Delhaize Group in the U.S. has revised its strategy for the Food Lion banner, to strengthen its price position after its sales in 2010 dropped by 1% to $18.8 billion and its profit fell by 1.8% to $998 million. More price investments are among a number of “concrete initiatives” slated for Food Lion this year, which officials said would capitalize on improving sales trends at the chain during the second half of the 2010 fiscal year. Although Delhaize declined to provide specific details, it includes “an even bigger focus on sharpening Food Lion's price position as well as improving other attributes of the brand”, Delhaize CEO Pierre Oliver Beckers said.
In addition to that, Delhaize US is going to launch a new private label brand called My Essentials in the second quarter of 2011. The My Essentials line is priced to be competitive with value private labels at discounters, while touting healthy attributes, including putting nutritional information on the front of the package. The line will replace the opening price point Smart Options label, officials said, and offer 500 products. The former label offered around 100. The move marks the beginning of a strategy to grow US revenues from private labels to 35% of sales by the end of 2013, up from around 27% today.
Additionally, Food Lion will add more of its MVP savings centre kiosks to its stores. The kiosks, which are part of Food Lion's MVP customer loyalty card program, were introduced in stores last year, and generate and print out coupons for customers based on their shopping habits.
Users can swipe their MVP loyalty card at a terminal which then searches for available offers based on past purchases. According to the retailer, since their introduction, kiosk coupons have up to five times the redemption rate when compared with coupons delivered via traditional distribution channels.
Source: Planet Retail
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