This article examines various pricing strategies that grocery stores utilize to remain competitive.

Getting Started

Appropriate Subject Area(s):

Pricing, business management, competition, marketing

Key Questions to Explore:

  • How do pricing policies make a store more or less competitive?

New Terminology:

  • Football prices, ad collision, ad match, provide coverage


Study and Discussion Activity

Introduction to lesson and task:

The lesson examines the intensifying pricing battle in the fast-consolidating Canadian grocery sector.

Action (lesson plan and task):

  • Review the marketing mix with the class: Four P’s Product, Price, Place and Promotion.
  • Review pricing strategies with the class, including:
    • Keystone pricing
    • Cost-plus
    • Penetration
    • Skimming
    • Meet or beat the competition
  • Discuss the notion of meet or beat the competition and explore how a store does this. What are the implications?
  • Distribute the article for reading.
  • Have students individually prepare a charted summary of the article highlighting the key points.
  • In groups of four, have the students share their highlights and discuss their understanding of the article.
  • As a class, discuss Loblaw’s positioning within the grocery field.

Consolidation of Learning:

  • Have students write a one page paper on why they think the Competition Bureau is concerned about Loblaw’s pricing practices.
Success and Additional Learning

Success Criteria:

  • Students understand price competition and can distinguish between the various pricing strategies.

Confirming Activity:

  • Have students examine three products commonly used in their household and compare the prices either in-store or online at three different sellers.  Have them share with the class what they discover..