Haggen’s Price Pinch
Grocery stores are a wonderland. I love them. They have everything you could want or need in one place. A month ago I visited our new grocery store, Haggen, which replaced Albertsons recently. My takeaway from the visit was its unusually high prices. I have revisited the store to give an update. Folks are feeling Haggen’s price pinch.
In response to my original column Haggen’s communications director, Moran Golan, wrote “… like you, we were not happy with a pricing system issue that we quickly identified as part of our first wave of store conversions. Trust that we’ve been working diligently to correct it, and have been making great strides in doing so. The pricing position the Laguna store opened with is not representative of Haggen’s desired market position. Thousands of prices have already been lowered and more will continue to be as we work through system glitches.”
Fabulous! As a result I had been looking forward to revisiting the store. A month passed. Eager, I wore comfortable shoes and sported a clean haircut. A cup of black coffee in hand along with my original list, I patted my dog, kissed my wife and headed to the store. On the list were 12 regular household items like Bumble Bee tuna, Granny Smith apples, Chips Ahoy cookies, Minute Maid orange Juice, Campbell’s chicken noodle soup and Clorox bleach etc. I set out making a fair pricing analysis that could be compared between stores and was not likely to be affected by supply, seasonality, or exclusiveness.
Of the 12 items sampled seven were the exact same price as a month before. Four were lower and one was higher, a half gallon of Horizon 1% milk. Since the majority of my list’s prices were not lowered, Haggen seems to have failed to improve its pricing position.
Feeling more fun coming, I took the additional step to go to another store to compare prices.
By comparison, at Ralphs seven of the items were lower priced than Haggen, while four were the same and one item, Jiff peanut butter, was unavailable. Ralph’s averaged a lower overall price by 24 percent.
Haggen in Irvine responded to my price analysis by saying “… there seems to be quite a big discrepancy between ongoing price checks and yours.” I agree.
Another Haggen representative responded. “We do regular price checks at competitors’ stores to make sure our prices are fair and reasonable, and if you compare the same items at our store and other grocery stores, we think you’ll find that we’re within a few cents of each other on like items. Our most recent price check, completed within the last week, on the 100 most popular items according to Nielsen data, has us within approximately 1% of conventional retailers (sometimes under and sometimes over, depending on the product).”
I admit my sample was small. The intent was to randomly pick items that are the same despite which store you shop, with the goal of comparing only price. They say that they have already lowered thousands of prices throughout the store. Apparently most of those items weren’t on my shopping list.
Haggen prides itself on its produce and healthy items. For that you may find Haggen valuable. You could also go to the farmers market downtown for nice produce at a good price. For milk, bleach, cookies etc. you can shop another store and likely find a better price. I question what Haggen’s desired market position is. They are not successfully competing on price. There are other places in Laguna to find fresh produce, juices, etc., and if you like to shop for groceries in a well decorated, high-end store they aren’t providing that either.
By the time my cup of coffee was empty so also were my hopes of changes at the grocery store. I want Haggen to be successful. Variety is what we need in Laguna. I wish Haggen had taken the time to get its store in order, literally, before they opened. It’s a shame for the store because as time passes shopping habits change as previous Albertsons shoppers discover other options in the area. In the haste to open the store I ponder whether Haggen has made a mistake that will cost it shoppers for the long term. If Haggen were a new restaurant, they opted to sell you an unfinished meal with the promise to do better next time, so they could get your money now. Unfortunately, a bad experience lingers.
Maybe they will have a grand reopening when they work out the glitches.
I’ll give them another chance when they do. I’ll need a new haircut and a grocery thrill in a couple months.
Roderick Reed owns REEDesign Interiors in Laguna Beach. He lives in town with his wife Kathy and two sons Mason and Jack. http://roderickreed.com/.