What is it about Aldi? When Asda introduces Wagyu ribeye beef (£24.55/kg) to its shelves (sourced from the UK), it barely warrants a mention in the media. When Aldi announces it is introducing a tiny number of Wagyu ribeye steaks (50 per store, sourced from New Zealand) via its Specially Selected range (£30.79/kg), it is splashed all over the Mail, swiftly followed by a herd of coverage in other media about the growing middle class appeal of the German-owned discounter.
“Aldi’s crowning achievement is persuading the middle classes that it is the last word in über-chic grocery retailing”
Adam Leyland, Editor
This is the crowning achievement of Aldi: persuading the middle classes (and the middle class papers) that it is the last word in über-chic Primani-style grocery retailing.
Asda can’t do it. Neither can Iceland. But Aldi’s tactics might have been possible for Morrisons. The plucky underdog surprising the market (and the all-important media) with inexpensive investment in selective halo products. It even had the chance to buy Iceland - which would have delivered convenient high street locations and a tailor-made discounter fascia. Instead it bet the farm on its stores (and disastrous distractions like Kiddicare). The shops were previously quaint. But the misty veg experiment has felt like expensive dogma (you wouldn’t find misty veg in Aldi) and the only surprise about Sir Ian Gibson’s departure is that it’s not till next year.
In improving the look and feel of its stores Tesco has arguably fallen into the same trap - though there has been an additional imperative from the decline in non-food sales from its significantly larger stores. But it’s also invested impressively in its food offer. And after walking away with a ton of Gold medals for its Finest range at The Grocer’s Own-Label Awards a couple of weeks ago, it might seem puzzling that the obvious improvement hasn’t translated into sales. Perhaps that’s the reason for the marketing team reshuffle.
But the bind Tesco CEO Philip Clarke is in that while he’s right that recent pricing investment has led to worsening like-for-likes, the media neither understands nor wants to listen. The tanks are parked on Tesco’s lawn. The media is baying for blood; Tesco is fighting a Cold War.