’s parent Supervalu, earlier this year also noted “price investment” will be the key for the company’s stores.

That’s meant managers at Shaw’s Supermarkets and the other Supervalu chains are keen to reduce prices or at least keep them competitive with other grocers in a particular market.

“We took a look at the key items that customers buy most often,” Nasshan said. “We adjust [those] prices as necessary.”

Shaw’s is promoting “locked in” specials –– price cuts on seasonal items that will carry for four months or more. For instance, it has cut prices for the summer on barbeque sauce, hot dogs and paper plates, among other things.

“You still have to provide value to the people,” Nasshan said.

pgrimald@projo.com

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