“There’s no place like home. There’s no place like Tesco.”
I sometimes shop for food at Tesco, sometimes I go to Waitrose, Sainsbury’s, Marks and Spencer or even, on occasion, Morrisons. I often go to the closest store but not always. Sometimes, I am swayed by other things.
When we buy things we all undertake a trade-off analysis. We balance the various things we want from the experience and at any one time, for a particular purchase, we choose the best basket of benefits for us. Convenience, of location, not just being able to buy everything under one roof, is quite important for me. For instance, I never shop at ASDA or Walmart or whatever it is called these days, as there isn’t one near me, as far as I know.
From time to time, I will buy food in M&S because I have bought into the “value” proposition that they have very carefully developed over the last decade. A bit of me actually believes that “it’s not just a chicken, it’s a so-and-so chicken”. They also have a strong environmental policy that resonates in my deliberations somewhere.
Like M&S, Waitrose is an expensive place to shop for food. I have never been able to rationalise their high prices with the “never knowingly undersold” promise of the John Lewis group but I get great service and quality there, although I know I have to pay for it. And I go to Morrisons for fish because it is good, at least locally.
However, the big players in UK retail are Tesco and Sainsbury’s and I can think of no clear reason, apart from location, why I would choose between them these days, although I could almost hit the checkout person in Sainsbury’s every time I am asked if I have a Nectar card. I never really got into the Tesco Clubcard thing either, although it did at least give the impression that Tesco wanted a relationship with me, to offer me something more personal, but I think that has been somewhat overtaken by events and anyway, Tesco didn’t really mean it.
Tesco has just launched another round of the Big Price Drop and Sainsbury’s Brand Match guarantees the lowest prices. What is there to choose between them, apart from a few pence? They are just focusing on price rather than trying to differentiate themselves on some other, perhaps emotional, personal or other less tangible brand quality. That is a big mistake for them although pretty good for all of us because, as long as they are genuinely competing on price, we will get cheaper food, from both of them.
Sainsbury’s made a move in the direction of developing the emotional element of the brand with their association with Jamie Oliver, but then they blew it by falling-out with him, never really realising what they had or building on it.
There is evidence that the status quo isn’t working too well for Tesco. After their profits warning earlier in the year, they have now “shaken up” their marketing team and brought in David Wood, the commercial director of the Hungarian operation. It will be some coup for Wood if he can do something to change the current state of competitive affairs.
Wood has a strong brand management background so, hopefully, it will be second nature for him to separate the functional and emotional benefits of the brand and to actually manage them. As a brand, Tesco these days is all function and no emotion – all brain and no heart. To both describe what I mean, and illustrate what they should be doing, think of the Tesco brand as the Tin Man from the Wizard of Oz. My guess though is, that just like the Tin Man, Tesco really does have a heart, it just needs to rediscover it and tell us all about it.
Good luck Tesco, you have a classic challenge in front of you.