Did the earth move for you?
For years, Tesco was able to surprise us and delight/terrify us with its bold initiatives, but it’s lost the knack of late. So, after a frenzy of Twitter-based speculation last week and six months after Tesco CEO Philip Clarke signalled his dissatisfaction with Tesco’s UK performance we were expecting something Big.
Having had a few days, however, to digest Tesco’s Big Price Drop, I’m feeling underwhelmed and a bit baffled. The new promotion is hardly original: the logo bears a striking resemblance to Morrisons’ Price Crunch. The TV ad feels dated. And in today’s paper Tesco was promoting tins of Roses, Quality Street and Celebrations, now, at £4.50, ‘less than half price… and double Clubcard points too’.
I know Tesco said double Clubcard points will carry on till the end of October, but running these two messages concurrently seems strange when UK boss Richard Brasher was (rightly) suggesting last week that consumers were confused by all the promotions, and that the Big Price Drop had been conceived to help address this.
It’s also odd that, having said the majority of cuts, and the steepest cuts, would focus on own-label goods, analysis for The Grocer by BrandView.co.uk shows 60% of the 3,000 items included in this week’s Big Price Drop are branded, and only 6% of the 100 biggest reductions are own-label.
Inevitably, a lot of speculation surrounds who’s going to pay for the cuts. But the suggestion that Tesco has ‘gone nuclear’ can now be put to bed: if the recovery in Tesco’s share price following last week’s Twitter-based losses wasn’t enough, the fact Tesco came third (behind Asda and Sainsbury’s) in this week’s Grocer 33 tells you everything you need to know.
It’s also interesting that the items Tesco has chosen aren’t personally directed towards the ‘price-matching’ efforts of Waitrose or Ocado - despite Ocado’s share price crashing.