Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale prices

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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by pseudo3d »

storewanderer wrote:The current ad still has coupons for non food. The coupons now say "valid with coupon and My Freddy's Card."

Personalized pricing that requires a card and smartphone app or website login? Store coupons that require the loyalty card to use?

Where did they get these ideas? Safeway?

This is a real loser.

If they want ideas they ought to go look at Real Canadian Superstore for some ideas. They could learn a lot more there.
For what it's worth, Kroger really was the earliest retailers (maybe it was Safeway, not sure) to do the whole "card required for sales" gimmick. Frankly, I'm quite surprised they took this long to gum up Fred Meyer.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by Super S »

If Fred Meyer rolls this out chainwide, I see Portland becoming a little more accepting of Walmart. But a lot of people will embrace the card thinking they are saving money, when in reality they are too stupid to realize that they can buy things elsewhere for the same price or less without the card. I will be taking my business elsewhere if Fred Meyer rolls this out chainwide. Too bad because Fred Meyer is the closest store to my house.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by Super S »

I wonder if the Happy Valley store opening this month may give any indication of what the future holds...
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by Super S »

For what it's worth, I noticed that my local Fred Meyer (Longview, WA) recently did an update to their self checkouts which revamped the appearance of the screen and added a different "voice". I did notice that the self checkouts make it a point to mention a "shoppers card" several times during the transaction now though....really hope this isn't an indication that they are expanding the card requirement...
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by storewanderer »

The same self checkout software is in use at CVS and Safeway and makes the same (multiple) mentions of a shoppers card if you don't put one in at some point before trying to "finish and pay."

I can't believe how different that Spokane print ad is from the typical Fred Meyer weekly ad... hardly any general merchandise advertised and far different grocery ad than the rest of Fred Meyer has. Actually that grocery ad looks like the standard Kroger grocery ad. I don't know what they did with Spokane, if they are trying to just run conventional grocery format stores there or what (if that is what they want to do, they need to double or triple the store count in that market). This is clearly a misguided strategy and a program developed by people with little to no knowledge of what Fred Meyer is.

One of the other "changes" they made was eliminating the dedicated nutrition department and scattering those items all throughout the store. Again, misguided.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by SamSpade »

storewanderer wrote:I can't believe how different that Spokane print ad is from the typical Fred Meyer weekly ad... hardly any general merchandise advertised and far different grocery ad than the rest of Fred Meyer has. Actually that grocery ad looks like the standard Kroger grocery ad. I don't know what they did with Spokane, if they are trying to just run conventional grocery format stores there or what (if that is what they want to do, they need to double or triple the store count in that market). This is clearly a misguided strategy and a program developed by people with little to no knowledge of what Fred Meyer is.

One of the other "changes" they made was eliminating the dedicated nutrition department and scattering those items all throughout the store. Again, misguided.
1. Just looked at that print ad. Ugh, so many pricing games. I was just thinking about how part of why I like Fred Meyer over local competition is that there's a well-merchandised food floor with no gimmicks. (buy five save $5 etc)
2. I have seen some store reviews online that complain about the confusion of having to go between Natural Choices (nutrition) and regular store for some items, but honestly, if you're a local or quickly learn, you know generally what they stock in each area. I usually start my shopping in N.C. after produce [most of their stores are laid out for this anyway] then move through the regular aisles. It's not that big of a deal. I always felt like it allowed Fred Meyer to showcase their higher-margin food/vitamin/health and beauty department better.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by storewanderer »

I guess the ad there looks like a standard Kroger ad and more of the standard Kroger promotions (as seen at Smiths, Kroger, Frys, etc.). And somewhat sloppy merchandising. Which is fine. That is how most Kroger banners do things and they get results doing that, which is fine. They get most of my shopping dollar so I obviously do not dislike that strategy. But that is not the type of ad that Fred Meyer operates with. Fred Meyer does not do sloppy merchandising. They do very large neat displays of fewer promotion items. Fred Meyer operates with a different (higher...) pricing strategy and veers toward higher quality.

Part of this also helps to separate Fred Meyer and QFC in Seattle and Portland where the two compete. QFC runs more of the Kroger style promotions (albeit fewer items and at higher prices) and Fred Meyer does its own thing, a little differently.

There is an issue that there are so many SKUs of nutrition that the Natural Choices department is not big enough to house all of the SKUs so they need to scatter those throughout the store. I think the solution to that is to expand the Natural Choices department. People who want those items like that department. Conversely, the customer who wants Coke and Oreos does not really want to go dig through displays full of craft soda, Ziva, Hansen's, Newman O's, etc. to find what they want, either.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by storewanderer »

I went into the 4 stores impacted by "Spokane Test."

The department that has truly been gutted is hardware/plumbing. Other departments, are for all functional purposes, still in tact. Clothing is 100% unchanged. Home fashion/kitchen appears to have had space cut but it is still more than adequate. Even the slimmed down electronics mix is still adequate with over a dozen tv's, some cell phone accessories, light computer accessories, full line of ink, and some dvd/etc. type items still. Sporting goods might be a little light but maybe not.

The weird part is the old electronics departments have been made into a strange combination of sporting goods/toys/electronics. These sit in front of the checkstands isolated from the rest of the store.

The "My Freddy's Card" is required for ALL sale prices and for clearance on clothing. It is also required if you want to use a store coupon. The offers are far from simple. One of their offers was "20% off school/office purchase over $20 of more with coupon and My Freddy's Card." This is really the wrong direction. They need to eliminate requiring the card for sale pricing and eliminate this sort of complication on coupons.

