Woolworths and IGA: supermarkets go local

Posted by Josette Dunn on 2nd August 2010

Australian supermarkets are adopting various strategies to tap into the growing trend to ‘go local’. Independent grocery network IGA recently launched an advertising campaign emphasizing the local individualism of each of its 1,000 independent stores. The launch came days after Woolworths announced it would clearly label its range of Tasmanian produce.

“Supermarkets are increasingly tapping into the ‘local’ trend, driven by consumers’ desire to support and feel part of their community”.

Earlier this month, The Advocate reported that Woolworths will soon be clearly labeling its range of Tasmanian food produce in an effort to satisfy consumer demand for locally sourced food. The news has been welcomed by local farmers, amidst concerns about the increasing level of food imports to Australia.

The strategy is an astute one, given the growing appeal of locally produced food. Indeed, Datamonitor’s April/May 2009 Consumer Survey found that over 26% of Australians are buying food and drinks produced locally to where they live either ‘all the time’ or ‘most of the time’. Meanwhile, 56% of respondents stated that knowing where their groceries come from has become ‘more’ or ‘significantly more’ important to them compared to two years ago.

The independent grocery network IGA has also recently announced a new campaign emphasizing the individuality of each of its 1,000 stores, which are tailored to the local community. The campaign is designed to leverage local store credibility and make consumers aware that their suggestions are valued. The six-month integrated campaign includes a television advertisement featuring local staff and customers and a new website with the catchphrase ‘How the locals like it’, which brings home the community message. In addition, the organization has implemented point of sale advertising which is tailored to each store, highlighting individual features and benefits.

“In the current retail environment, industry players are increasingly trying to distance themselves from being perceived as one-dimensional corporate heavyweights with little regard for the communities they operate in”. Strategies such as offering locally sourced products or promoting regionalized stores can go a long way towards creating goodwill among discerning consumers. Indeed, Australian supermarkets have a distinct advantage in this respect, compared to imports such as Aldi and Walmart. Expect to see other retailers follow suit, with more prominent product labels and in-store displays promoting local sourcing, strategic partnerships with local growers, and perhaps the revival of the ‘Australian Made and Owned’ symbol.