We know what a great grocery store promotion does on paper. Promotions and discounts boost sales, bring in new customers, and move items off the shelves — but it doesn’t always work out that way.
Mismanaged or improperly executed promotions can actually increase a store’s operating budget and harm its bottom line.
Why, you ask? There are a few reasons. Today’s customers are more price-conscious and more tech-savvy. Pair that with rising inflation and a more chaotic supply chain, and it’s no wonder grocery stores are struggling to find winning promotional strategies.
Avoid these seven mistakes to ensure your grocery store promotions are a success.
1. Not Planning In Advance
The first mistake to avoid in grocery store promotional planning may be the most obvious: not actually planning. Promotions that are thrown together at the last minute tend to fail.
Instead, plan your promotions far in advance. Create a calendar for holiday sales, local events, and other important dates. This will give you time to promote, price, and prepare for each promotion.
That isn’t to say you should never run ad-hoc promotions. Sometimes, you may need to sell some perishable inventory or other slow-moving items quickly.
One way to prepare for these short-term sales is to make promotion planning part of your daily inventory reports or during inventory counts. If you notice certain items are expiring soon in your inventory management system, it might be time to set up a quick sale.
2. Not Setting Specific Goals
Not knowing when your promotions are coming is one thing, and not knowing why you’re doing them is another. Promotions serve different purposes. Without clear goals, even well-executed promotions may fail to deliver the desired results.
For example, a short-term flash sale on certain types of produce or brands might be less about boosting sales and more about moving slow-moving inventory. Because the goal is to get those items out the door, you might discount them more aggressively and use eye-catching stickers or signage.
On the other hand, steep discounts might defeat the purpose if you’re running a holiday promotion meant to boost sales. With more preparation time, you can develop interesting product pairings to encourage upselling or highlight local brands at a small discount.
Common Goals of Supermarket Promotions:
- Promote new products or promote sales of an existing brand (e.g., a sale for your private label brand)
- Sell slow-moving inventory
- Boost overall sales
- Encourage upsells
- Bring in new customers
- Establish brand awareness
- Increase foot traffic
Always know why you’re running a promotion before you run it for better planning and execution. Track results against your goals to improve future promotional planning.
3. Not Measuring Promotion Effectiveness
Speaking of goals, how will you know when you’ve achieved them?
Sometimes, seeing items fly off the shelf can feel like a win, but the numbers can tell a different story. Maybe you discounted too aggressively, or the profit margin on those sale items was low to begin with.
Use the built-in reports on your point of sale (POS) system to measure the effectiveness of your grocery store promotions against the goals you set. Depending on your goals, you can look for things like:
- Weekly sales reports (e.g., see how much sales changed during a promotional period)
- Number of times a particular discount was used (great for newsletters and coupon books)
- Inventory turnover rate (e.g., did your flash sale help move specific items out of storage and off of shelves?)
- Average transaction volume (e.g., did your sale lead to people buying more than usual?)
- Customer loyalty signups (e.g., did an exclusive discount offer encourage people to sign up for your loyalty program?)
Important Note: Don’t feel like you have to nail every promotion to consider it a win — there’s still a lot to learn from a partial success. If your numbers trend in the right direction, you did something right.
Keep refining your ideas and measuring them over time to dial in your promotion strategy and increase return on investment (ROI) in the future.
4. No Clear Pricing Strategy
Setting prices has been even more difficult than usual, thanks to surging inflation, supply chain disruptions, and tighter budgets. Grocery stores find it much harder to maximize their sales and promotions without a clear pricing strategy.
Use your inventory management system to gain a clear understanding of the cost of goods sold (COGS) for your stock. You can then set pricing that makes sense for each item instead of just doing blanket pricing increases or discounts.
For example, setting the price of baked goods will likely be different than canned or other prepackaged goods.
This approach is equally important when planning your promotions. Understand the profit margin of different items, what they’re selling for at competing stores, and more, to set appealing prices without losing you money.
5. Undervaluing the Power of Signage and Displays
Eye-catching signage is essential to creating a better shopping experience. It’s also an important tool for making your grocery store promotions more effective.
Create red or orange labels and signs to naturally draw attention to sale items. Set up tables with standing displays for product promotions to draw people towards them.
Create a mix of reusable or modifiable signage (e.g., chalkboards that you can erase) for general sales to get the most bang for your buck. For larger or seasonal promotions, you might consider creating unique signs.
6. Lack of Marketing
You’ve set up an annual calendar for your grocery store promotions.
You’ve designed and printed the perfect signage.
You’ve looked at the prices of your sale items and tailored them for profitability.
What could go wrong? Well, all that preparation won’t amount to much if none of your customers know a promotion is happening.
Marketing grocery store promotions is an essential part of their success. There are a few ways you can market your promotions.
- Newsletters and email: Email marketing might seem old fashioned, but it has some of the highest ROI for small businesses. Highlight upcoming promotions in newsletters and entice them in with exclusive discount codes and offers.
- Signage: Signage helps customers find ongoing promotions and lets people know what’s coming up. If you have a big end-of-the-month sale, make window display signs or signs near the registers.
- Social media: Use your social media accounts to highlight upcoming sales and encourage people to sign up for your newsletter.
- Print, radio, and podcast ads: For a big sale, consider spending money on traditional ads to reach more new customers.
We understand that not every store will have the time or budget for elaborate marketing campaigns. However, some marketing is better than none. Try to carve out some time each day or week to promote your store.
7. Not Tailoring Promotions to Your Customers
Retailers across industries are all discovering the same thing: customers no longer respond to generic discounts the way they used to. Instead, they expect personalized offers.
Instead of basing promotions on a hunch, use the sales reports on your POS system to understand the types of products and offers your customers gravitate toward. Look especially closely at customers who have signed up for your loyalty program, as they tend to buy the most and are easier to market to directly.
Speaking of customer loyalty, use customer contact information to segment your customers into different groups based on their shopping habits. You can then create different promotions for each segment (e.g., customers who frequently buy ready meals, customers who buy soda and sparkling water, etc.).
Many big chains already do this, offering coupons to customers for items they already buy. Modern grocery store POS software also allows you to use this highly effective tactic.
Grocery Store Promotions: Avoid Common Mistakes With Your POS
Coming up with a winning grocery store promotional strategy can feel daunting on top of your daily tasks. This is why an increasing number of grocery stores are leveraging technology to streamline their operations and give them better insights.
A comprehensive grocery store system like IT Retail helps improve promotions by giving stores:
- Customized customer loyalty programs
- Visibility through sales and inventory reports
- Integrated SMS and email marketing
- Pricing insights and tools
- Flexible discounts and promotional setup
… and more.
Schedule a custom demo to see how IT Retail can simplify and improve how you run grocery store promotions today.
