Woolworths scraps Safeway brand

Posted by Daniel Palmer on 21st August 2008

Woolworths has decided to banish the Safeway brand name 23 years after purchasing Safeway supermarkets in Australia, according to a report in Melbourne newspaper The Age.

US retailer Safeway entered the Australian market 45 years ago and their store numbers swelled to over 100 before Woolworths acquired Safeway Australia in 1985. Woolworths decided to re-name the NSW and Queensland stores but stuck with ‘Safeway’* throughout Victoria. Since then Safeway and Woolworths have essentially been as one in terms of marketing, with the only notable difference being the name.

The Age has also reported that the iconic slogan “The Fresh Food People”, which is used throughout Australia, could be scrapped, and the logo might be altered to resemble a peeling apple. According to The Age, the company is concerned that their slogan is overwhelming the brand name and, perhaps, with the change of name in Victoria, Victorians may have trouble getting used to hearing “We’re Woolworths the Fresh Food People”.

The likely impact

Changing the name of an established business is always fraught with danger and cannot happen effectively overnight. Woolworths, however, has sought to minimise the impact by gradually exposing the brand to Victorians.

Growth of their private label products has escalated and they have now introduced a credit card with the Woolworths branding. These products and services are marked as ‘Woolworths’ in Victoria and the company obviously believes that the time is right to withdraw the Safeway name.

Changing the logo and slogan at the same time, though, may cause confusion for some consumers. If they were planning to alter their logo in the near future then it makes sense from a financial point of view to change it at the same time as their signage modifications in Victoria, but it may take time for Victorian consumers to get used to the changes.

The cost of the decision will initially be high with sign alterations and promotional activities to inform consumers of the change. Over the long term, though, it does allow the company to streamline their marketing activities and reduce costs, as the brand name will be uniform Australia-wide.

The changes are, ultimately, unlikely to have any significant impact on their consumer base due to the gradual exposure of the Woolworths brand to Victorians, but the company needs to be careful in the manner in which they carry out the re-branding strategy.

* In Victoria ‘Homeshop’, ‘Liquor’, ‘Supermarkets’ and ‘Petrol’ operations typically have the Safeway name.