Our Mob’s Choice range is a select group of essential products at discounted prices that are sold in the community stores that AIG manages. Mob’s Choice is a critical element in AIG’s community store strategy to convert community stores into financially viable social enterprises by positively changing the way customers buy from the stores we manage.
Choosing products in the range
Mob’s Choice is 100% community driven and we continuously work with shoppers and store owners to create a range that is in demand, contributes to healthy living and is valuable to the customer. We choose the products in the range in three ways.
Using historical sales data on the most popular and healthy products sold in the stores, we can form an accurate picture of which products to include in the range.
We test our data driven range with store owners and seek input on which products should be a part of Mob’s Choice and clarify why it was important to charge less for those products.
Additionally, we encourage a culture of customer feedback, where people who shop in the store feel confident to suggest the products they wanted sold in the store.
Today there are 70 items in the range covering four categories: food, cleaning products, health and beauty and general merchandise.
Advertising Mob’s Choice in store
All products in the range are tagged with the Mob’s Choice shelf talkers to enable easy identification of the discounted items throughout the stores.
The intention is to promote awareness and foster trust in the Mob’s Choice brand to encourage sales of the Mob’s Choice products. Ideally shoppers will begin to seek out Mob’s Choice products because they know they are products they like and can afford.
Pricing
We charge reduced prices for the Mob’s Choice range using three methods: not accepting rebates (kickbacks from suppliers for stocking their preferred products), negotiating with suppliers for better prices, and charging profitable prices for less healthy options.
Our goal is to match the shelf price of products in Katherine Woolworths. If essential items are stocked in the stores, but not in Woolworths, we heavily discount them also. We chose Katherine because this where most people go to do their bigger grocery purchases, and we hoped that by matching their prices, people would shop in their community store instead of travelling to Katherine, and therefore keeping money in the community.
How to make a profit with low prices?
Our aim is for the stores we manage to be financially viable social enterprises by reducing prices as much as possible without jeopardising financial viability. Encouraging people to buy locally through reduced pricing provides a vital source of income for the store owners who stand to service the whole community. Shopping locally also saves money on petrol to travel to the nearest centre which can in turn be spent on affordable groceries
We understand lowering prices may negatively impact profits in the short term, but in the longer term, it is a far better model for both financial viability and flow on social benefits. Economies of scale show the greater the number of people who shop locally will drive down store prices and ensure money stays in the community.
Going forward
Our model of discounted essentials requires ongoing analysis of shopping behaviour and financial outcomes. We need to remain flexible in our approach to ensure our stores deliver on the mandate of delivering both financial viability and social benefits.
Mob’s Choice is a relatively new initiative and time will tell how much shopper behaviour will change once the COVID19 increased jobseeker payments are stopped. We are confident however, the shift in shopper behaviour to buy locally instead of travelling to Katherine will continue so long as essentials remain heavily discounted.
AIG will continue to work closely with community to ensure the right range of products and the right pricing strategy is applied.
