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We ran a story yesterday about how Pathmark had signed a deal to sell subway-branded deli meats and cheeses, and we commented:

Exactly why it is in the best interests of a supermarket to sell a product directly connected to a fast food chain – which by its very definition is in competition with the supermarket - escapes us. Just as we can’t quite figure out when it became desirable to eat fast food-branded products even when not visiting a fast feeder.

After all, what fast food joints offer most is convenience, not real quality. And we think it is a serious mistake for supermarkets to do anything to reinforce the notion that fast food is anything other than a less attractive alternative to cooking yourself, and one only to be embraced when you simply don’t have time to cook.

(Not that every fast food chain offers crappy food. But as a supermarket executive, that would be the premise on which we would operate, and the one that we would promote at every turn.)

And yes, we would extend this throughout the store. We’d walk up and down the aisles, and expel any product that carried the name of a competing retail brand. (Would Safeway carry a Kroger private label? Of course not. So why is it acceptable to sell Subway meats or Taco Bell salsas?)

Compete is a verb. It also, with apologies to Chris Matthews, should be the very essence of hardball.

MNB user David Carlson disagreed, citing something we wrote last week about making Starbucks coffee at home each morning in addition to visiting its cafés on a regular basis:

Why is in a Supermarkets best interest to sell Starbucks brand coffee? By your logic, the supermarket is in direct competition with Starbucks - every cup of coffee bought at Starbucks is one that wasn't brewed from beans purchased at one's own store. But, you've already countered that on Friday, using yourself as the example… I think the Subway meats and cheeses are a terrific idea - if you're going to put a fast food brand in your store, what better than Subway, who's always on TV talking about their low fat sandwiches?

Another MNB user wrote:

Interesting perspective coming on the heels of your article last week that your Starbucks branded coffee purchased at a local supermarket is incremental to rather than in lieu of your afternoon visit to your local Starbucks. Maybe a bit inconsistent? That said, one of the untapped opportunities that I have recognized is branding / co-branding of perimeter department products with center store. Why not have pasta salad in the deli made with the store brand pasta?

A number of people made this same point…so we went back to what we wrote last week to double-check.

Interestingly enough, you all assumed that we bought the coffee at the local supermarket. We actually get it ground at my local Starbucks.

Ironically, we happen to shop at a supermarket that grinds its own coffee and only sells its own brand – Stew Leonard’s. But we are loyal to where our son works...and besides, we love the Verona blend coffee.

But if every supermarket in America said that they were no longer going to sell Starbucks brand coffee because they said Starbucks was killing their brands and they didn’t want to help the enemy...we’d actually understand that.

MNB user Robert Trader wrote:

I think you are being a little too critical about Pathmark's new venture to sell Subway-branded products in it's deli. In my opinion, Pathmark is simply offering something that you always preach about, more choice for the consumer.

I am by no means a regular Subway customer but I think they have done a good job at promoting themselves as a healthier and fresher alternative within the fast-food choices that are out there while still delivering the convenience of traditional fast-food.

Pathmark is looking to offer another choice that brings product recognition and they will probably profit from it simply because consumers will make the "healthier" connection while giving their customers one more choice. Is the Subway product going to be any healthier than the deli choices Pathmark already sells? Who knows, but will it be any less healthy? It certainly will not be anymore convenient but they did offer one more choice that the customer will be able to recognize and make a decision on.

I don't think Pathmark is promoting fast-food and I don't think consumers will relate that buying the product is more convenient or that they should stop frequenting the deli department to buy their sandwiches at Subway…I would be upset if my local grocer limited my choices based on your argument.

We think that you’re right – Subway has done an excellent job of marketing health and nutrition. But we would suggest that the food you buy at a supermarket’s deli counter can be every bit as healthful and nutritious…the main difference is that most supermarkets have done a lousy job of marketing their offerings this way.

