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Family Dollar Markets Message, Image In New Directions

The outside of a Family Dollar store.

Amid all the grim economic news the last few years, business has been quite good for dollar store retailers. The tanking economy prompted many people to give them a try.

The trend has helped Matthews-based Family Dollar's stock rise 40 percent in the last 3 years. Now, Family Dollar is trying to position itself for when the economy recovers. It has a new marketing strategy, and the company has hired a full-time ad agency for the first time in its 50-year history.

Family Dollar has been undergoing a steady makeover the last couple years. It launched a new logo and expanded brand selection in its roughly 6,700 stores.

Spokesman Josh Braverman shows off some examples at an East Charlotte store.

"We've increased our assortment from what would have been one brand of spaghetti to include a Ziti and some other pasta types, and increased our pasta sauces to give people more of a variety," says Family Dollar spokesman Josh Braverman.

But Family Dollar's marketing chief Don Hamblen says more needs to be done to change the company's image.

"If you look at consumer research, people have a perception that our brands are not the same as what they are at a grocery store or drug store."

As the economy improves, some customers might be more willing to pay a little more for items somewhere else - especially if they believe there's a difference in quality.

So Family Dollar has hired a large Kansas City marketing firm called Bernstein-Rein to help change that perception.

"The brand's gotta be contemporary, and brands that reinvent themselves and become relevant again to subsequent generations - we're in the process of doing that," Hamblen says.

Traditionally, Family Dollar has relied on print advertising. Hamblen says Family Dollar is re-evaluating that strategy as the newspaper readership declines. He says television ads might be in the company's future, but it's social media that's generating the most buzz.

Family Dollar launched its first major social media campaign in April with a toddler photo contest. Hamblen says Family Dollar is also texting customers about products. Like laundry detergent.

"We're literally messaging, 'Hey, this is the same Tide that you're getting at a grocery store, but you can get it here in a much more convenient setting at a better value,' " Hamblen says.

When the economy recovers, "A lot of people are predicting a new normal among consumers," says Dan Berthiaume, editor of RetailerDaily.com. That's a web site that examines trends in the retail industry.

"Shoppers are going to still be looking for the best price, the best value. And a lot of stigma that might have been attached by going out of the way to look for the best possible prices is now pretty much gone."

Berthiaume says these days more consumers take pride in finding the best price on a product. He also thinks the timing and demographics are just right for Family Dollar to get involved in social media

"30, 40-somethings are really picking up on Facebook usage a lot more than younger people." And he says those middle-aged adults are more likely to shop at dollar stores.

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