Supermarket Price Cuts Haven't Won Over Surfers

Israeli supermarket chain, Super-Sol, came to agreement Tuesday with students after Tel Aviv University union started Facebook group calling for week-long boycott over its pricing policies; online boycott calls continued to surface Wednesday.

A day after the Super-Sol supermarket chain announced it had struck an agreement with the National Union of Israeli Students to lower prices of 30 leading products by at least 20%, the deal is coming in for criticism and is also dragging other supermarket retailers into the fray. Super-Sol, the country's largest supermarket chain, came to an agreement late Tuesday with the students after the Tel Aviv University union started a Facebook group calling for a week-long boycott of Super-Sol over its pricing policies.

Nonetheless Internet-based calls for a boycott of Super-Sol - and its major competitor, Mega - continued to surface yesterday.

Super-Sol committed to the NUIS that the promised price reductions on 30 products would remain in effect at least until next Passover, and would include such staples as eggs, hummus, milk, rice, bread, breakfast cereal and baby food.

For its part, Mega announced yesterday that it would discount 32 basic items, mostly sold under its own Mega house brand, by up to 30%. The chain said the discounts would remain in place until the end of the year and would not come instead of fall Jewish holiday promotions. Mega CEO Zeev Vurembrand said he did not want to comment on what was happening at Super-Sol, but promised that whatever prices Super-Sol offered, Mega would sell for less.

The leaders of the recent cottage cheese boycott campaign posted a new call to their 40,000 Facebook "friends" for a boycott beginning September 6 of Super-Sol and Mega, on the contention that supporters should not be satisfied with price reductions on 30 items and should stay away from the two retailers to give smaller supermarket chains and public marketplaces the business instead.

'Can't buy us'

One Facebook group, whose Hebrew name is the equivalent of "Boycott Super-Sol - we can't be bought with a promotion on 30 items. Period," takes the student union to task for its agreement in a video clip, and calls for a Super-Sol boycott until the end of the year. Another video on the Internet depicts a young man with a megaphone in front of a Super-Sol store in Eilat calling on customers to leave the store. It also features his encounter with members of store management.

"Super-Sol thinks it bought itself a seal of approval by throwing the students a few discounts," said Ya'akov Libi, who was one of the initiators of the cottage cheese boycott and is now calling for the boycott of Super-Sol and Mega until after the fall holidays. "They made the same proposal to us for two years, not just for a few months, but we didn't agree to it."

He said the student union was becoming a pitch man of sorts for Super-Sol, and it was not clear why. "We don't intend to halt the protest and the fight against [economic] concentration and [corporate] pyramids of control. It's not clear how they managed to convince the students to accept this deal. Super-Sol apparently understood that they had no choice but to come up with discount promotions without any connection to the student boycott," said Libi, asserting that he thought Super-Sol simply offered the students promotional concessions that the chain would have made in any event, but this way the chain came across as attentive to the protesters' demands.

"Super-Sol is crying over their low rate of profitability, but that's just because they are opening more and more locations to kill the competition, and we, the consumers, are paying for it with higher prices," he added.

Libi said he had a meeting with Super-Sol CEO Ephraim Rosenhaus after the launch of the cottage cheese boycott, in which the supermarket executive purportedly said when he initially approached management at the IDB Group - which owns Super-Sol - about some kind of concession to customers and they threw him out of the room, according to Libi's account. "Now they understand they have no choice," Libi quoted Rosenhaus.

One supermarket executive said members of the industry have questioned why Super-Sol was so quick to meet with the students, but added there was also speculation that IDB chairman Nochi Dankner was concerned that the protests could be redirected to IDB itself and to other IBD subsidiaries if the issue was not dealt with.

Rami Levi of the eponymous supermarket chain promised to offer deeper discounts than Super-Sol on its list of discounted items.

"It's all a show," said an executive at one smaller chain that competes with Super-Sol and Mega. "There are 20,000 items in a store and they lower the price of a few dozen. It's just hypocrisy. If they had wanted to lower prices, they would have lowered them across the board and not on 30 items."