We do talk about giving the consumer more choices – but we’re really talking about giving the consumer unique choices that differentiate the retailer, not me-too products that serve to give greater credibility to the competition’s brand.

Another MNB user wrote:

Gotcha. Safeway does sell a private label Kroger product: Turkey Hill ice cream. (The Dillon's unit bought the manufacturing operation and the convenience store chain in 1985).

I disagree with your view on Pathmark selling Subway - it's all about the brand image. If the consumer thinks Subway products are better and can command a higher price than the no-name brand that Pathmark is selling. So what. For my local Pathmark, it would be a big improvement.

That may be. But we think that the better solution for Pathmark would be to improve its own, differentiated offerings, not jumping into bed with a glorified fast food chain.

Now, not everybody disagreed with us…

One MNB user wrote:

I don't get this. Is Subway meats suppose to be known for good quality? Or will is be sold for private label prices? I was under the impression that Subway was at the low end of the subway sandwich spectrum with Quizno's and perhaps Jimmy Johns at the higher end. Perhaps Pathmark should instead sell something of higher quality such as Boars Head. Maybe Pathmark could use this same logic to see if they could put a McDonald's label on their hamburger meat? Just imagine, some Pathmark exec has been sold on this. It probably won't be long until that exec is the next person out pursuing personal interests.

Another MNB user wrote:

Agree completely…sitting here scratching my head on this one.

I buy very little deli meat as it is due to what I perceive as poor quality or unwanted ingredients in most offerings This would cause me to steer even further away from the deli counter.

MNB user Kurt Burmeister wrote:

I believe this stems from lack of creativity and vision on the corporate level. They see the popularity of Subway and think they might "ride the wave".

Besides I wouldn't say Subway is known for their quality meats and cheese. They just happen to be an alternative for the people looking outside the fried food arena.

Besides that I have a question: Why doesn't my Subway sandwich look like the ones on TV?

You have to be careful which wave you decide to ride. Sometimes, you end up on the rocks. The result isn’t pretty.

But MNB user Steven Ritchey summed up the opposition:

I say let the marketplace decide. If I’m a store owner and my clientele wants Taco Bell branded products, or Subway branded meats, it is in my best interest to sell them.

As a retailer it isn’t my job to sell the consumer what I think is good product, it is my job to sell what the consumer wants. While I can do some education about nutritional values, meal preparation, and meal planning, and I certainly want to have employees who are knowledgeable in the products they sell so they can help the customers make decisions, in the end my job is to have what the consumer wants. Retailing isn’t done in a vacuum, it’s not always clean and well delineated, and at times you may sell products you find personally repulsive, but as long as it is a legal product, I think the consumer should decide if a product is on a stores shelves or not.

One other thing, I think it would be interesting to see what kind of store you would run and how long it would last. I don’t mean this as a knock against you, it’s something I say about a lot of so called experts, from sports analysts to political commentators, I wonder how they would do for real in whatever they proclaim to know so much about.

A fair question.

We’ve never worked in a food store, but we did work our way through high school and college in two men’s clothing stores (one a chain of three stores in Westchester County, NY, and the other a single store in Marina del Rey, California) and a winery tasting room (also in Marina del Rey).

All, we must admit, are out of business. Though to be accurate, we didn’t run any of them, though we sort of managed the California clothing store for a time when our class load was small.

Tell you this, though. Almost everything we know about retailing and customers we learned from the day-to-day business of taking care of customers, keeping the stores clean (we also cleaned bathrooms) and stocked, and even going through the going-out-of-business process (which if you’re emotionally invested in the place where you work, which we were, is like a death in the family). Sometimes you learn more from failures than from successes.

We also had great bosses, who taught us the importance of a work ethic and responsibility and made us feel like we were a partner in the business (long before this was a chic way to manage).

By the way, we think that in some ways we are still in the retail business. We just retail information. We have customers. We try to offer a differentiated product and service. And we hope we offer both value and values…and that our customers/readers respect them even when they disagree with us.
KC's View: