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Generic food debate...
Statistically most of us buy generic products but will not admit it, however with budgets biting, the shame in no-name is no longer.
Home and Away's Lyn McGranger would normally be paid to endorse brands but today she is lending her name to no-names and she was not paid a cent.
"I use generic beans, coconut cream, things like cling wrap," she said. "Cling wrap is cling wrap, for goodness sake."
No-name, No Frills, Home Brand, Coles Savings, generics in Australia are up by 6 per cent. Their share of the grocery market is 22 per cent which is an all-time high. Mix 106.5's Todd McKenny is attacking the prejudice that has long plagued the world of Black and Gold. "I think a lot of the generic brands are tastier than the others," he said. "I would go Black and Gold every time."
Gerry Harvey is a celebrity of sorts but you will not see his name anywhere near a generic label. "I see something from a third world country in a tin, I am not going to buy it," he said. "I don't know who the hell packed that in that funny place. "I am a brand snob."
Estimated to be worth more than $700 million, Gerry can afford to snub the cheaper generics but the retail king is adamant the real issue is not price, but quality. "You can go into any supermarket, it's disgusting. Why do you think we are all overweight? It is all the crap they sell in there," he said.
Private label products contain significantly more sodium, saturated and trans fats and are more energy dense than branded products. Previously, Dr Lynn Roberts from the Heart Foundation has slammed generic labels. Cheaper foods often equal cheaper, less healthy ingredients.
Nutritionist Zoe Bingley-Pullin compared generics with some everyday brands. "From a nutritional stand point, I would probably go more branded products," she said. The supermarkets spend big money pushing their private lines but one big retailer remains unconvinced. "It is cheaper because they put in inferior ingredients, it is not as good," Zoe said.
"The retailer makes more money, it is all about how much money you make."
Source: Today Tonight
Coles:Can the Brits save Australia’s fallen star?...
Australian grocer Coles is the greatest turnaround opportunity in global food retailing. And an all-star UK line-up is doing it. Jennifer Creevy learns how The prospect of escaping Blighty for the sunny climes of Australia has appealed to thousands of Brits over the years.
But for retailers the decision can be a tough one in career terms. While the UK may not have the good weather or relaxed lifestyle of Australia, it has what many rate as the best retailing in the world.
To leave Britain and take on one of the biggest turnaround jobs in world retail would to some seem like madness, but that’s exactly what the bulk of the newly established board of Australian grocer Coles has done.
Led by saviour Archie Norman, who worked with Coles’ parent Wesfarmers on its 2007 acquisition of the food group and remains as “chief coach”, the Australian retailer has attracted some of UK retail’s biggest names. And it seems to be working.
Having concluded the acquisition of Coles, Norman worked with Wesfarmers chief executive Richard Goyder to recruit a new management team for the chain, which had suffered from under-investment for more than 10 years.
Between them, the members of the new Coles team – most of whom were placed by headhunter Barracuda – have vast UK grocery experience. Managing director Ian McLeod was most recently chief executive of but previously worked for Asda. Operations director Stuart Machin has, and Asda under his belt, merchandise director John Durkan was at Safeway, and marketing director Joe Blundell and store format development manager Gavin Parker both had stints at Asda.
The British stalwarts have joined their Australian colleagues and thrown themselves into the five-year turnaround strategy. The retailer – which is being led by McLeod, who joined in May last year – has a tough journey ahead but just a year into the plan, the signs of change are already evident.
In its third-quarter results, Wesfarmers reported stronger growth than expected at Coles. Total food and liquor sales were up 7.6 per cent to Aus$5.3bn (£2.55bn) to the end of March, and comparable food and liquor sales were up 6 per cent. Like-for-like sales of fuel and convenience were up 6.7 per cent. The sales uplift is only the beginning though, and the team has a long way to go.
Global food retailing
But how did a neglected supermarket chain on the other side of the world, which had been overtaken and left trailing competitor for years, attract so much UK talent?
For Norman, the answer is simple. He says Coles represents “the greatest turnaround opportunity in global food retailing”. He explains: “From time to time situations come along where a great brand is not being allowed to perform. Asda was like that in 1991 and Sainsbury’s was like that post-Peter Davis, before Justin King came in.That was the challenge of Coles.”
Norman is quick to point out that UK retailers were not targeted per se. “We recruited on talent and not location,” he says. “While the team from the UK we have is very strong, we also have some very capable Australians in place in areas such as IT and logistics.”
Machin believes the reason Coles has attracted so many Brits is twofold. “The first reason to join a company is the people, and with Ian and Archie on board as well as Richard, you couldn’t hope for a better team,” he says. “The second reason is because you think you can add value. When I had a tour of the Coles stores, I knew I could add value.”
After years of neglect, Coles was in a “mess” by the time it was finally bought by Wesfarmers, says Machin. And rather than resent the fact that a team of Brits has been parachuted in to save the Australian retailer, he says the staff were relieved that a fresh management team had taken over.
“When we went around the stores we expected the first question to be something along the lines of: ‘What about the Australian talent?’ but that wasn’t even an issue,” recalls Machin. “What staff desperately wanted to know was how we were going to fix Coles.”
Another positive pointer was listening to staff. McLeod says: “The level of neglect caused the chain to be put up for sale and while we were careful not to come from the UK with preconceived ideas, the difference was that we have a senior team with retail experience talking to stores. The previous management was remote from stores and customers, therefore we had a warm welcome.”
Planet Retail senior analyst Rob Gregory says one of the big problems with Coles was the management before the buyout. It needed fresh blood. He cites a report by broker Citi’s Australian arm as evidence that the new management team was a good move.
Citi claimed in March this year that management had been the primary difference between Coles and Woolworths, giving weight to the new appointments. It said Coles’ problems were not structural, but were management challenges centred around service, store format, produce range and pricing.
A long term goal
Citi also said the retailer has a more lucrative store network than Woolworths and forecasts that Coles’ sales growth will eventually outstrip Woolworths. At present, however, Norman says: “We are a long way from declaring victory. Right now Woolworths is way ahead and just being as good will be a huge achievement. But we’re confident we’re on track.”
The five-year turnaround plan is “not for the faint hearted”, says Machin. “It’s a huge brand and huge responsibility to Australians. The goal is to give people a shop they can trust.”
The first phase is what he describes as “retailing basics”. After the team was put in place, it sought to tackle staff motivation, service, store environment, range and value.
Head office bureaucracy and over-centralisation had dogged Coles prior to the Wesfarmers deal and Norman says a focus on profit margins meant the retailer had lost the ability to offer value. “The business had turned away from the customer – it had become introverted,” he explains.
The steps that Coles has taken so far have therefore been driven by what customers want and what staff told the management they need. “99 per cent of the things we’ve done so far have come from the store staff and the customers,” says Machin. He likens the transformation to his experience at Asda. “UK grocers are highly competitive with each other – but while I was at Asda we weren’t obsessed with Tesco, we were obsessed with the customer,” he says.
Cultural shift
Some of the changes Coles has implemented have included making the business store-centric, implementing customer service training, cleaning every store and bringing in new equipment such as deli counters, refrigerators and trolleys, focusing on expanding its fresh food range and making subtle design changes.
“The teams didn’t feel empowered because of the central culture,” says Machin. “So we changed the name of the head office to the support centre for a start, then listened to what they needed and implemented it.”
He remembers one simple example. “We improved maintenance as teams told us that they would have to wait weeks under the old regime for small things such as a light to be fixed. Very quickly stores started to feel valued.”
Training was also key. Coles has just embarked on its first management trainee course – with 300 staff – and its first graduate trainee course, taking on 80 staff. The retailer is also finding that training cuts the wheat from the chaff. “Those that are with us felt really motivated by the prospect of training and those that weren’t up to the challenge have left,” Machin says.
He explains that while Coles is still searching globally for general and regional managers, it only wants staff with the right attitude: those who believe in the future of the brand.
The store environment was also cleaned up. Machin says: “It was a battle to get into the stores as they all had barriers and for some reason they were all obsessed with security, so shoppers’ bags were searched on their way in. It was a miracle that anyone bothered to shop there.”
The bag searches were ditched and the unwelcoming posters about stealing came down, replaced by traditional security such as cameras. “The stores are now welcoming, we’ve put flowers at the front, they are clean and the value message is clear,” he says.
Another important change was the drive for quality fresh food. “We want to be known as a great fresh food supermarket with a focus on quality and value at the same time,” Machin says. He believes that being a one-stop shop will give it an edge over the competition.
The new fresh range has built up the quality offer, according to Machin, and the retailer has strengthened its value offer with deals that are reminiscent of those in the UK, such as Feed Your Family for Story text0 (£4.80). He adds that the amount of promotions has actually reduced but the offers are better.
Testing the waters
Coles is also testing new formats including a value proposition to possibly replace value chain Bi-Lo. The new design “doesn’t look a million miles from a UK supermarket”, says Machin.
“Not everything will work so at the moment we are trying lots of new things,” he says. “In some places the main competition is Woolworths, in others it could be Aldi and in some it is independent markets, so we are adapting as we go along.”
