Talking Retail Grocery and product news for independent retailers
That was the message from Nick Miles, head of global insight at the IGD grocery industry research provider, speaking at today’s IGD Insight & Impact conference in the City of London.
He pointed to examples including Carrefour in France, which had focused on strengthening its price position.
The supermarket has locked down prices of 200 products, frozen the cost of 100 everyday essential own-brand lines, and introduced a range of lines at €1 or less.
In Germany, Edeka was advertising the fact that “there’s a discounter hidden within every store”, while in the Netherlands, Dirk was promoting its lowest-prices-in-the-market positioning at the entrance.
Other chains were either adding loyalty schemes or updating their existing programmes to offer more value
These included Albert Heijn in the Netherlands, whose premium loyalty scheme offers added discounts for subscribers who pay a fee to join.
There was also a big push globally for own-label, Miles said, in a bid to mitigate cost-of-living pressures.
“The cost-of-living crisis will continue to be a primary driver of how retailers think about their private label going forward,” he said.
Retailers were also investing in efficiencies and automated processes in a bid to cut costs.
Ashwin Prasad, group chief product officer for Tesco, said: “It’s never been more difficult for consumers as it is right now.
“People really need help, and they need help now.”
He said Tesco was beginning to see a definite change in shopper behaviour, with more trading down and taking advantage of cheaper own-label prices.
Others were moving from fresh to frozen in a bid to cut waste, and Tesco is offering a “five for four” deal in frozen lines to encourage shoppers making the switch.
He said Tesco would continue to focus on its Aldi Price Match campaign, Clubcard pricing initiative, and everyday low pricing, particularly on brands.
Basket size was also deceasing, Prasad reported, as shoppers sought to budget by shopping more frequently.
Availability was also crucial, he added. “Value is one thing but so is making sure the products they are looking for are on the shelves as shoppers make that transition.”
Volatility in the market was becoming the new normal, Prasad suggested, and retailers would need to re-think the way they organise their supply chains accordingly.
