2 Grocery Chains Plan Cuts in Newspaper Ads

Plans by Vons Co. and Lucky Stores to greatly reduce newspaper advertising in the San Diego market--and replace it with ads mailed directly to consumers--portend even tougher times for already struggling newspapers in Southern California.

This month, Vons and Lucky both plan to at least temporarily cut back on the multipage advertisements that appear in weekly food sections and Sunday newspapers.

Particularly hard hit will be the two Copley-owned newspapers, the morning Union and afternoon Tribune, which could lose millions in revenue from two of their largest advertisers.

“If this test is successful and goes through 1992, we could lose a couple million dollars a year,” said Dexter La Pierre, manager of display advertising at the two papers, which are scheduled to merge early next year. “If we don’t replace that money, I expect the general manager would want to reduce costs.” La Pierre declined to speculate how costs might be reduced.

For the time being, both Vons and Lucky do not plan to reduce their advertising in the San Diego edition of The Times, which is purchased as part of an advertising package.

Executives in the grocery and newspaper industries speculate that a shift in supermarket advertising away from newspapers could eventually find its way into the Orange County and Los Angeles County markets, affecting such papers as The Times, the Daily News and the Orange County Register.

Beginning this week, Lucky said it will cut its newspaper advertising in half in the San Diego market and replace those ads with direct-mail promotions.

“This certainly is a trend,” said Judy Decker, communications manager for Lucky Stores. “This is the first area we have tested this.” The Los Angeles market could be next, she said.

“The idea is to focus on target segments (of consumers) that make up the population in a given store’s area,” said Miles J. Turpin, chairman of Lucky’s Los Angeles agency, Grey Advertising Inc.’s Western division.

Vons will be cutting way back on its newspaper advertising in San Diego within the next few weeks. “The goal is to test to see if we can reach a broader audience,” said Victoria Sanders, a Vons spokeswoman. “San Diego is a comfortable size for a test like this.”

Vons usually runs from five to 10 pages in the weekly food sections of the Union and Tribune. But, under Vons’ new ad plans, it would be running just “a couple” of pages in these weekly sections, La Pierre said.

These full-page ads sell for about $7,000 each. “It’s the equivalent of losing a major department store,” La Pierre said. At the Los Angeles Times, only department stores and entertainment advertisers spend more on advertising than supermarkets.

Advertising executives at the two grocery chains explained Monday that their individual stores are often so different from each other that consumers may be best served when the stores separately mail advertisements to consumers in their own neighborhoods.

But newspaper executives pointed out that, in the competitive Southern California market, the prices on many food items change so rapidly that mailers could be out of date even before they are received by consumers. They also noted that November and December are usually the busiest times for grocers, and this could be a risky period to experiment with advertising changes.

Robert Gaines, vice president for food marketing at the Newspaper Advertising Bureau, said at least one major grocery chain--A&P; in three Southeastern states--made the switch from newspapers to direct mail and switched back to newspapers early this year.