Whole Foods' Image Problem

When I first smelled the overwhelming scent of rotting meat five years ago at a large grocery store with a reputation for its social scene that shall remain nameless, I started putting a little more thought into where I bought certain products. Whole Foods was closer to my house at the time anyway, and I started noticing a few surprising price differences.

Contrary to its "Whole Paycheck" nickname, Whole Foods' prices were actually lower on, for example, the yogurt I liked. A whole 30 cents lower. But whenever I explained to someone that if you shop carefully, you really don't have to spend more at Whole Foods, I was met with headshakes full of doubtful pity.

Of course you can go to Whole Foods and buy a four-ounce block of cheese for $15 or a small bottle of olive oil for $30, but no one's making you.

A story in today's New York Times delves into Whole Foods' elitist image problem and reports on a new ad campaign the company is runnung in New York that highlights "value" and "deals."

From the story:
Researching the price of branded products like organic chips in Arizona recently, [Andrew Wolf, a longtime grocery industry analyst at BB&T Capital Markets in Richmond] said, he found that Whole Foods charges, on average, 3 percent less than competing local supermarkets.

"The reality is that they are not a higher- priced competitor," he said.

"However, if your store looks cleaner and your products are better, you can create a price image that is higher than reality," he added. "You are punished for being good."

In response, the store is running ads like the one shown in the story, which pushes the $2.99 Oreo knockoffs. Isn't it ironic that while all the large chains are trying to be more like Whole Foods, Whole Foods is trying to be more like them?