Coupons are out. So are weekly sales circulars. In their place is what’s described as “greater value throughout the shopping trip.”
Is this JCPenney in 2012?
No, it’s Fresh & Easy in 2014. And former fans are blasting the West Coast grocery chain for following what they believe to be the same dangerous, notorious path as JCPenney. That troubled department store famously did away with coupons and sales two years ago, then reversed course after it was clear the idea wasn’t working.
So why would Fresh & Easy think that adopting a similar policy of ditching coupons and sales would be any less disastrous? Partly because Fresh & Easy has already tried it the other way, with dismal results.
The British grocery giant Tesco launched Fresh & Easy in 2007, hoping the small-format U.S. grocery chain would be revolutionary. What it instead turned out to be was a money pit. The format never really caught on, Tesco lost a bundle, and it finally gave up and unloaded the entire chain last year.
In an attempt to make Fresh & Easy profitable, new owner Yucaipa Companies LLC set about making some changes. One of those changes was to stop losing money on virtually every transaction. Fresh & Easy has never accepted manufacturer’s coupons. But under Tesco, the store routinely offered dollars-off-your-total-purchase coupons – so routinely, that many customers wouldn’t shop without them.
And that, some Fresh & Easy watchers said, was a huge mistake. “Used too aggressively and too regularly, such deep discount coupons become the norm to shoppers,” warned the website Fresh & Easy Buzz, just one year after the chain debuted. Shoppers “mentally build the discounts obtained from using them into their mental calculus (shopper psychology) of how much they should be paying for groceries at the store that uses them so frequently.” Added industry analyst Jim Prevor a few years later, “the coupons became like crack/cocaine. They would boost sales but as soon as Fresh & Easy stopped couponing, it was like withdrawal symptoms — sales would crash.”
So the new owners are looking to start, well, fresh. “Obviously there’s been a lot of changes to improve Fresh & Easy over the last two months,” Fresh & Easy spokesman Brendan Wonnacott told Coupons in the News. “Our focus has primarily been on making the store as we’ve been saying: providing great value by becoming ‘fresher and easier.'” He described how the store’s prepared food, once derided by some for being about as “fresh” as what you’d find in a convenience store cooler, is now delivered daily and clearly labeled with a freshness date. “Fresher food equals more value,” he added.
As for the prices customers are paying without benefit of those frequent coupons, Wonnacott insists that Fresh & Easy still provides value. “Instead of weekly promo pricing, we’re focusing on great competitive pricing on everyday items that customers are looking for,” like milk, eggs and cheese. “Yes, it’s a big shift from dollars-off coupons and high-low promo pricing, but most customers have responded well to the changes.”
Some coupon-loving Fresh & Easy customers beg to differ. As one commenter facetiously wrote on the store’s Facebook page, “We are excited about the new changes, especially the new no coupon policy – said no Fresh and Easy customer ever.”
Other customers aren’t buying the lines about competitive pricing and better values. For weeks, they’ve been flooding Fresh & Easy’s Facebook page with complaints. “What happened to this store? The store used be fantastic, now there are higher prices, no coupons, no flyers, and the emails don’t give me any information,” one commenter complained. “First you take away the dollars off coupons, which significantly helped our family stay within our food budget, and now you’ve raised just about ALL your prices! I am done with you, Fresh and Easy!” wrote another. A third commenter even offered up a conspiracy theory: “I’m wondering if the price hikes, lack of coupons, store items, etc. are deliberate in an attempt to show loss and then instead of losing money the new company can file bankruptcy?”
Adding to the list of complaints are certain other changes Fresh & Easy has made, like eliminating its clearance section. Instead, clearance items are now specially tagged, but located in their regular spots in the store. “Thank you for creating the treasure hunt for clearance items,” one Facebook commenter wrote. “It saved me a ton of money on impulse buys since the items were scattered all over the store. I spent a lot less today! I almost didn’t miss the coupon.”
Some Fresh & Easy fans who remain loyal say the critics are simply overrepresented online. “While the overwhelming majority of posters here seem to continually desire the return of F&E coupons, I fail to see the same in actuality,” one defender wrote on Facebook. “In fact I haven’t heard or seen of anyone pitching complaints other than here.” Overall, positive Facebook comments are few and far between, but there are some, like “I am loyal to Fresh and Easy (even if you did get rid of coupons)!” and “I have to say, I’m digging some of the new items.”
Ultimately, the problem Fresh & Easy faces is that even having a dedicated and vocal fan base wasn’t enough to make the store successful. So if cost-saving changes can make the average customer more profitable, even while irritating many of the longtime fans, it’s a risk the store may have to take.
There are “lots of more changes in the works in the coming weeks and months,” Wonnacott promised, “all focused on bringing value that isn’t just money off at the checkout.”
Whether once-loyal fans stick around long enough to see all of the promised changes, could determine whether Fresh & Easy can turn things around – or whether the new owners will end up with as big a problem on their hands as the old ones.
Image source: Fruitnet.com
Unfortunately for Fresh and Easy thousands of their customers mirror the exact statements made here and have stopped shopping at their stores.
