Whole Foods, known for their natural and organic groceries has been switching their multiple financial and marketing tactics amid the current economic downturn in the hopes of maintaining some of their upward momentum. From cutting back store openings to a shifting of their brand image.
Spending less on opening new stores will curb costs in the long term. However, in the short term, the cancellation fees on backing out of leases signed months to years ago, will take a sizeable cut from their capital. The company also sold a portion of preferred stock to allow for more flexibility in the current economy. The converted stock will be a welcome addition to their funds, although it has yet to be seen how the new stockholders will alter management decisions in the future.
Another stumbling block to Whole Foods’ momentum is their brand image, which currently associates with both high prices and quality food in the minds of consumers. While the quality foods perception is ideal, the high prices concept is deterring consumers from shopping there. Trying to shift from the stigma of organic foods being expensive, Whole Foods has implemented several discounts and promotions on their products to bring shoppers in. This tactic, a standard amongst generic markets, will help consumers alter their perception of Whole Foods’ brand.
Whole Foods needs to market their products as organic, healthy, and reasonably priced. As the largest organics food market in the nation, they are in a prime position to lead the organic food industry in altering the stigma of being overpriced. As the industry leader, their clout could help them find the best balance between quality food and economic prices. Consumers would be drawn in by both the health factor of the products, and the price, which has become a primary deciding factor in all purchasing decisions as of late. If done properly, Whole Foods own the brand image of “affordable organic”, a concept that has yet to be adequately promoted among those in the industry.