A great newspaper article about the impact of the coupons and the groceries
It was in the LA PRESSE French paper Saturday,I translate it in English: here is the original link for those who read french:http://affaires.lapresse.ca/economie...-chez-maxi.php
Here you go: translate of the article in La Presse in English:Maxi says that the amount of coupons used by its customers is an increase of 30% for the second year on. A passion which, combined with its unbeatable pricing policy, force the retailer to change its supply management and the methods of work of cashiers.There are cities where the trend is heavier. These are mainly of the towns in the second Crown, like Saint-Jérôme, Joliette, Granby, Saint-Luc and Mascouche, entrusted the Loblaw in Quebec group spokesman Hugues Mousseau, La Presse Affaires. In some stores, the increase exceeds even 50%. Kicked 75 ¢ and $ 1.25, grocery deal with $ 7000 to 12,000 coupons per week.Director of major accounts, at Redemco, a company that handles one-third of the used coupons to the Canada, Carole Lafontaine is very surprised by these statistics. 'In Quebec, there no increase in the use of coupons from 2009', slice. Besides, Super C, Loblaws, Metro and Provigo recorded no increase. At Walmart, there was a 10% jump year last, but who has not repeated in 2013.At Maxi, is believed to be the exception that proves the rule because it is possible for two years to combine coupons to discounts offered by all other stores, said its representative. An advantage appreciated by junkies coupons, called colloquially the couponneuses (mostly women from 25 to 45 years).
Under this policy of the unbeatable price, deals seekers need only present a competitor circular to be eligible for the same low price. By adding a coupon, the final price approximates sometimes zero. And even below zero... what happened before that the computer system is reprogrammed to avoid negative prices.
The greatest impact of this approach is visible in the non-food (toothpaste, detergent, shampoo) because it is possible to make reservations. "Lately, I've already seen a girl empty the rack of toothbrushes in full", says Annie, an employee.Reorganization of the workforce
The growing interest for the discount by dint of the Maxi store managers to act, last fall. As the queues lengthened to caisses. When a customer arrives with three circulars and the cashier must check the prices of 15 blogs, in addition to read on a dozen coupons expiration dates, the flow is necessarily slow.
"We had problems. Wait 10 minutes to a Fund, is long. Me, I wanted to keep my standards. "And I want everyone to be happy, even followers of coupons than other customers", says the Director of the Longueuil Maxi & Cie, Maxime Chiasson.
He chose to increase its labour costs. "Compared to last year, there are always one or two cashiers more", he said.
Moreover, cashiers had instructions to call a boss when they identify a customer with a binder or an overflowing envelope of coupons in the hands. "I will take these people to a free case and I serve them, explains Liette Brisebois, an Assistant Manager. On an order of $ 100, they can save $ 30-40. It is five to ten times every two days, I would say."
The collectors of coupons do more sighing as before employees. "We closed the Fund, given that it was long [for other customers], tells Sylvie, cashier for seven years. After that, a new process was integrated. It is like the bicycle. "It has become a habit!Supply management
Other collateral effect: supplies, which depend only on balances Maxi, but those of the other brands! Monday, the store managers receive, from their headquarters, the list of products that will be on the upcoming circulars of competitors.
"If I know that the Fleecy fabric softener will be on sale elsewhere, I ask the Manager to order a palette. And often, it will put it directly in the entry to show that it matches the prices of competitors and to publicize our policy, said Maxime Chiasson.
This tactic allows to avoid shortages, since the couponneuses warned await balances to use their coupons. But it is expensive, given that the products advertised in the circular are sold at a loss (lost leaders). The impact on the margins of Maxi is therefore undeniable. "Lowest price guarantee is our position, and we are comfortable with it," insists Hugues Mousseau.
***Innovative coupons at Metro
Metro has just given an additional weapon to its customers who want to save: coupons custom online. A first supply in Quebec. Each week, members of its loyalty program metro & moi can go online and print a dozen coupons generated depending on their previous purchases.
The grocer denies that its new marketing strategy is a response to the recent decline of goodwill in its points of sale. "This fits into the strategic planning of metro & moi and is not a reactive action," argues spokesperson Marie-Claude Bacon.
In April, during the disclosure of financial results for the second quarter (ended in mid-March), president Eric Richer La Flèche hoped "the work of loyalty that we do [and] the work of customization that we do" to help the company to increase its sales, stable compared to the same period a year earlier.
Metro is not the only channel to undergo the change of purchasing habits. According to research firm Nielsen, Canadians will less often at the supermarket (21 visits less per year than 3 years ago).
In the case of the Quebec grocer, the ridership decline is offset by an increase of the average basket. But the pressure on profit margins remained constant. "It has never sold so many products in promotion. Balances determine the content of the papers of grocery stores. "Since [2008-2009] crisis, seen very, very well", recounts Marie-Claude Bacon. On the other hand, the use of coupons is stable, as in Loblaws and Provigo.
