I think you missed the point that FreshCo is Empire's competition to No Frills (and Food Basics in Eastern Canada). I'm guessing that Safeway is underperforming compared to their competitors, which have an option for value oriented shoppers - which No Frills (and Superstore) offers, compared to Safeway. Sure, they might alienate some of their customer base, looking for a full service grocery store, but they're likely going to be able to capture a larger market segment by going after consumers looking for value.TravellingChris wrote: ↑ Sobeys is busily converting full-service Safeway (and to a lesser extent, Sobeys) supermarkets in Western Canada to its FreshCo brand. The problem is that when they convert the store, they are removing the main reasons that consumers choose one of the Sobeys group supermarkets over a competitor: the full-service departments and Air Miles. I've always liked Safeway's bakery: that's gone when FreshCo takes over a Safeway. Our family avidly collects Air Miles: FreshCo doesn't participate.
What I fail to understand is what is supposed to bring me to FreshCo? What am I getting there that I can't get anywhere else? No Frills is the dominant retailer in the hard discount format. If I'm already shopping at No Frills (which already covers Western Canada pretty well) why would I switch? And if I'm a Safeway shopper at a store that is becoming FreshCo, why would I stay a customer of that location when all the reasons I shopped there are now removed?
The customers FreshCo are targeting probably aren't looking for the value add from Air Miles, it comes down to the receipt prices at the end of the day. The low prices are what FreshCo is looking for, Air Miles doesn't necessarily offer that. There might also be agreements in place preventing Air Miles from being offered at FreshCo, even if the company wanted to do so (and I really doubt that).TravellingChris wrote: ↑ What I really don't understand is FreshCo's refusal to participate in Air Miles. I understand it in terms of cost to the retailer, but in the absence of being able to earn or redeem AM at FreshCo, why would I go there as a shopper? I can earn PC Optimum points at No Frills (on featured products) as well as redeem them, so that's a factor in helping me to choose that store. So why would anyone choose FreshCo?
Happy Amex / Brim / EQ / Rakuten Canada / Rakuten US / Simplii / Tangerine Customer