One Big Change Whole Foods is Making to Get You Back

There are three Whole Foods within one mile of where I live.  Yet, I rarely go to any of them.  I used to go to Whole Foods, mostly to buy produce.  But, I tired of spending $20-$40 for a bag of fruit and vegetables.  So, I gradually found retail alternatives for produce that had similar quality at a lower price.  And, I would also pick up other non-perishable items while I was already at that other store.

Well, it looks like I wasn’t the only one.

Whole Foods recently announced a new pricing program in five Austin, TX stores where they are lowering prices on approximately 400 perishable items, like produce. It turns out that people actually view perishables pricing as a leading indicator of how much other items in the store cost.  The impression that perishables are highly priced gives the impression that all products in Whole Foods are also highly priced.

Interestingly, Whole Foods has spent the better part of the last few years actually lowering prices on non-perishable products.  In particular, the 365 label was supposed to demonstrate quality and value.  But consumers didn’t notice.  And the “Whole Paycheck” perception still stuck.

In essence, the price of produce gave consumers their prevailing impression of overall pricing at Whole Foods.  And, when non-produce prices were lowered, consumers didn’t notice because their leading indicator of pricing throughout Whole Foods did not change.

Every business has leading indicators that customers extrapolate to form an overall impression.

A recent client, a struggling Midwest software company that developed medical practice management software, focused on their leading indicators and transformed their company  Through much research and analysis, we realized that their customers, who are doctors, viewed the amount of software complaints and questions from their office staff as a leading indicator of the quality of the software.  So, we changed the User Interface to make it easier for office staff to use the software, and emphasized the company’s classic Midwest values of trust and reliability over the usual emphasis on graphics and features.

The result – sales doubled in the first two months!

Focusing on the office staff experience as a leading indicator of overall software quality turned the company around.

So, now ask yourself – what are the leading indicators that your customers look for in your company?  And, are you using those leading indicators to build the perception that will position your company for further growth?