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Tag Archives: Strategic Pricing

Dollar General Will Keep Selling (Some) Groceries and Other Goods for $1

18 Tuesday Oct 2022

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts, Chapter 17: Retailing and Multichannel Marketing

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dollar general, Retailing, Strategic Pricing

There aren’t a lot of grocery bargains to be had these days—unless you’re shopping at Dollar General. While competitor Dollar Tree has raised the price of many of its goods to $1.25, Dollar General is committed to keeping lots of items at just one buck, and even expanding its $1 offerings, while also expanding its grocery offerings. This decision and dedication reflect Dollar General’s recognition that its consistently low price offerings are counted on by “core customers” whose incomes are less than $40,000 per year, and who run out of cash in the last week of most months.

These customers are visiting stores more often, though they make fewer purchases during each visit, likely signaling their budgetary constraints. The stores are also attracting new, newly budget-conscious customers who are seeking less expensive groceries, as inflation is otherwise driving food prices up, and up, and up.

Currently, about 20 percent of Dollar General’s merchandise is selling for $1. The retail chain is working toward offering even more products at this price. It also is bolstering the fresh, refrigerated, and frozen foods that make up its DG Fresh initiative. The company is now self-distributing refrigerated and frozen foods across its 18,000-plus stores, and it plans to have fresh produce in 3,000 stores by year’s end, in an effort to compete with traditional supermarkets instead of convenience stores. In support of this initiative, Dollar General plans to install more than 65,000 refrigerator cooler doors this year.

It’s good for customers’ bottom line, and Dollar General’s, too. A second quarter report showed that sales had increased 9 percent to $9.4 billion, and same-store sales rose 4.6 percent. An updated full-year sales prediction indicates that full-year sales will increase about 11 percent, up from the previous estimate of 10 percent.

Discussion Questions:

  1. Why would Dollar General not raise its prices, even while its competitors are doing so?
  2. Is it good or bad for business, for Dollar General not to raise prices?
  3. Could Dollar General compete with traditional supermarkets? How should it go about doing so?

Source: Matthew Stern, “Dollar General Plans to Expand Its Selection of $1 Items,” RetailWire, September 16, 2022; Heather Lalley, “Dollar General’s $1 Groceries Are Here to Stay,” CSP, September 14, 2022; Nathaniel Meyersohn, “Why Dollar Tree’s Price Hike to $1.25 Could Be ‘One of the Worst Decisions in Retail History’,” CNN, December 8, 2021; Nathaniel Meyersohn, “Rising Prices Are Pushing Shoppers to Dollar Stores,” CNN, June 8, 2022; Jon Springer, “Dollar General Plans to Self-Distribute Fresh, Frozen Foods,” CSP, March 18, 2019; Sam Silverstein, “Dollar General Bulks up on Perishables in Q4 as Overall Comps Wilt,” Grocery Dive, March 18, 2022; Marianne Wilson, “Dollar General Posts Strong Q2, Upbeat Guidance,” Progressive Grocer, August 26, 2022

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Walmart and Target Are Among the Retailers Slashing Prices

20 Tuesday Sep 2022

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts

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Strategic Pricing, Walmart

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Shoppers, get your credit cards ready. Some, but not all, of America’s largest retailers have too much inventory just lingering …

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Wait, Online Prices Are Actually Going … Down?!

22 Monday Aug 2022

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts

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online shopping, Strategic Pricing

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How much is that television on the shopping website? Probably quite a bit less than it was last year, or …

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Can Ads Save Netflix?

05 Tuesday Jul 2022

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts, Chapter 19: Advertising, Public Relations and Sales Promotions

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advertising, netflix, Strategic Pricing

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The end of the COVID-19 pandemic (or at least its transformation into something that we just sort of live with) …

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Identifying the True Value of Products and Pricing Them Accordingly

17 Tuesday May 2022

Posted by grewallevymarketingnews in Chapter 01: Overview of Marketing, Chapter 04: Conscious Marketing, Corporate Social Responsibility, and Ethics, Chapter 15: Strategic Pricing Concepts

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Conscious Marketing, Overview of Marketing, Strategic Pricing

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The prices of consumer products generally are based on the costs required to produce them, plus some margin so that …

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Borrow a Pattern, Pay the Source: Can Strategic Pricing, Design, Marketing, and Value Assessments Save Endangered Wildlife?

09 Monday May 2022

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts

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Strategic Pricing, Wildlife

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For activists determined to protect and maintain threatened and endangered animal populations, creativity often is key. When existing methods stop …

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Tiered Pricing by DoorDash

07 Monday Jun 2021

Posted by grewallevymarketingnews in Chapter 07: Business-to-Business Marketing, Chapter 15: Strategic Pricing Concepts

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B2B Marketing, DoorDash, Strategic Pricing, Tiered Pricing

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The COVID-19 pandemic has been a massive opportunity for some firms, including DoorDash, which grew to take over fully half …

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Lowered Supply, Fluctuating Demand, and Vaccines: A Perfect Storm in the Rental Car Industry

20 Thursday May 2021

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts

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car rentals, Strategic Pricing

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When travel stopped, due to the COVID-19 pandemic, rental car companies were saddled with a lot of inventory and not …

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Even Though Retailers Don’t Want to, Offering Buy Now, Pay Later Options Appears Unavoidable

26 Monday Apr 2021

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts

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Buy Now Pay Later, Strategic Pricing

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If given their choice, retailers would ask customers to pay with store-branded credit cards before any other option. Probably their …

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The iPhone SE: The Moment When Apple Finally Began to Follow Conventional Pricing Models

16 Thursday Jul 2020

Posted by grewallevymarketingnews in Chapter 15: Strategic Pricing Concepts

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apple, iPhone SE, Strategic Pricing

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For virtually all of its history, the iPhone has contradicted traditional predictions about how product prices develop over time. That …

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  • Chapter 01: Overview of Marketing (76)
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  • Chapter 14: Pricing Concepts for Establishing Value (97)
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