NIS 6 in one basket, half a dozen in the other
A check of supermarkets shows consumers should stick to stores they find most convenient, and leave paltry price differences behind. According to a new survey, that is exactly what most of them will do
As Passover approaches, Israel's big retail chains are ramping up the battle for consumers. Super-Sol has hung up huge ads at the entrances to its stores, sayings it's provided the cheapest prices. If it hasn't, the consumer will get the difference plus a shekel, the chain advertises.
In most categories, it was slightly cheaper, if not significantly so. But in fact all the chains are vowing to be cheapest.
There's a reason for that attitude: A survey conducted on behalf of TheMarker by the Panels market research institution found that 52% of respondents say price is paramount when choosing where to shop for the holiday.
The advertisements are tailored to calming those fears. But the retailers may be losing their shirts in heavy, yet uneffective, pre-holiday advertising.
Consumers may not like high prices, but research shows they dislike changing their habits even more. Asked if price mattered, they said yes; but they also said they would shop at their usual place for Passover.
Moreover, a survey by the price comparisons website Zap for TheMarker found that the price differences between the two leading discount chains, Mega Bool and Super-Sol Deal, were very small, typically less than 10%.
The survey covered a basket of 44 items. When choosing between those two chains, at least, consumers are best guided by their sense of convenience and satisfaction with the service.
The survey was conducted on Sunday.
Paying out the nose in Ashdod
The prices of a given chain may vary from store to store.
Super-Sol deal stores in Tel Aviv and Ramat Gan were found to be cheaper by far than that basket of products than the Super-Sol Deal stores in other cities.
For instance, a basket of 35 products that Zap checked was cheaper at the Super-Sol deal stores in Tel Aviv and Ramat Gan - costing NIS 340, than in Ashdod, where the same basket cost NIS 440. That's a difference of 25%.
Similar differences were found between Super-Sol deal outlets in the center of the country, and branches in Kiryat Ata and Be'er Sheva. There the price of the same basket of 35 items ranged from NIS 380 to NIS 420.
A check of the Mega Bool branches in the same areas didn't find the same variance of price: At most the branches differed by NIS 10 from city to city for the same basket of goods.
Richard Hunter, the chief business officer at Super-Sol, says that more than 80% of the most popular products during Passover season - including wine, matza, oil and toiletries - are priced the same at all the Super-Sol stores. Also, he says, most Super-Sol shoppers belong to its customer club: members are responsible for 93% of the chain's revenues.
Meanwhile, we found that Nile perch cost NIS 35 in Rishon Letzion and Be'er Sheva but at the Yigal Alon branch in Tel Aviv, it could be had for NIS 23.20. However, Super-Sol club members will be able to buy the frozen fish for NIS 14.90.
Mega Bool customer-club members will also be eligible for goodies, such as a free 2.5-kilo box of matza if they spend more than NIS 500 at once.
The bottom line is that the retailers are trying to coax in shoppers with promises to be cheapest, but the price differences are nothing to write home about.
The advertisements are generally meaningless. Neither of the two big chains can claim to be substantially cheaper than its arch-rival, concludes Zap CEO Eitan Zinger. Possibly if they'd decided to pass over paying millions to ad firms and stars, he says, they'd have more to pass onto consumers.
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