Giant touts the tale of the tapes

December 03, 1992|By Michael Dresser | Michael Dresser,Staff Writer

Giant Food Inc. hurled a ripe apple at Safeway Inc. yesterday, running full-page ads in Baltimore and Washington newspapers implying that its rival's program to assist schools is far less generous than Giant's.

The unusually pointed ads, which ran in The Sun, The Evening Sun and the Washington Post, asserted that Giant's popular "Apples for the Students" program "gives schools the most for their efforts" to collect register tapes that can be turned in for computers and other education equipment.

The ads listed six cases in which Landover-based Giant said it would provide IBM computer equipment to schools on much more liberal terms than Safeway does.

For example, Giant said it would donate an IBM PS/2 Model 40 with an 80-megabyte hard drive to a school that collects $141,000 in register tape receipts. It said Safeway requires $324,000 in cash register tapes for the same piece of equip

ment.

Larry Johnson, public affairs manager for Safeway's Landover-based Eastern Division, said that if it turns out Giant's register tape price is lower, Safeway would react just as if a competitor advertised a lower price on green beans.

"We're prepared to match anybody's price that's out there -- on IBM or Apple," he said, adding that the ad was the first he has seen in which one grocery chain uses comparison advertising against another in connection with a charitable campaign.

"I'm a little bit surprised that they've gone to that extent," Mr. Johnson said. "It's a marketing tool, and that's what they're using it as."

Terry Gans, Giant's vice president for advertising and sales promotion, said yesterday that he was disappointed that the ad was interpreted as a shot at Safeway's generosity.

"We're not trying to shame them or embarrass them or pick a fight with them," Mr. Gans said. "What Safeway does is up to Safeway."

Mr. Gans said the main reason for the ads was "to motivate the schools" to make full use of Giant's program. He said the participation rate was about 20 percent in the Baltimore area during the last campaign and about 33 percent in Washington.

Typically, the schools get register tapes by organizing students to collect tapes from their parents and other shoppers, but there is a wide difference in the response rate at various schools.

"It bothers us to the extent that some schools have missed that there is something they could do to help themselves," he said.

At the same time, Mr. Gans said, the ad was making the point that schools can get more for their efforts through the Giant program. "The comparison's there with Safeway because that happens to be reality," he said.

Mr. Johnson at Safeway suggested that Giant's comparisons might not be exactly apples to apples, or in this case IBMs.

"I find it hard to believe that the figures they use are inclusive of the various equipment and accessories that go with the unit," he said.

Mr. Johnson cited the first item listed in the ad, an IBM PS/2 Model 25-286 that Giant said it would provide for $167,000 in register tapes compared with $240,480 at Safeway. Safeway's package includes the microprocessor, 44-megabyte disk drive, 1-megabyte random-access memory, 30-megabyte hard drive, color monitor, keyboard, mouse and DOS 5.0 operating software.

Mr. Johnson said Safeway officials had not decided yet whether to reply to Giant with an advertisement of its own.

Giant officials said their company's package includes the same things and provided copies of the two companies' offerings that appeared to back up their claims.

Jeff Metzger, publisher of the Columbia-based trade publication Food World, said he was not surprised that Giant would run such an ad, even though it has not used direct-comparison advertising in more than a year.

"The recurring theme of their ads is 'We've Got More,' " Mr. Metzger said. "This is just an extension of that theme -- that they've got more beef than anyone else."

Mr. Metzger said he accepted that Giant wants to increase the use of the program, but he was skeptical of Giant's claim that the ad was not a shot at Safeway.

"They want to say they have an edge on Safeway and they want to show it in the most black and white terms," Mr. Metzger said. "Once you mention Safeway, you're pitting yourself against it."

Giant is the dominant grocery chain in the Baltimore-Washington area, holding a 39.36 percent share of the combined market, according to Food World. Safeway is second, with 18.69 percent, but its share in Baltimore is only 5.8 percent, according to the publication.

In achieving top ranking, Giant has won a reputation as a company that battles fiercely for market share, even at the cost of short-term profits.

"They defend their turf as well as anybody," Mr. Metzger said. "They can play offense and they can play defense."

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