Martin's and American Express

For the first time, since I can remember watching the Super Bowl I saw local ads in place of National Super Bowl commercials. Martin's Grocery Store, which was founded in 1947 and owns 20 grocery store locations around South Bend, IN, was one of the local adds featured in this year's Super Bowl.

Martin's is considered by students to be on the higher end of the value chain, with Wal*Mart and Target being the places students go for their grocery store for cheaper, or less expensive items. With that being said, Martin's is the closest grocery store to the Notre Dame campus, so the convenience points go to Martins.

The biggest complaint that I have heard from students about Martins is not only the price, but also their unwillingness to accept American Express cards. I truly believe that Martin's is loosing out on a portion of the large student demographic in and around South Bend due to this decision.

Per Martins Supermarkets website, "Martin’s has continued to offer its customers added conveniences such as full-service Floral Shoppes and specialty departments, including Side Door Deli Cafés, which offer a full variety of hot and cold ready-to-eat menu items. Customers can even pick up their favorite Starbucks® beverage at over half of the Martin’s stores." I would argue that they would make more money, but accepting American Express cards, than they do from putting Starbucks® in their locations, which have Starbucks across the street.

Based on some quick google research, the AMEX fees for retailers are 2.5%, with the average fees for Visa and Mastercard at about 2%. My preliminary and basic research tells me that the veto vote on Martins, for students, particularly graduate student, looses Martin's more than .5%.

It is also commonly known that American Express holders spend more than the average credit card customer. So why turn away customer who are willing to spend more than average?

I don't know the financial or Martin's, or their profit margins, which are typically around 2% in grocery store chains; however, I do know that companies must be consistent all across the board of their value message. If customers are charged higher prices, given a premier "to go" section based off quality food quickly, they expect to pay for their food the way they would like to pay, whether that be cash, credit, or check.

The takeaway for a marketing manager is consistency among all touch points of a brand. From packaging, pricing, staff etc. I vote Martin's takes AMEX!