Friday, April 4, 2008

Fresh & Easy Buzz Redux: Fresh & Easy Neighborhood Market Should Mimic Tesco UK's Penny-A-Bulb Compact Fluorescent Light Bulb Promo for Earth Day USA

Editor's Note: In the piece below (above the bold headline at the end of the editor's note), published on March 18, we reported on Tesco plc.'s penny-per-bulb Compact Fluorescent light bulb (CFL) promotion at its stores in the United Kingdom.

Further, in the piece we suggested Fresh & Easy Neighborhood Market bring that promotion across the pond to the USA for its Fresh & Easy grocery stores.

Earth Day 2008 (April 22) is only 18 days away. The penny-a-bulb CFL promotion would be a good one for Fresh & Easy in our analysis and opinion. Why? For the following reasons:

>As we've written often, the Fresh & Easy stores need food traffic. Promoting and selling CFL's, which are a hot ticket in the U.S. currently just like they are in the UK, for a penny each would generate excitement and drive new shoppers into the Fresh & Easy stores. It would be the first time many of these consumers set foot in one of the small-format, basic grocery and fresh foods grocery stores.

>Earth Day equals "green" or environmental and conservation-oriented themes, actions and in the case of retailers also promotions. CFL's save energy, last much longer than regular light bulbs, reduce carbon footprints and more. Perfect

>The promotion would help Fresh & Easy gain needed "green" or environmental street credibility. Prior to opening its convenience-oriented grocery markets, Tesco's Fresh & Easy Neighborhood Market sent out numerous press releases (and obtained media coverage) saying it planned on being a "green" (in the environmental sense) grocery chain. It also made various commitments to the communities it has its stores in about being "green.

The grocer has done a few "green" things like putting solar panels on its 850,000 square foot distribution center in Southern California, holding a plastic gift card recycling event in its stores after the Christmas holiday, along with a couple other environmentally-oriented initiatives. But not much yet, especially at store-level. The penny-a-CFL promotion would be a good element of the retailer's green retailing positioning and promises

>Lastly, and perhaps most important of all, doing an Earth Day penny-per-CFL promotion similar to what parent company Tesco is doing in the UK, would offer a social good to consumers and society. Every incandescent light bulb that's replaced decreases the amount of carbon that's emitted into the ozone. That's a good thing.

In our experience, retail promotions that can generate foot traffic, create excitement, tie-in with a key event (such as Earth Day) and offer a social good are about as win-win as a retailer can get.

What do you think?

Tesco is Currently Selling Compact Fluorescent Light bulbs For One Penny each in its UK Stores; Tesco fresh & Easy USA Should do the Same
Fresh & Easy Buzz, March 18, 2008

Tesco, the United Kingdom-based international retailer and parent company of Fresh & Easy Neighborhood Market in the USA, is currently selling energy-saving Compact Fluorescent light bulbs (CFL's) in its UK Tesco banner stores for the eye-popping low price of one penny each. There's a limit of four CFL's per shopper. Tesco is the UK's number one retailer and the third-largest retailer in the world.

British shoppers are flocking to Tesco stores to get their four-CFL's-for-four-cents bargain. The bulbs use far less energy--and thus result in lower electricity bills--than traditional incandescent light bulbs. CFL's also last far longer (up to five years in some cases) than incandescent bulbs And at one penny each, they are cheaper than even the most rock-bottom-priced incandescent light bulb.

CFL's also are much "greener" than the old traditional bulbs in that they not only save money on monthly electricity bills, they reduce a home owner's or users carbon footprint, since using the CFL's results in less energy use to power the lights in a home or a business.

We asked a researcher in the energy field to estimate for use how much a home owner or business would save by merely replacing four incandescent light bulbs with four CFL's (the per-person limit currently at Tesco in the UK.) He did some calculations and told us he estimates the savings would be about $2.25 per month on a monthly electricity bill by just replacing four bulbs. (We ran his numbers by another research who said they sounded about right.)
Keep in mind this savings is only for four bulbs. Count the number of light bulbs you have in your home and then do the math. It adds up. If you have 40 incandescent bulbs and replace them with 40 CFL's, the savings could be enough to buy a week's or a month's worth of groceries.

Additionally, because CFL's lasts at least 3 years and up to five, and an incandescent light bulb lasts maybe a year if not used all that often, the savings is even more. It's what economists call further opportunity savings. And, of course, the additional green benefits of reducing your personal carbon footprint are, like the television commercial says...Priceless.

Bringing the promotion across the pond to Fresh & Easy

We suggest to Fresh & Easy corporate management they follow the lead of corporate parent Tesco in the UK and launch a similar "cheap CFL" promotion in their 59 stores in Southern California, Arizona and Nevada. Even selling the CFL's for ten cents each instead of a penny, will drive shoppers to the stores, fulfill some of the green and sustainable retailing pledges the grocer has made to the communities it's doing business in, and give the people (and the environment) a good deal.

There's a movement in the U.S. to ban incandescent light bulbs. It isn't moving as fast as other ban the 'fill in the blank' movements--such as plastic grocery bag bans--but its moving. It so happens the UK is ahead of the U.S. on banning the old bulbs at present--hence Tesco UK's penny-a-CFL promotion.

In fact, Tesco and other retailers in the UK have committed to stop selling the incandescent bulbs completely by 2011. However, the movement is gaining steam in the U.S. and we believe it will continue to do so. [Read more about the ban the bulb movement here.]

Piggy-backing on Tesco's current UK "one-penny-per-CFL bulb" promotion for Fresh & Easy in the U.S. would gain F&E some needed green credentials, offer shoppers (and potential new shoppers) a "green" deal, and create a little--and very much needed--excitement in the stores.

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