News America Marketing, the in-store advertising and grocery coupon agency that's owned by Rupert Murdoch's News Corp., just lost two huge contracts — Rite Aid and Family Dollar — to its arch-rival in the supermarket business, Valassis, according to a source who tipped Business Insider and a Rite Aid spokesperson.
The news doesn't sound dramatic unless you know the context: News and Valassis have been locked in a years long war for domination of the supermarket/grocery business, a battle which has so far cost News $656 million in legal settlements over allegations that it used antitrust tactics to drive competitors out of the market.
Since that settlement, News was sued by Dial Corp, alleging its tactics kept prices higher than they should be for in-store advertising and newspaper coupons. We speculated that suit could — and that's a highly qualified "could" — lead to a full-scale mutiny of News' in-store clients.
We reached out to all four companies. News and Valassis didn't reply; we've yet to hear back from Family Dollar. But Rite Aid confirmed: "To answer your question, effective Jan. 1 of this year, we began using Valassis."
Here's our tipster's info:
News America just lost 11,900 stores combined on Dec. 31 ... They lost the 7,200 Family Dollar chain based out of North Carolina and the 4,600 Rite Aid Drug chain based out of Pennsylvania. The up and coming Valassis instore division landed these two big retailer contracts and the addition of the Rite Aid chain is a big win for their partnership with Insignia. [Insignia is a smaller in-store agency that works with Valassis.] Valassis is now a 15,000 total store player.
Anyone else with information, please email me or use the comments below.
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