Monday, January 3, 2011

Food price value equilibrium continues it’s resetting.

George Bernard Shaw said, “There is no love sincerer than the love of food.” There is no greater gift that customer that loves your food, and will pay for it-but at what price? The consumer does not understand or believe in channel blurring. Channel blurring is only in the minds eye of the Brand Marketer. Here is my formula for establishing customer focused pricing:

Price + Quality + Service + Portability = Value

Incremental Value = Constantly Changing Menu (Seasonally / Sustainability with creditability).

Now, let’s look at what is happening at different companies, price and channel of distribution are clearly challenging each other this is about share of stomach. While Subway started the focus on the $5 foot-long we can see just where it has gone.

1. T.G. I. Fridays offer in 2010 a Jack Daniel's® Burgers and Jack Daniel's® Chicken Sandwiches for $5 and will offer $5 off all Jack Daniel's® Grill entrees for a limited time at approximately 600 US based participating restaurants.

2. Steve Davis, Arby’s CMO said $5 has become a magic number for fast food.

3. Shane’s Rib Shack has a family meal (feeds 4) for $20.

4. Popeye’s now as value meals from $1.99 & $2.99

5. McDonalds has three mini meals for under $3.00

The economy continues in a quagmire so price can be a determining factor. Brand marketers must be aware of the new product and price points that non-traditional competitive channels will introduce. Including attractive packaging, new product bundling options which in turn will contribute to establishing new long term price value models going forward.

Since 1991 Foodservice Solutions® a Tacoma, WA based retail foodservice consultancy has been the global leader in the Grocerant niche. For product or brand positioning assistance contact Steven A. Johnson and Foodservice Solutions® or visit or on Facebook at Steven Johnson, BING / GOOGLE: Steven Johnson Grocerants or

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