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Wal-Mart Seeking Agency for Marketside Concept

Up to Seven Agencies Said to Be Vying for Fledgling Upscale Fresh-Foods Store

By Published on .

BATAVIA, Ohio (AdAge.com) -- Wal-Mart Stores is talking to agencies about creative work for its fledgling Marketside convenience and fresh-foods stores, inviting as many as seven agencies on Friday to discuss the account, which is separate from the flagship retail brand, according to people familiar with the matter.
Marketside is an upscale but discount-focused concept Wal-Mart launched last month with four stores in the Phoenix area.
Marketside is an upscale but discount-focused concept Wal-Mart launched last month with four stores in the Phoenix area. Credit: Wal-Mart

It's unclear whether Interpublic Group of Cos.' Martin Agency, Richmond, Va., incumbent on the retailer's cornerstone Wal-Mart U.S. account, is among the agencies being vetted.

"We have not announced any plans regarding marketing for this area of our business," a Wal-Mart spokeswoman said, "but, as you can imagine, we frequently have informal discussions with a number of agencies."

Marketside is an upscale but discount-focused concept Wal-Mart launched last month with four stores around Phoenix, largely to counter the rollout last year of a similar format by U.K. rival Tesco, Fresh & Easy.

At 10,000 to 15,000 square feet, the stores are considerably smaller than a typical 50,000-square-foot supermarket and far smaller than a Wal-Mart supercenter, generally around 200,000 square feet.

While Marketside's logo bears a resemblance to the retailer's new Walmart brand identity being slowly rolled out around the U.S., it's a separate brand with no mention of its parent in the stores.

Though Marketside has been billed as experimental, it's a big experiment -- with some employment ads having raised the prospect of a 1,000-store chain that would generate $10 billion in annual sales. Even at that size, however, it would be dwarfed by its parent, which has $400 billion in global sales.

Tesco opened its first Fresh & Easy store in the U.S. in November and now has about 80. Even Tesco, however, views the concept as experimental, with one analyst citing a Tesco executive saying: "We know there's a gap in the market, but we don't know if there's a market in the gap."

Marketside stores emphasize fresh and prepared foods -- both areas relative weaknesses for conventional Wal-Mart supercenters. They include full-service delis, butcher shops, bakeries and fresh-cut flowers that come with a five-day freshness guarantee. The stores so far have more of an emphasis on branded products than Tesco or another similar competitor, Trader Joe's.

One advantage for Wal-Mart is Marketside's potential for growth in California, a market that's been underdeveloped for the giant retailer in part because of successful local efforts to restrict construction of supercenters.

Consumer reviews, at least online, appear to be favorable so far. At FreshNEasyBuzz.com, a blog devoted to Tesco's rival entrant but not affiliated with it, commentary about Marketside is positive.

"The prices aren't as low as the Wal-Mart Supercenter where I shop but that doesn't surprise me," said one poster. "The kitchen in the store is an interesting touch. The food cooking gave the store a nice smell."

The poster also noted the store had entered with a big promotional bang, selling $6 prepared foods for 6 cents.

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Contributing: Rupal Parekh
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