SOCIAL MEDIA MARKETING: Whole Foods tackles 'negative narrative' with national campaign

Whole Foods tackles 'negative narrative' with national campaign

By Tom Ryan

AUGUST 4, 2014

In an effort to boost traffic and help eradicate its "Whole Paycheck" image, Whole Foods last week announced plans to launch its first-ever national marketing campaign.

The campaign, to launch this fall, isn't intended to "drive short-term" sales or traffic but "be focused more on our differentiation, our values," as part of a long-term branding emphasis, said co-CEO John Mackey on its second-quarter conference call with analysts.

"We're trying to advertise who we are," said Mr. Mackey. "We're trying to change what we think is a negative narrative about our company. And we're trying to be very clear what makes Whole Foods Market the unique special better company that we are."

The campaign comes after the grocer missed on same-store sales in the second quarter and lowered its outlook for the fourth consecutive quarter. The shortfall was blamed on ongoing price cuts, cannibalization, and new competition. Investors have been concerned about mainstream grocery discounters like Walmart expanding their natural and organic ranges.

"Natural and organic products are increasingly available, but no one does what we do," said Walter Robb, co-CEO, on the call.

The campaign will highlight that Whole Foods is "the leading retailer of fresh, healthy natural and organic foods, offering the highest quality standards and an unparalleled shopping experience." It will tout transparency around products, including its 5-Step Animal Welfare ratings in meat, Eco-Scale ratings for cleaning products, sustainability ratings in seafood, and GMO labeling. This fall, a Responsibly Grown rating system arrives for produce and flowers.

But the overriding message will be highlighting "both our value and our values" that management implied isn't being heard.

Further investments in pricing are planned this year but some analysts appeared disappointed they won't be featured in the campaign. That's partly because promotions are set on a local rather than national basis. Management admitted it's been challenged getting the competitive pricing message out there.

"Even though we've been doing the value investments for a while, particularly with our 365 line ... we're still in the early innings of really learning and growing in how to do this," said Mr. Robb. "We recognize that we can do a better job communicating to the customers."

THE NATURAL FOOD DEBATE CONTINUES - What are your views?

The ‘Natural’ Debate

Rachel Adams

July 03, 2014 - Blogs

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Amid a maelstrom of class-action lawsuits, use of the seemingly simple word “natural" is one of the most risky
decisions today’s beverage innovators can make. Whether a product claims to be free of genetically modified organisms (GMOs) or gluten, or identifies itself as a beverage or dietary supplement, marketing and labeling issues have hit a whole new level of complexity.

In the free report, “The ‘Natural’ Debate and Other Regulatory Obscurities," a panel of experts shared an update on the controversial nature of natural, along with practical insight for the future.

Justin J. Prochnow, attorney and shareholder at Greenberg Traurig LLP, detailed some of the key regulatory and legal issues facing beverage and liquid dietary supplement companies. He also explained the threat of a class-action lawsuit has become one of the biggest concerns for brand holders. The lawsuits, frequently positioned as false or deceptive advertising actions, have covered a wide range of issues, with “all-natural" or “100-percent natural" claims leading the way.

Despite the shaky ground, Mark Rampolla, founder and former CEO of ZICO® Beverages, acknowledged the stakes are more lucrative than ever. Not only does “natural" represent a fundamental shift in what consumers are looking to drink, it also constitutes one of the fastest-growing segments of the beverage industry—one that’s birthed a number of mega brands.

In fact, according to Peter Leighton, founder of Abunda, more products on store shelves are using the term “natural" in some manner to help ingratiate the brands to consumers. As such, it’s important for marketers to provide clear information about a brand’s environmental and nutritional advantages.

The silver lining of the litigious environment, as pointed out by Eric Skae, CEO of The Bricktown Group, is that brands must reconsider what’s in their products. Additionally, it’s made the USDA organic and verified non-GMO seals much more relevant for beverages.

To read the full report, visit SupplySide Beverage Insights.