>>Asda must act quickly if it is to win back customers from Tesco

It seems a little odd to see so many commentators saying that the new boss of Asda faces some pretty big challenges. After all, the Wal-Mart affiliate is still a growth business, hugely successful and remains one of the main jewels in its international crown.
But the days when Asda was growing like Topsy are over. And, as we reported last week, arch-rival Tesco is now going in for the kill with an uncompromising marketing campaign focused on price. It is trying to out-Asda Asda - and the tactic appears to be working. TNS switching data shows Tesco has decimated the competition in the past year, stealing £1bn of business from its rivals (and £133m of that from Asda).
Finding ways of winning new customers and bringing back some old ones will be top of the list of priorities for Asda’s new man. Easier said than done, of course. As outgoing boss Tony DeNunzio told us last autumn, unless the regulators change their views on the market, and allow Asda to swallow up a rival, it will be impossible to get the space needed to catch Tesco.
Asda does have some options. It could give the green light to a move into new trading territories with standalone clothing shops and non-food stores. It could persuade Wal-Mart to provide the cash to acquire Matalan or Littlewoods. It may yet be able to persuade Sir Ken Morrison to sell his unwanted stores in Northern Ireland. And, most risky of all, it could make a strategic U-turn and enter convenience with stores that are smaller than its current minimum size of 15,000 sq ft. But Tesco is looking at many of these options too, so the new boss of Asda needs to make some quick decisions.
The other big issues facing the business are more to do with marketing - and arguably easier to tackle.
By ditching the hapless Dotty, and a campaign based on some pretty mixed messages, Tesco’s marketing has been rejuvenated. Price is a simple message to get over to consumers - and it’s one with which Tesco now seems to be bombarding consumers. But surely this is Asda’s heartland? As our story on page four confirms, the chain remains Britain’s cheapest grocer. And with the simpler, and more impactful, EDLP+ trading platform revealed in our issue last week, it will soon have even more to shout about in store. Asda’s new boss just needs to decide how best to take the fight to Tesco.
Squaring up for a fight