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Lewis fine tunes appeal to young women

BY Michael Johnsen

SIOUX FALLS, S.D. —Ever wonder where all those young people who graduate from college and move away to make their mark in the world are headed?

Sioux Falls has been named the No. 1 place for businesses and careers by Forbes magazine for five years running, so it may be no wonder that Mark Griffin and his team at Lewis Drug began noticing some subtle changes among their customer base a few years ago—more moms with kids in tow were walking their aisles.

Accordingly, Lewis Drug, which celebrates its 65th anniversary in February, earlier this month kicked off a new ad campaign targeting moms new to the area—a campaign that, for the first time, features some of Lewis’ homegrown pharmacists—complete with a new slogan, new store signage and even new uniforms for Lewis Drug associates. “We’ve got several new pharmacist [television] spots featuring our own pharmacists, human interest stories,” said Griffin, president and chief executive officer of Lewis Drug.

“We need to keep reinventing ourselves and keep our foundation fresh,” he said. “We’re targeting 25-to 45-year-old women. We found through research that the influx of younger people into our markets are moving into the Sioux Falls area familiar with national chains like Walgreens, but not as familiar with home-town pharmacies like Lewis. This has been about a year-and-a-half process starting with focus groups and surveying through store encounter groups. We basically went to the customers to find out what they thought of Lewis—what they liked and what we could do better.”

“A lot of our consumer base…are very loyal pharmacy customers, but we have a lot more to offer than your traditional drug store,” added Bob Meyer, Lewis general merchandise manager. Some of the in-store merchandising changes designed to entice mom include an enhanced infant and baby department and a change in focus in the sporting goods department from hunting and fishing to youth-oriented sporting goods—T-ball, baseball and soccer, for example.

Gone will be the Lewis slogan “the store next door,” replaced with a new slogan “feel good find” that emphasizes the bargain-hunting experience customers might find at Lewis Drug. Lewis Drug’s footprint reaches into the 40,000-square-foot range across much of its store base, and with that extra square footage is included a lot of categories typical of a department store—an extended lawn and garden offering, furniture and clothing.

The new campaign also will resurrect a Lewis slogan from the past—“Lewis. Your first stop.”

Television spots will appear throughout the day—morning talk shows, daytime soaps, evening news and even primetime. “But there also is some primetime cable…all the female-friendly channels, as well as primetime beginning the end of October through Christmas on network,” Meyer said, “where they have local breaks for shows like ‘Grey’s Anatomy’ or ‘Survivor.’”

With an estimated 148,000 residents now, Sioux Falls Development Foundation predicts an influx of 10,000 more residents by the end of the decade.

Lawrence & Schiller advertising agency is assisting with the research and the campaign.

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Fred’s reports both monthly and quarterly record sales

BY Allison Cerra

MEMPHIS, Tenn. Fred’s Inc. reported record sales for the five-week and eight-month periods which ended Oct. 6, 2007.

The company said Friday that its total sales for the month increased 2 percent to $161.4 million compared to the same period last year. Total sales for the year-to-date period increased 5 percent to $1.157 billion.

Same store sales for the month rose 1 percent on top of a 5 percent increase in September last year. On a comparable store basis, sales increased 1.3 percent through the first eight months of fiscal 2007 compared with a 2.7 percent gain in the year-earlier period. Same-store sales are a key predictor of how well the company performs in stores that have been open for several years, and how well the newly open stores will do in the future.

“September sales came in at the low end of our forecasted range of a 1 percent to 3 percent increase, affected by unusually warm weather across our markets and the disruption caused by the updating of 98 stores under our refresher program,” said Fred’s Stores chief executive officer Michael J. Hayes. “We look forward to finishing our refresher program in October with the last 60 stores and to a better economic environment for our customers going forward, as the benefits of the minimum wage increase and the focus of Federal Reserve Board on the credit crunch take hold.”

Fred’s opened four stores at the end of September, bringing total store openings to 22 for the year-to-date period. These new store openings have been balanced by the company’s decision to close underperforming stores. In the remaining months, Fred’s Stores said that it plans to open 14 additional stores, with no further planned closings, which will result in a net increase in stores of 2 percent for the year.

Fred’s Inc. operates 702 discount general merchandise stores, including 24 franchised stores in the southeastern United States.

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Target to open another 61 stores nationwide

BY Allison Cerra

MINNEAPOLIS Target announced that it will be opening an additional 61 Target stores, the company said Friday.

The stores, which will all open Oct. 14, will open in 22 different states. The majority of the stores are making their debut in Arizona, California, Ohio and Texas.

In addition to offering the latest in trend-right merchandise, Target also brings a 44-year tradition of community involvement. The retail chain commits itself to local communities donating more than $3 million each week to area nonprofit organizations, becoming involved in local volunteerism efforts through Target Volunteers, and orchestrating other special projects that help meet area social service, arts and education needs.

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