At one time I looked forward to my weekly runs to the local store(s) and would spend the majority of my grocery dollars there. Yes, I did use the coupons and shopped the clearance section…However, I also purchased items I surely could have saved marginal amounts on elsewhere and that were not discounted. Discounted items also allowed me to be able to afford to sample new items. This resulted in several new tastes I fulfilled there also.
In fact, I developed a taste for fresher food so when they made these disasterous decisions in pricing I just took those new tastes to their competitors, Trader Joes’s and Sprouts.
What kind of b.s. the customer business school crap is this strategy? It defies logic…
When I saw they did away with the clearance shelf items, increased the prices and did away with the coupons that was enough for me. I quit Fresh and Easy. I guess my point total will remain forever at 256 points!
Did discover a very cool store across the street called, “Sprouts” that I really like for its fresh healthy food.
Thanks for the article. Long time customer no more. I would even promote the store.
Its been really sad to see these changes because they were my fav store. We did 90% of our shopping there (rest was at farmers market and home items like toilet paper at Costco).
With these changes, its back to winco for us.
Employees have let it be known that they have raised prices on thousands of items throughout the store. Even before these increases Fresh and Easy’s prices were higher than alternative stores. Fresh and Easy has never taken manufacture’s coupons – the company always told us this was because they give dollars off store coupons instead. Now they have eliminated almost every discount and raised prices. Customers are smart. They are simply not going to pay more than they can get these items elsewhere. There are at least 30 grocery stores within 5 miles of Fresh and Easy. Why would I pay more than needed?
Concerning freshness of food. This has always been a problem at Fresh&Easy. Because they have a general policy to leave out preservatives this means fresh foods spoil faster. They depend on store employees to rotate stock, but because they have been losing money they run the staffing really lean and monitor labor very closely. This means there are not enough bodies to check dates on items. I have bought many items that were well past their freshness dates. I have also had issues with many items tasting bad well before the date in the packages. Chips. Nuts, Dairy. The problem however has gotten worse now that the store has 50% less sales there is even more aging food on the shelf. The new policy of putting “clearance” on the shelf next to non-clearance items means this old food will get sold even less. I don’t want old food unless #1 I plan to use it today and #2 I get at least 75% off. A 25% discount does not cut it.
On the fresh and Easy the store been busy deleting comments, banning members, hiding comments, and spamming their own wall with glowing employee comments. In addition employees have been attacking shoppers openly for asking about price increases and the elimination of coupons. I believe it is an unethical business practice to allow employees to post online reviews. Store workers who insult customers openly should be fired.
Store employees are also posting misinformation such as claiming that coupons are main reason why Fresh and Easy went bankrupt. Fresh and Easy went bankrupt because they made huge mistakes, their business model of self check only is deeply flawed, they didn’t expand as quickly as needed in order to support the infrastructure they built from scratch in the middle of the worst recession in modern history in an area that was worst hit by the mortgage crisis. They build a chain starting with no customers to start in a highly competitive market, launched whole lines of products, and marketed to potential customers who don’t even know what the store sells. They built stores in the ghetto then paid leases for years on shuttered stores. They put solar cells on their buildings that cost millions. They paid their former CEO a multimillion dollar golden parachute and pretended to ignore that fact that the guy was married to the daughter of the CEO of the parent company – as though nepotism is a word they never heard before. They tried to cut back on labor by cutting store hours to 9am to 8pm at many stores – ludicrous hours for a retail store. They did this for years. The list of mistakes they made and continue to make is huge, but know this: If not for coupons they would have closed the doors long ago because there never would have been enough customers in the store in the first place. Look, if they were the best store in the world with customers beating the door down to get in then they could justify cutting back on coupons. Instead of cutting back however they cold turkey cut out virtually every discount while simultaneously raising prices across the board by 30-60%. They also eliminated almost all advertizing and sales and eliminated the clearance section. So for me the cost of shopping in their store more than doubled. What is additionally annoying about this is the fact that they did it with no warning and have never made any sort of announcement about it at all. Communication with customers has virtually stopped. No ads. Almost no eMails. Canned responses to Facebook posts that make no sense. Things like “We know you liked the coupons, but we’re replaced them with value” – as if anyone’s definition of value is doubling the price.
Thousands of customers are very disappointed in the direction of the new owners. Let’s hope they actually pay attention to what customers are saying and doing. I have been shopping and saving elsewhere. At this point if they reverse course I may or may not be back. I’m just disgusted with the store right now. I can not see them surviving this unless they are willing to change.
Damn, this is a good comment. Ditto. All of my complaints eliquitly stated from a business and customer perspective. Someone needs to forward this to Fresh and Easy.
Wow, well said.
Frankly, they will fail.
They have the wrong CEO (Blockbuster? 7-11? really?) for the job.
They continue to employ too many of the same folks at the main office and warehouse that still make the same mistakes they have been making since 2007.
LOL.
The fresh product delivered to the store is the same as it has always been.
Delivered daily (no change)
Fresh as always but inconsistent quality and freshness as always
Easy? no change in registers and no extra help up front to deal with the awful machines (breaking down) and awful technology
No new products worth being excited about
Thank you for the article. I have stopped shopping there because the prices have gone up and no coupons. I was curious as to what had happened.