Price will continue being a key battleground in grocery next year, according to Tesco marketing director Tim Mason.

In the week Tesco unveiled £60m of price cuts on 350 products, Mason said pricing pressure would continue in 2004 as the food retailers used price to drive trade.

“Tesco and Asda are driving trade by investing in price and the rest of the industry is having to respond. We want to do it first, causing competitors to worry how they respond while we concentrate on trading,” he said in an interview with The Grocer.

Tesco’s latest round of price cuts began on Monday (Sept 1) with an average 12% drop in price. Some products have been slashed by 46%.

Reductions are across the business including fruit and vegetables, ready meals, meat, wine, homewares and toys. According to Mason, Tesco tends to reduce prices at this time of the year, as people get back from holidays and there is a back-to-school sales lift.

“We want to get in a good position in the run up to Christmas and put others under pressure,” he said.

While Tesco has identified price as a key driver, Mason said that other factors would be important if food retailers were to continue growing. In particular, he highlighted the need to simplify the shopping experience.

Tesco has already started doing this through initiatives such as self-checkout. “The world is a different and busier place. We need to de-stress the shopping experience and make it easier for customers.”

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