This week rumours were abound that Tesco will launch its new discount chain later this year. Why? Online adverts appeared for customer assistants for new stores with the following wording: “The new retail format will be operated separately from the core Tesco business and as such benefits offered will be different from those offered at Tesco.”
With the retail industry facing a huge shake up and disruption over the past few years, brands have been looking at how to successfully transform to continue to generate revenue and win customer loyalty. And with discount brands Aldi and Lidl leading this disruption and change, it comes as no surprise that traditional supermarkets are looking at what they can do in this space.
The interesting conversation is around the branding of the discount chain, as Mark Dodds, chair of the Chartered Institute of Marketing Food, Drink and Agriculture Committee, correctly articulated, “Getting the branding balance right will be vital if Tesco is to succeed in taking on the discount supermarkets. If the brand is too different it will have a tough job becoming established in the market. On the other hand a brand too close to its core runs the risk of cannibalisation of current sales.”
Watch this space!
Getting the branding balance right will be vital if Tesco is to succeed in taking on the discount supermarkets.