Save Money with Woolworth's New Product Price Drop
Woolworths have been coming under fire from all angles recently with Aldi taking the market by storm and Coles playing the price game very aggressively too. Despite Woolies revamping its rewards program recently to now include Qantas points, many customers are still disgruntled by the fact that discounts are only provided on selected products.
However, as of today they have changed tact by slashing the prices of everyday products which it considers to be Australian grocery staples. The chain will focus on one category per week for the coming month. If you haven’t shopped at Woolworths in a while, then it could be a money saving exercise to do so whilst these discounts are active.
The first wave of products to receive the chop have been bakery goods. For instance, baked in-store baguettes have been reduced from $1.65 to $1.50 (10% discount) along with a 700g loaf of Tip Top One bread coming down from $3.89 to $3.00 (33% discount) across most states and territories (excluding Tasmania and the Northern territory).
If you have a sweet tooth then Woolworths Select muffins which come in 8 packs have been reduced from $4.50 down to $3.50 (33% off), whilst savoury products such as cheese & bacon roll six packs are now $4.50 (originally $6, or a 25% discount). Chocolate chip cookies are one of my favourites so I was happy to find that a 24 pack of Woolworths Anzac or choc-chip cookies are now $5, down from an original $5.79 (14% off).
Steve Donohue, Woolworths’ head of buying made a statement about pasta and soft drinks which are due to fall under the firing line next. So we can all expect to see reductions there as well. San Reno pasta can be expected to drop from $2.45 down to $1.95 (21% off) and a two-litre bottle of Pepsi should drop to $2 from $3.10 (36% off).
The main reason for dropping prices across the board is to help Woolworths bring its pricing back in line with Coles, their main competitor. However, it wont simply be the month of April that we see discounts being applied, as Mr Donohue mentioned that they will continue into next month and some prices will remain at lower levels well into the future too. I have my doubts though, so lets hope he’s telling the truth.
A quick reaction was required after the new rewards scheme that Woolworths launched this month was badly received by customers. Ben Gilbert, an analyst at UBS mentioned that loyalty programs are less important to customers compared to lower every day prices on products and his words couldn’t be more on point, citing Aldi as a prime example. The entire business model of Aldi is cheaper prices than its competitors and they do not need a loyalty program to keep customers coming back.
Why are the big supermarkets failing to see this, you may be asking yourself? You see, humans are creatures of habit. If we know we can go to the same place every time and get the lowest prices then we will, because it’s a sure thing. If we have to depend on a loyalty program to potentially get he lowest price (as long as we buy the right products), well that just sounds like hard work. The ‘Woolworths Dollar’ that is earned on every dollar spent over $30 with no surprise went down like a lead balloon. As a result Woolworths’ new chief executive, Brad Banducci changed the rewards scheme to award customers with $1 Woolworths Dollar after every $10 spent on fresh food.
To put these price reductions into perspective, Coles have either the same products or the equivalents for exactly the same price, so it was imperative for Woolworths to bring its own products in line or risk losing out to their main rival.