Reed Super Market

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Reed Super Market

No.Topics Covered Y/N
1Market based asset Y
2Marketing Intelligence Y
3Buying Behaviour Y
4Segmentation Y
5Positioning Y
6Product segment Y
7Marketing Communication Y
8Price Y
9Distribution N
10B2BN

1.Reed’s mission statement:

2.Reeds Value Proposition:

3.Aim / Goal:

1.Evaluate the position of Reed and recommend marketing mix.

Reed’s Heritage

Reed Supermarkets was established in 1939 by William H. Reed.

Opened his first grocery store in Kalamazoo, Michigan.
25 operating stores in Michigan and Illinois by 1960
Reed had purchased two medium-sized chains serving Ohio, Indiana, and Wisconsin by 1980 •The firm had grown to encompass 192 retail stores, two regional distribution centres, and 21,000 employees in five states in the Midwestern United States. • Reed started as a lower-end retailer 80 years ago, it had continually expanded and upgraded its stores, adding new departments and expanding higher-margin offerings like prepared foods and flowers. •For two decades, Reed stores had been considered high-end in the supermarket business.

Company Overview / Profile

Moved from low end to High end.
Overall growth (1-2%) per annum in revenues over a decade. •High end supermarket
Vast range of product
High quality emphasis on Organic products
High quality of customer service
25 stores in metro region

Reed had worked hard to maintain margin over the past decade by adding specialty items, widening the selection of higher-end prepared foods (e.g., salmon fillet with crab stuffing), increasing the private label mix, and using weekly promotional specials to drive traffic.

Declining in Columbus (-0.05%)
Superior service
Brand Understanding
Conflicting views among the executives might have an adverse impact on delivery of the brand promise. oCEO has a very clear understanding

Reed’s basis of success for last 2 decades?: ( reference lenovo )

Challenges?

Marketing Issues?

Current Market Segments?

Brand Positioning?

Brand options / branding strategy?

Brand attributes? ( local supermarket,

Marketing Intelligence/ Marketing Research?

Execution of the marketing research/intelligence?

Customer Value?

Strategy? Options? (What strategy and why?) Support with documentation?

Table 1;
In 2010 ( for average American household )
(Columbus 2010 median household income is slightly higher than national median) The average American household annual grocery spent$5,200.00 Weekly supermarket Trips2.1

So,Total supermarket trips in a year (52 weeks)109.20
Hence,Average spent per trip (A)$47.62

Note: Reeds current average sales value per transaction or per visit (B)$31.48(i.e. 66.11% of (A)) (This is still 18% more than national supermarket average) Potential % increase in the current transaction cost for Reed51.27% How to achieve this??

Difference between Customers average spent per trip LESS Reeds average transaction i.e. (A-B)$16.14 (This indicates and suggests that there is still a big opportunity for Reed supermarket to try and get a bigger share of the customer’s wallet.) i.e. to get their customers spent more on every transaction

Table 2: Weekly Sales for Reed Vs a Typical Super Market
In 2010
A typical supermarket generates weekly sales ( C )$485,000 Reeds total annual sales for the year for 25 stores$660,000,000 Reeds total annual sales for the year for 1 store ( 52 weeks )$26,400,000 Reeds total weekly sales per store or for 1 store ( D )$507,692.31

Reeds Weekly sales LESS Typical supermarket weekly sales$22,692.31 i.e. as a percentage of the benchmark104.7%Indicates they are doing something This is around 5% higher than the average typical supermarket weekly sales.Well in the market space....
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