10 Aug Which retailers deliver the best value for consumers?
We work with many of the world’s leading brands, especially retail private brands, and not surprisingly, all of these retailers want to ensure that they deliver maximum value for their customers. We provide solutions to help retailers benchmark their products. We provide solutions to help retail private brand teams better engage with suppliers and develop or re-develop products quicker and more efficiently.
What does value mean to customers?
But, when asked the question “which retailer delivers the best value for consumers?” the challenge is to understand against which yardstick the said retail private brands are being measured.
I remember reading in Which? that Waitrose had once again been rated as providing the best value.
My teenage son reading over my shoulder commented that this must be wrong because Waitrose weren’t the cheapest. So ensued an interesting discussion on the subject of cost vs price vs worth vs value. In hindsight, maybe that was the discussion which made him decide to give up Business Studies, we will probably never know.
I personally feel that consumers are actually being let down by the media’s desire to league table everything and everyone. From school performance to doctor appointment waiting times. And as such, no surprise, here is a league table for the ‘best value’ retailers. However, given the debate over cost vs price vs worth vs value then how can someone draw such a comparison without defining ‘value’?
Price vs value
Post 2008 economic crash there was an inevitable spotlight on price. Yes, I mean price and not value in this instance. With shopper loyalty being eroded by the continued increase in convenience stores and online retail, a number of retail brands arguably lost their way; products became too ‘samey’ and the focus became too much about price.
Therefore I am going to side-step the question ‘Which retailers deliver the best value?’ and instead welcome the fact that retailers are increasingly re-discovering their own values and reflecting this in their private brand products.
What are UK supermarkets defining their values as?
Aldi and Lidl have taken significant market share as ‘discounters’ but with a limited product range by comparison to other retailers. If your yardstick is choice then discounted or not, you will not get the value you look for. Whereas I remember listening to Talk Radio when one shopper phoned in to say they positively welcomed the lack of choice at Aldi, not because of the associated discount price but because it made shopping quick and simple. This shopper positively valued not being confused with too much choice. Aldi’s challenge will be to maintain this as they increase the range of premium listings.
Waitrose by comparison has always been recognised for premium products but to cement this announced (April 2016) the launch of its first ever premium range. “This will unequivocally be the best supermarket range in Britain,” says Rupert Thomas, the marketing director of Waitrose.
By contrast, the Co-operative Group has announced a major overhaul of its branding, returning to the old “clover leaf” logo and claiming to return the group back to its values. The move is to make Co-op’s convenience stores more competitive. Recent Kantar figures showed that shoppers visited Co-op food stores more frequently than any other grocer. It is not all about price.
The announcement by Sainsbury’s to stop multi-buy deals re-asserted the industry move away from price, towards value.
One View of products for understanding values
When we talk to retailers about our ‘One View’ concept, an essential part of this is to understand how they define ‘value’ for their brands. The UBX concept of One View is to combine multiple sources of product feedback such as call centres, social media, returns, sensory panels, benchmark assessments etc, consolidated into One View of product performance. And ideally to then share this with private brand suppliers to work as ‘One Team’ around quality, consistency and innovation.
Importantly this One View is different for each of our retail customers depending on how they measure value for their customers. Indeed for a single retailer this view can vary dependent on sub-brand or category depending on how they intend to win. Is value price per serving? Is value the greatest choice? Is value the healthiest? A product cannot be all things to all people.
Choosing convenience over value
The fact that as individuals we may re-assess these values on an almost daily basis depending on what is happening in our lives, is why convenience stores are just so, well convenient. We have four big name convenience stores within a three minute walk of our head-office, so I witness this every day as colleagues decide which store to visit today.
Consumers will always have one eye on price, but what is good is to witness retail brands being re-invented to give consumers this diversity. This choice. This value.