Pricing throughout the store is a lot higher than Smiths for the exact same items and the perimeters don't really look any better than Smiths.

All stores had extra 70% off clearance clothing and they were severely overstocked with spring/summer stuff.

The work they did ripping out floor tiles looks terrible as multiple locations have glue marks all over the floors. This makes the stores look very low end.

Some points of note:

1. The Thor Street Store is the only one that has natural foods integrated into the regular food aisles. The other 3 locations all have natural foods as its own department still.

2. The Thor Street Store had a frozen coffin case with the by the pound skillet ready frozen seasoned shrimp, chicken, and side items. They had two sides of the case filled, but the other two sides had bagged Kroger Frozen Chicken in there. I was disappointed to see this as I liked the looks of this program when I saw it closer to Seattle, maybe $7.99/lb is too expensive.

3. The abbreviate hardware departments are so terrible. They do not even have a 20x30 air conditioner filter (they stop at the next size down), except at Coeur d'Alene which did have these filters and a lot more hardware than the other two. Even Smith's sells a 20x30 air filter in the 55k square foot store I shop regularly (they have two brand options even).

4. The Coeur d'Alene Store has 1.5 aisles of sporting goods over near the garden entry. Then they have a few more aisles of sporting goods about 300 steps away and out of sight in the former electronics alcove up in front of the checkouts. Why couldn't they group ALL of the sporting goods together? My first impression upon walking the non food area was they cut the store in Coeur d'Alene to having only 1.5 aisles of sporting goods??? Unreal given that location. Then I saw the larger sporting goods area, as I was checking out... someone who goes in here looking for sporting goods could walk into the non food entry, go where sporting goods normally is, see the 1.5 aisles, and then exit the store without ever even seeing the rest of sporting goods that is across from the checkouts.

5. Some locations have plastic bags that say "My Freddy's Rewards" and some are using the standard Fred Meyer plastic bags.

6. Printing the "My Freddy's Rewards Price" on all of their signs on displays showing prices or percent offs in non food is very cumbersome and makes the signs look too "wordy." I don't know why they can't just print "with Card" like they do on the grocery signs/tags.

The stores were all very busy but the traffic is primarily food. The non food sides are clearly struggling. I suspect cutting out mix from non food only hurt that part of the business more. Kmart is closing across the street from Coeur d'Alene so I would think there are a few thousand dollars a day of non food sales up for grabs once that closing sale is done.

Fred Meyer seems lost as a one stop shopping concept; the general merchandise side appears to no longer be getting the proper attention or resources necessary to be successful. As such, it puts into question the whole "one stop shopping multi department store" format they operate under. It is very sad to see. I hope they can reverse course. And they need to eliminate this "My Freddy's Card" program while they are at it.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by Super S »

The grocery side of Fred Meyer does well. In all honesty, this is something Kroger has lots of experience with. But the general merchandise side I have noticed is kind of a mixed bag. Some things are reasonably priced, other things not so much. They have gradually scaled back some automotive and hardware/electrical items, but have good paint departments and a decent sporting goods area.

The requirement of a card though will only benefit those conditioned to think that a card actually saves them money (such as Safeway shoppers) when you can buy stuff for the same price, or often cheaper, at stores such as WinCo and Walmart. Cards are an old gimmick, which people are getting tired of, that has run its course. Many of the stores requiring them (grocery and otherwise) have struggled in recent years. They also tend to have higher shelf prices.

One reason why Fred Meyer does well with grocery is the fact the card is NOT required at most stores.
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Re: Fred Meyer "Spokane Test" - eliminate dedicated electronics, reduce GM, expand liquor/food, require card for sale pr

Post by storewanderer »

They have about 3 feet of shelving for pre-mixed tins of paint in a few colors in the "Spokane Test" stores (no more mixing in store) yet have like 6 feet or so of shelving for spray paint. They also have adequate paint accessories (brushes rollers and such) still in the "Spokane Test" stores.

I don't know anyone who thinks the cards save them money anymore. People are tired of cards. Requiring a card to get sale pricing is something that needs to go away at the present time when physical stores need to make things as easy for the customer as possible, not something to implement at the present time and play off as some sort of innovation. Some people enjoy the gas rewards though I suppose. Kroger obviously wants the shopper data and knows the only way they can get a majority of customers to use the card is to force them to in order to give them sale pricing.

The shelf pricing at Fred Meyer seems high. Produce is priced particularly high. In Spokane, their pricing on a lot of items was not much lower than Safeway/Albertsons, some key items were the exact same price even. I was really surprised how Fred Meyer's pricing was compared to the competition. The various URM Stores (Rosauers, Super 1 Foods, Yoke's) were all over the board with some competitive prices, some sky high prices, some good one day sales, etc. The URM Stores are absolutely a serious competitor. I think the URM Stores are really pulling business from Safeway/Albertsons not only in Spokane but also in the rural towns like Bonners Ferry and Sandpoint where newer Super 1 Foods have been built right across from the Safeways. Fred Meyer with only 3 stores in Spokane is barely a factor; even Rite Aid has close to a dozen stores in Spokane/Spokane Valley (2 are 24 hour stores too). What Kroger really should have done in Spokane, is built another couple of stores, rather than blowing money on the "Spokane Test." Maybe they want the shopper data to determine where/if/how to build new stores... data is great if you use it. Kroger has not opened a new store in Spokane in 15+ years, eventually you have to do something... how many stores have WinCo, Wal Mart, URM, or even Safeway/Albertsons opened in that market during that time? I suspect quite a few...
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