Thus, Metro do not regret to have removed its circular coupons. Especially as utilization of personalized coupons "would be 10 to 20 times higher than non-customized coupons", according to the retailer.
The rate of use of online coupons is "difficult to say, says Carole Lafontaine, Director of major accounts at Redemco.» It requires much effort to consumers to save 30 cents. 10,000 Coupons that you receive, there are maybe 100 or 150 coming from the internet [of 1-1.5%].
The rate of use of coupons placed on the shelves of 25%, and 80% of the coupons affixed to the product are used.
On the side of IGA, it refuses to disclose statistics about coupons. "I never gives figures", justifies the spokesperson Anne - Hélène Lavoie.
The grocer, who claims to have been the first to withdraw its circular coupons, also multiplies the tactics in recent months to save its customers. As evidence, his most recent slogan: "On food prices.
Previously, IGA was rather on the pleasure of eating and the variety of its offer with "Vive the food. Its new approach has been described as 'vulnerable gesture' by Brigitte Allard marketing expert who, in his blog, sees a message 'dissonant', ' that does not pass.
"Is a marketing strategy, that's all," answered Anne-Hélène Lavoie when we asked him to justify this change of course.
The average value of the coupons, the Canada is 1, 00-1,$ 25, according to Redemco.
***All discounts under one roof
No need to spend half a day to do a 'milk run' at Jean Coutu, IGA, Super C, Pharmaprix and Metro to buy what is on sale. You can get the same low prices with a single stop at Walmart or Maxi. This is the tactic of these two retailers to increase their traffic. But in an industry renowned for its anemic profit margins, is this sustainable over the long term?
At Maxi, it's called the unbeatable pricing (from 2011). At Walmart, it is rather the policy of competitive prices (since 1994). In both cases, it equals the price announced by competitors on simple presentation of proof (a circular, generally, but Walmart is planning to accept the evidence displayed on smart phones, learned).
In all of the Maxi in Québec, the number of adjusted prices is an increase of 50% since the beginning of the year, compared with 2012. At Walmart, there is a 30% increase since the retailer actually more and more promotion.
"Has increased from 40 000 to 120 000 transactions including an unbeatable price in one year", welcomes the Director of Maxi & Cie de Longueuil, Maxime Chiasson, even though he admits that it reduced its store sales and its profit margins. "This is not serious. It brings us many customers, and we take on the volume."
The volume is precisely one of the two conditions so that this policy is sustainable, believes Jean-Claude Dufour, expert in agri-business management at Université Laval. "It is tenable if it generates enough volume to compensate for the losses, and must have a diverse range of products to maintain a certain average profit margin in the store."
Food, he said, generates a gross margin "of 22 or 23%, which is about 8% lower than general merchandise" such as furniture and clothing (two categories sold by Maxi and Walmart). In other words, buying trousers Joe Fresh for Sonny and a barbecue compensates for the loss collected on ketchup and detergent.
Jean-Claude Dufour, Maxi strategy is typical of the arrival at Quebec of supercenters from Walmart two years ago, the first harddiscounters of the province. «It is both defensive, we want to prevent Walmart to take more market share, and offensive because it wants to keep customers.»
"Do you mean that Walmart and Maxi are not always the cheapest! analysis JoAnne Labrecque, expert in retailing at HEC Montréal. If they do not maintain the perception that they offer the lowest prices, their model does work more [...]. It also demonstrates that there is a real war for market share."
***Five ways to save...
1 Internet
Subscribe to sites that you will send coupons periodically (such as P & G). See the blogs of couponneuses as well as manufacturers Facebook pages. Give your email address to receive custom offers loyalty programs.
2. Cut out the coupons
As perhaps your mother, cut out coupons. But don't forget to bring with you when you shop and give them to the cashier!
3. The policies of the lowest price (at Maxi and Walmart)
Make your grocery store with circulars from competitors in hand to benefit from the best prices offered by Metro, Super C, Loblaws, Provigo, Jean Coutu, Pharmaprix, Uniprix, your local fruiterie, etc.
4. Loyalty programmes
Subscribe to metro & moi free and use your card to each transaction. Exchange then the coupons and rebate received quarterly. Don't forget to print your coupons online. By giving your Air Miles at IGA card, you will earn miles that you can use to pay for purchases (prefer, then, the products on sale) at Jean Coutu, Rona and Shell. Members of the Pharmaprix Optimum program, do your purchases when we offer bonus points and spend them when they are worth more (on sale or expensive products).
5 Free products
IGA systematically offers a free product with every $ 70. Check the flyer for other offers of free products with purchase. Metro also regularly offers.
