Ad survey reveals lost opportunities for differentiation - Market ADvantage survey, discount chain stores - Regionals

Discount Store News, August 15, 1994 by Teresa Andreoli

If differentiation is the key to competing with discount leader Wal-Mart, then it would make sense that circular advertising approaches adopted by the regional discounters would offer consumers something fresh and independent.

But, of course, that's not the way it always goes. For example, home office, computers, cosmetics and furniture were four categories that Wal-Mart didn't advertise in its June and July printed circulars.

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One would think that of the horde of regionals trying to co-exist with Wal-Mart (or at least the five examined in this article), one chain would fast-forward the electronic publishing button and slather the next possible circular with two-page RTA spreads, 4-color PC graphics, or snazzy Maybelline and Cover Girl ads.

But they didn't. Not really. Ames and Venture sort of offered some furniture graphics. Ames devoted eight pages of 160 pages to some form of furniture promotion, and was the only regional to break the 5% barrier (5% of total pages devoted to that product category).

During the six-week period of May 29 through July 2, Wal-Mart distributed two circulars, the rest ran five. Circulars published by Ames, Bradlees, Caldor, ShopKo, Venture, Wal-Mart, Kmart and Target were virtually empty of cosmetics, computers and home office products, according to research compiled by Market ADvantage. The Northbrook, Ill.-based marketing research firm weekly tracks the print promotion of 125 hard lines product categories.

In general, regionals advertised household products to a greater degree than the national discounters, while the Big Three were much more active in promoting hardware.

The time period for study was chosen randomly. According to the study, the Big Three and the five regionals pushed household and hardware hardest as the warm weather began rolling in.

Caldor dug into electronics more than any regional chain by devoting more than 20 of 156 pages (13%) to the category over the five-week period. The others floated at Wal-Mart's level (about 7%) or below.

Women's apparel, often perceived as Wal-Mart's Achilles' heel, was free game in June, since the giant dedicated only three pages (7%) to it on promotion. Bradlees, in contrast, tagged 22 of 132 pages (17%) for women's apparel.

Bradlees and Caldor, fierce competitors in Northeast markets, tend to mimic each other's print promotion approaches.

For example, Bradlees' July 2 circular featured a mirrored two-page spread with a center bold logo and red text that read, "Bradlees Big Buys." It was framed by about 20 product squares. H&BC products dominated the spread, and price points ranged from $1.79 for a tube of 6.4-oz. Crest to $10.99 for a 3-pack of Kodak Gold Plus 400 speed film.

The previous month's Caldor circular featured a two-page mirrored spread with yellow text on a red background that read, "Your Choice $10." About 20 home products, ranging from a Toastmaster Bugs Bunny waffle maker (originally $14.99) to a Black & Decker under-the-counter can opener (originally $19.99), framed the center text of each page.

But this, of course, is not to imply that the regionals are sheep.

Ames' July 17 circular perked up the craftcraze with its two-page "Christmas in July!" spread. Specials included: two yards of seasonal remnants for $5, and a 25% price reduction of quilt batting, stitchery kits and MiniTree project supplies. About 25 red and green craft items were displayed in all.