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Mullins: Publix swats back in Walmart price war


Published:   |   Updated: July 7, 2013 at 08:23 AM

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 This time last year, Walmart started running print and TV ads in Florida that ask shoppers to bring in a Publix receipt and see how much they could save on those same items at Walmart. Each commercial shows a happy mom — and they are almost always moms — shocked and thrilled at how much she could save by leaving Publix for the world's largest retailer.


Here's the thing about those ads: they're working, at least from Walmart's point of view, and Walmart should send flowers to local PTA groups to say "Thanks."

Walmart officials tell me they've been running numbers on each market where the ads run, and they see a combined bump every week after those ads run in a given market. How much? About a 1 percent bump in a combined data point of foot traffic and cash register sales.

One percent may not sound like a lot, but that's a big deal for grocery stores, many of which count their profit margins in single digits. Take that 1 percent and multiply it across a market that sees millions of shoppers every week in grocery stores, and you're starting to talk about real money.

Walmart has one big target in all of this, and it's not Target with a capital T. It's Publix. The two stores share the bulk of grocery sales in Florida, and in every market where Walmart launches these receipt-focused TV ads, they pick their largest rival. Up north it may be Kroger. In other markets Piggly Wiggly, and so on. Here, it's Publix.

When Walmart gets ready to produce an ad, the company and its production crews scour a local market for moms, starting with school parent teacher associations, health clubs or anywhere else moms are likely to gather. Walmart reaches out to several moms until it finds a willing volunteer. Staffers give her a one-day head's up and ask her to bring her most recent Publix receipt to Walmart the next morning - typically on a Tuesday. (This gives the mom a chance to get ready and pick her best outfit for TV.)

Staffers then walk the mom around the store, comparing products and prices. To play somewhat fair, staffers are instructed to compare only brand-to-brand and size-for-size products, i.e. an 18-ounce jar of Jiff - not Jiff at Publix versus Walmart's own brand, Great Value.

Then they total up the savings, and voila, Walmart ends up lower in price, at least in the TV ads. Walmart shoots the ad on a Tuesday,airs it on Thursday and stops running it by the next week. A companion print version runs across the market, as well, lining up receipts side by side.

A recent comparison used receipts from "Alea," with items like Oscar Mayer lunch meat, Starbucks Frappuccino drinks and Blue Diamond almonds. Publix total: $166.66. Walmart total: $146.21.

"Aha," Publix officials respond. That doesn't include the signature Publix way of savings money, BOGO deals. And Publix has started installing signs in stores that show its own price comparisons, including a list of 30-plus items like Bounce dryer sheets, Alka-Seltzer and Ocean Spray juice, that would total $323.38 at Walmart and $240.35 at Publix.

Walmart typically has the lowest prices, as measured by the Market Basket data that we at the Tribune collect on 30 items at Walmart, Publix, Winn-Dixie, Sweetbay and Target. But that index doesn't count BOGO deals as half off either, because shoppers still need to pay full price to buy the first item. (It's a statistical dispute that Ph.D. economists still disagree on, and the debate won't end with one column written in the newspaper by me.)

But for now, Walmart officials are thrilled with their ads, and there's no plan to stop them anytime soon.

Other retail, restaurant and trend news around town:

? Some sad news to report. Last week, a long-time retail executive in town died, Tom Locke. He was most recently manager of University Mall, and business leaders across the region praised him for years of work to make the University area a better place. Just to name two things, he helped start many of the business groups in the area, and he helped rezone the area behind the mall for mixed use so the University of South Florida and other companies could bring in new offices, dorms and services. A long list of people quickly came forward to say how much they'll miss Tom, and how he was such a genuinely nice guy. Add me to that list. University Mall has taken hits in recent years, like many malls that size. But Tom was someone trying to keep it together, and while other malls that size have closed down, he helped steer University toward a "value" mall property. But more personally, he always made time for my call, and I remember so many times wandering into his office deep within the back hallways of the mall and parking myself on his couch to trade retail news. He was always full of story ideas. He once called my predecessor and shared the amazing fact that his mall was selling more athletic shoes per hour than any other place in the country. He once called me with a tip that a very small food court operator was building the first fully kosher restaurant in the city. In this age of tightly controlled PR messaging and spin, he was the guy who would just talk. That's a trait to treasure, and with me, Tom was a genuinely nice guy.

? 'Tis the summer when pay TV providers promote their family TV content, targeting harried parents trying to occupy kids at home all summer. Both Netflix and Amazon announced new streaming TV programs, and this week, Bright House Networks announced eight new channels: Great American Country (GAC); BlueHighways TV; Inspiration, BYUtv (a project connected to Brigham Young University); Family Net; Jewish Life; Pentagon TV and NASA Public. For the exact lineup in your market, check your Bright House channel guide.

? Want some free Chick-fil-A? Then mark July 12 on your calendar and find a cow costume to wear. This is the third annual "Invasion of the Cows" event, when the chicken sandwich chain promises a free combo meal to anyone dressed "head to hoof" as cow, and a free entrée item for anyone with at least a few cow spots. OnThursday, Chick-fil-A will have wall-to-wall cow branding around town, just so you don't forget. For details, visit www.chickfil-a.com/cows/appreciation-day.

? Will Apple get a new dose of high style? Oui, oui! The computer/phone/media/vitamin/underwear company (just kidding about the vitamins and underwear, for now) recruited former Yves Saint Laurent chief executive Paul Deneve to its upper-most ranks. If YSL doesn't mean anything to you, just consider them a permanent member of the world's highest-of-high-fashion chains. So, what will the YSL newbie do at Apple? His role suggests a lot. His new job title is vice president of "special projects," reporting directly to No. 1 executive Tim Cook. Maybe he'll help get the rumored Apple wristwatch off the ground. Apple, by the way, is still looking for a replacement for its retail store chief, so perhaps Deneve will play a role in the future of Apple's perpetually crowded, ultra-minimalist stores.

rmullins@tampatrib.com

(813) 259-7919

Twitter: @DailyDeadline

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