Hi-lo isn’t the answer for grocers, and neither is EDLP. We recommend an alternative model in which everyday prices are close enough to competitors and promotions are focused on specific goals — like driving traffic or increasing trial of private brand — rather than offered indiscriminately as a mechanism to paper over unreasonable everyday prices. We call this “everyday fair price.” Under the old model, insights about how well different promotions actually performed — How many of these items are contributing to full shops? How often are these items included in baskets with a desirable margin? How much did this promotion cannibalize sales of the private brand? — were largely irrelevant because running them came with compensation other than sales. In a modern model, every promotion has a purpose. Grocers that take a traditional approach to promotional calendars are likely promoting too many products, too frequently, at discounts that are too steep. How responsive shoppers are to a given promotion varies dramatically based on the category and the item. For example, meat promotions often drive trips; promotions of canned vegetables rarely do. It follows that canned-vegetable promotions should be infrequent, fully funded and low-discount, whereas meat should be promoted on the cover, at aggressive price points, for all occasions. The opportunity to focus less on promotions and more on everyday prices will be especially important in markets heavily penetrated by discounters, but even in other markets, most grocers will find their price perception needs retooling. Our research shows that overall “value for the money” perception generally comes down to everyday prices rather than promotions, so more focus needs to go to the former than the latter.