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Tim Murray Tim Murray, Associate Director

We know that the multiples are better than discounters in just about every area. Research shows that Tesco, Asda, Sainsbury’s and Morrisons offer a far superior range, better service, shorter queues and a better taste than Aldi or Lidl.

Yet people continue to shop at discounters. Which tells me that they don’t always care about facts - they care about experiences.

Now that’s partly to do with perception and things like expectation-setting – people’s sense of how positive their shopping experience was is directly related to how positive they expected it to be, so the shops with the lowest levels of consumer expectation (i.e. Lidl and Aldi) find it easier to come off looking good.

However, I believe that this element of ‘passion’ is a key factor. People’s shopping habits (grocery or otherwise) are often more likely to be emotional than rational – experiential not factual. They want a story to tell. People don't just want practical benefits; they want to be part of a bigger story.

Think of those friends who regularly brag about the amazing bargains at Lidl, recounting the great deals they got to anyone who’ll listen. It’s partly about price but it’s also about the story of it all and the feeling of success. Perhaps it’s the British tendency to champion the perceived underdog and they feel superior for ‘getting one over’ on the bigger stores. Whatever the reason, they’re personally enthusiastic about their shopping experience and keen to share it with others.

So multiples need to replicate that. They need to recognise that experience is often a bigger motivator than fact and give customers a reason to feel passionate about their brands.

Tesco’s farm range is a good example – it positions itself as higher in quality than their previous entry tier but at a price point that competes with the discounters, plus the authentic, British-grown and healthy style of the branding makes customers feel good about buying it. The multiples can capture shoppers’ imagination and offer more than just a bargain.

So, when thinking about how to beat the discounters, multiples must make sure that they don’t get too distracted by trying to win in areas like price. Offering a great shopping experience and creating passionate shoppers is key to success.

 

To read more, visit beatthediscounters.com and download the full ‘Beating the Discounters: myth-busting and the £4billion opportunity’ report.

 

Download the full report now

 

Andy small Andrew Hawes, Founding Director

Once stigmatised as down-at-heel supermarket chains, Lidl and Aldi have reinvented themselves by convincing customers their aisles are stacked with superior quality products at prices the UK’s big four of Tesco, Sainsbury, Asda and Morrisons struggle to match.

That proposition enabled the discount duo to steadily gain market share as consumers, whose spending power had been curbed by the recession and prolonged wage stagnation, became more price-conscious.

Yet research shows price is only fourth on shoppers’ priority list – behind proximity, range and habit - and with over 90% of discounters’ customers also visiting a higher-end supermarket, there’s a chance for a Big Four comeback.

To engage in a pure price war would be foolish – the discounters are doing just that, achieving 5-25% discounts versus the conventional chains, who on average would forego £1 billion in profits to reach parity.

Instead, the multiples need to remind customers of the advantages of shopping at one store with a full range, better service, equal or better quality and comparable prices. They also need to ‘myth-bust’ the perception that the discounter’s products are comparable.

 

Our own research of 40 people tested products from eight supermarket ranges (including dairy, confectionery, juice, produce, meat and fish), comparing both the multiples’ entry-tier and mid-tier products to Aldi’s and Lidl’s. The results showed a greater percentage of people still ranked the multiples’ entry-tier and mid-tier products above those of the discounters. Asda’s cheddar cheese was the cheapest and topped taste tests – yet customers are unaware of the actual difference in quality. 

Tesco’s farm range has begun to give shoppers a reason to feel passionate about the products they buy from the store again, in the same way they might recall an unexpected bargain obtained from a discounter to their friends over dinner. Positioned as higher quality than Tesco’s previous entry-level tier and priced to compete with discounters, the farm range makes shoppers feel enthusiastic about their buying decisions again.

If the full facts around quality of product and price are promoted to customers, along with the existing areas around range and habit where the multiples are already superior – how can they continue to lose market share?

 

To read more, visit beatthediscounters.com and download the full ‘Beating the Discounters: myth-busting and the £4billion opportunity’ report.

 

Download the full report now

 

 

Aldi and Lidl are showing continued growth, but with 94% of customers shopping at both a multiple and a discounter, and with price only the fourth most important factor to a customer, the likes of Tesco, Asda and Sainsbury’s can still beat the discounters.

Our 'Beating the discounters' report outlines the steps we need to take now to win back market share and provide a better customer experience.

Download the report now

As featured in the Municipal Journal here:

This autumn, every health and care system in England will start to implement Sustainability and Transformation Plans (STPs). Key areas of focus will be on reducing acute admissions and delayed transfers of care, which recent NHS figures and the latest monitoring report from the King’s Fund, show are rising. The demand created by older people with complex needs accounts for much of this increase, and better integration of care and providing alternative settings to lengthy hospital stays are widely considered to offer the best opportunities for tackling the problem.