This week that appeared to change, however, as Sainsbury’s and Tesco launched a war on... their branded suppliers (see p4). On Monday, Sainsbury’s described the battle as “Darwinian”, urging customers to move away from brands to embrace its own-label products, in a report signalling “the extinction of big brands as we know them”.
In the meantime, Tesco launched a new feature on its website – supported by TV advertising – prompting customers to try a cheaper own-label (or branded) product when it selected a favourite. Try to buy Warburtons and it will actively suggest own label. Try to buy Anchor and it pushes Kerrygold.
I had expected a full-scale war, at some point, between the supermarkets. What I hadn’t expected was for supermarkets to go out of their way to damn the products on their own shelves.
Brand owners spend millions on advertising to gain the support of the supermarkets – without which they are very unlikely to be stocked. They invest further millions on trade investment programmes. They plough in millions adhering to their supply chain demands. And, let’s face it, they make the supermarkets millions with their higher-value items and the innovation and excitement they bring to the market.
So to go out of their way, so blatantly, to undermine brands, seems a trifle, well, ungrateful. Maybe they are doing this because the margins on own label are greater. But with buyers being targeted on value, and the industry’s obsession with like-for-likes as a benchmark, as one supplier says, it shows how desperate they really must be.