Posh is back. And posher than ever.
As the summer drew to a close, Waitrose began the rollout of a new-look, 450-strong Duchy Originals range. Hot on its heels the Co-operative Group launched Eat In, a range of ready-to-cook dishes and prepared vegetable accompaniments. Next, Iceland brought out a new range of premium restaurant-style ready meals.
And in the same week that Sainsbury's relaunched its 1,141-strong Taste the Difference range, Asda unveiled the results of an even more comprehensive reformulation programme resulting in a new, improved 3,500-range mid-tier offer called Chosen for You, as well as additions to its Extra Special line-up.
Of course, some of the products have received little more than a lick of new paint. But it's clear from the scale of own-label NPD and the unlikely ingredients, in some cases that quality is the new battleground. "Only recently, value meant price alone," said Asda CEO Andy Clarke at the Chosen for You launch last week. "But consumers rightly ask we add two other dimensions quality and service."
So, what's behind this switch of direction? To what extent do the retailers' strategies differ? And where does price and promotion fit in?
It's partly a question of timing. At the start of the autumn push, as the nights settle in, we have entered the so-called Golden Quarter, as the all-important Christmas period approaches. But retailers are also responding to a change in consumer demand: cash-strapped diners are curtailing evenings out in favour of a few home-based treats.
"At the start of the downturn," says Mike Watkins, Nielsen's senior manager retailer services, "it was all about lowest price, but consumers have grown tired of average fare and a slight improvement in the economy has given many the confidence to indulge a little in what they fancy."
And, as the supermarkets step up their efforts to net the more discerning diner, the buzz gets louder when the words 'quality' and 'restaurant' are used together. The Dine in for £10 promotion launched by M&S at the onset of the recession was followed up by Waitrose at the start of the year with Menu. Now Sainsbury's has launched a sub-brand within Taste the Difference called Bistro. The offerings including dishes such as lamb shanks with red wine jus and pork belly with vintage cider are "restaurant-quality fare", says commercial director Mike Coupe.
Clarke is making similar "restaurant-quality" claims for its new Extra Special dishes including beef in chianti white wine sauce with mushrooms with the range of ready meal lines doubled. "Customers will buy it for a weekend treat."
Even Iceland has aspirations, describing its 10-strong range of tendercooked dishes as "restaurant-style, to give our customers an affordable treat at home".
Retailers need no encouragement to step up efforts in premium own label, says Diageo MD Simon Litherland. "There's a quest to enhance margins, which are very slim on value products. If the demand is there supermarkets are sure to want to meet it."
Even Asda has changed its tune, having realised, late in the day, that its remorseless focus on price had driven away its hard-fought middle-class shoppers. "We think customers will pay more for the right product," an Asda spokeswoman insists, in explanation of the heady price points of its Extra Special ready meals range, with double servings coming in at £9, starters costing up to £4.50 and desserts typically £3. "We've invested in ingredients, provenance and cooking technique. We found customers are prepared to pay that higher price."
In the case of Waitrose, the chance to trade the customer up has involved licensing the Duchy of Cornwall's name to create a unique own-label tier consisting exclusively of organic lines. The initial 150-strong range will be extended to 450 by the new year. And Mark Price predicts the range will account for 7% of sales.
So where does price fit in this premium equation? Will shoppers need ever more dosh to go posh? The upmarket independent frozen food chain Cook admits that price positioning has become a real challenge. "The multiples have raised their game in prepared meals and also raised their prices to a level comparable with our everyday range," says Cook head of communications James Rutter.
So Cook has fought back by raising the stakes once again, with its new For Special Nights In range boasting dishes such as Haunch of Venison with Crushed Celeriac. "We wanted to re-establish our premium position. It's food of the highest quality and we believe customers are willing to pay a premium for it as it is still half the price of a gastropub dish."
But promotions will play a key role in establishing these lines. The much-copied Dine In For £10 meal deal introduced by M&S, which includes a main course, an accompaniment, a dessert and a bottle of wine really hit a chord with shoppers, says Assosia MD Kay Staniland. "Meal deals encourage consumers to try premium products and then shape their perceptions."
It's no surprise, then, that retailers have launched their new ranges on promotion. The Co-op is offering products in the Eat In range on a £5 link-save promo. Waitrose and Sainsbury's both relaunched their ranges with 25%-off promotions on selected lines backed by high-profile TV ads with Heston Blumenthal and Jamie Oliver. Iceland, meanwhile, has remained true to its core customer base by pricing its new range from just £1.50. Promotional activity is sure to continue on premium own label, says Staniland.
However, premium purchases will remain chiefly restricted to special occasions, says Coupe and when shoppers buy posh they also buy bog-standard. Sainsbury's fastest-growing range is still Basics. "About 50% of baskets at Sainsbury's contain both Taste The Difference and Basics."
It's a point reinforced by Ocado's move in the other direction. As Waitrose was unveiling Duchy as the new premium tier in its three tier own-label having enjoyed so much success with its Waitrose Essential range in the last 18 months Ocado has evidently decided that the Waitrose basics range does not go far enough for its customers. Bucking the premiumisation trend it last month launched a new 1,000-strong mainstream own-label range to broaden the online retailer's appeal.
Says Ocado director Jason Gissing: "We need to make sure we service the needs of large families doing their weekly shops. Of course we can still offer treats and the beauty of our model is we can sell exclusive and niche ranges such as Gail's bread, Daylesford ready meals and FooGo sandwiches but for us it's essential that we offer shoppers choice."
Own-label range: Chosen by You
Number of products: 3,500
On the menu: Ultimate Steak Pie
What they say: "We are sending a clear message that Asda will now drive as hard on quality as it does on price"
Own-label range: For Special Nights In
Number of products: Six
On the menu: Haunch of Venison with Crushed Celeriac
What they say: "Something rather special different from what you might get in a supermarket"
The Co-operative Group
Own-label range: Eat In
Number of products: 25
On the menu: British Elmwood Turkey Breast Steaks with Spinach & Ricotta, topped with a Herb Crumb
What they say: "Convenience without compromise"
Own-label range: Tendercooked Meat
Number of products: 10
On the menu: Two Duck Legs in Orange Sauce
What they say: "A great range of mouthwatering recipes all slow cooked for tenderness"
Own-label range: Taste The Difference
Number of products: 1,141
On the menu: 21-Day Slow Matured Roasting Joint
What they say: "Our development teams have travelled the world. We believe this is the best premium food available in any supermarket"