business news in context, analysis with attitude

The Boston Herald reports that “despite a promise by Wegmans to meet or beat Market Basket’s low prices, the New York grocery chain that drew more than 25,000 shoppers to its Bay State debut priced on the high end in surveys by the Herald and Consumer World.

“A sample of 25 staples including milk, eggs, coffee and soup at Market Basket in Somerville added up to $69.15, while the same items at the new Wegmans in Northboro checked out at $70.95 — or $1.80 more.”

Wegmans had vowed to “offer the same or lower prices compared to Market Basket and Walmart — the low-price leaders — on comparable items.”
KC's View:
This reminds me of a focus group I ran several years ago while producing a Japanese documentary about Wegmans. (What can I tell you? It’s been an interesting career...)

We did the focus group down in Washington, DC, then a new market for Wegmans, because the Japanese funders wanted to understand the retailer’s appeal in areas where it did not have a longtime presence. And the highly diverse focus group told me almost unanimously that as much as they loved Wegmans fresh foods and customer service, they really loved Wegmans’ prices ... not because they spent the least there, but got the most for their money there. On the store’s fresh food perimeter, the value was enormous, they said, and in the center store, Wegmans was absolutely on par with local low price leaders.

They defined value in terms broader than having the absolutely lowest price. And that’s something that more retailers should keep in mind. Not to mention newspapers that run such stories. (I hate market basket stories. They always strike me as hackneyed and predictable, and totally without subtlety.)

Besides, for the record, the Herald story says that on 25 items, there as a total difference of $1.80 - which works out to a difference of about seven cents per item. Which ain’t a killer if you think the value is there.

Context is everything.