Marketing vs. merchandising

Shopper Report, The, Nov, 2004 by Mona Doyle

Warning: This section of this Shopper Report is a piece of blue-sky, out of the box, speculative thinking about an industry that isn't growing its top lines (sales) or its bottom lines (profits) nearly as well as it would like to.

Supermarkets were born and grown by a second generation of merchant princes--a generation who walked in the footsteps of those who invented and built department stores. The first generation of merchant princes grew chains of stores named Wanamaker's, Macy's, Saks, Burdines, Rich's, Bullocks, and Gimbel's. The second generation of merchant princes grew stores with names like the Great Atlantic & Pacific Tea Company, Giant, Food Fair, Kroger, Hinky Dinky, and Safeway.

The grocers were merchandisers long before they were marketers. They made money not only by "buying cheap and selling dear," but building on their merchandising and real estate skills.

In recent years, supermarkets have tried to become brand marketers--with their own name an important piece of their marketing strategy. The great merchants who made their beautiful bargains compelling for housewives have improved their operations but failed to develop new merchandising skills or compel a new generation of women, and men, to shop their stores. If merchandising was what some business gurus might call their core competency, maybe most of today's major chains have gone too far in confusing marketing MBAs with merchant princes.

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