Machin would still only mark the stores at about four out of 10, but is pleased with the early results. And while Norman is keen to point out the new team is “not reproducing Tesco”, Machin believes lessons taken from the UK have been essential. “We want to take the best of the UK and create the most efficient model,” Machin says. “We hope to be the best of Sainsbury’s, Asda and Tesco and add in the subtle differences in culture.”
Machin’s experience of UK grocers has stood him in good stead. At Sainsbury’s, where he started aged 16, there were “fantastic people who challenged and developed me”. At Tesco, he says he learnt about efficiency and keeping things simple. And at Asda he says he “loved the down-to-earth culture, the no-nonsense approach”.
Machin also believes Britain’s other grocers such as, and have qualities he will learn from. “The UK has the best companies and the most competitive retail environment in the world and there is so much I can take back in terms of merchandising, value, range and layout,” he says.
McLeod notes the “constant innovation” that the UK has, which Coles can learn from. “The focus on the customer means grocers have to constantly innovate to keep up with changes, and we are learning to do that here,” he says.
Coles is a long way from regaining its Australian crown but it is one step closer – to steal a phrase from Sainsbury’s – to being great again. And while you’d expect any Brit who emigrated to Australia to mention the sunny weather within the first 10 minutes of talking to those back home, the Coles team make no mention of it. There’s too much work to be done to enjoy the weather just yet.
Coles: a potted history
- Founder George Coles travels to the US to study best practices in retailing in the early 1900s
- In 1914 he opens the first Coles Variety store in Collingwood, Melbourne
- In 1960 the retailer opens its first supermarket in North Balwyn, Victoria. By 1973 Coles has achieved its aim of establishing a supermarket in every Australian state capital
- From the 1980s to the early 2000s Coles acquires several chains such as Liquorland and value player Bi-Lo
- At the beginning of 2007 Coles Group is put up for sale. Interested parties include private equity firm KKR
- Wesfarmers acquires Coles in November 2007. Asda saviour Archie Norman advises Wesfarmers
- Former Halfords boss Ian McLeod joins as managing director of Coles in May 2008 to lead a five-year turnaround. He recruits a team including UK stalwarts
- Coles has 700 eponymous supermarkets, 59 Bi-Lo stores, 860 liquor shops and 600 convenience stores.
Five-year turnaround plan
Years 1-2
- Build a solid foundation
- Create a strong top team
- Instigate cultural change
- Improve availability and store standards
- Improve value and customer trust
- Store renewal development
- Liquor renewal
- Tackle IT and supply chain infrastructure
- Efficient use of capital
Years 2-4
- Deliver consistently well
- Embed the new culture
- Team member development
- Improved customer service
- Improved efficiency
- Appealing fresh food offer
- Stronger delivery of value
- Scale roll-out of new format
- Auto replenishment completed
Years 4-5
- Driving the Coles difference
- Culture of continuous improvement
- Strong customer trust and loyalty
- Strong operational efficiency
- Innovative and improved offer
- Open new stores, new categories
Source: www.retail-week.com
Costco struggling to find suitable sites...
Patrick Noone, the Managing Director of Costco’s Australian operations, has reported his American-based firm is struggling to find suitable places for new properties in Australia - where the planning requirements are vastly different to those in the US. The retail chain, which will open their first Australian store at Docklands in Melbourne in the next few months, requires around three hectares for each outlet due to its operation as a large warehouse operation.
Costco Australia is searching the suburbs of Melbourne and Sydney for sites of up to 15,000 square metres, a search which has proved challenging. “When you think of retail in Australia right now, and you want to build a Woolworths or a Coles supermarket in a town centre, you are generally looking at 1000 or 2000 square metres of retail space, so in general you can put together a deal or find a space available,” Mr Noone told The Age. “When you come into a town centre like Prahran, for example, an activity centre, and you say you want 14,000 square metres and several hundred car parking spaces on three hectares, that land is generally not available.”
The company is ideally searching for sites around popular suburban hubs and is planning on building their second store in Australia’s most populous city - Sydney. The Sydney site has not yet been announced, although Costco is currently seeking an amendment to a draft Parramatta local environment plan to build on a vacant 69,000-square-metre industrial site in Camellia.
Source: www.ausfoodnews.com.au
Hard to sing Stand By Your Brand...
Ask 10 marketers what they mean by value and you will get 10 different responses, each cloaked in the opaque jargon the marketing industry relies on. When words such as value are put through the linguistic mangler the industry is struggling to define one of the core weapons in its arsenal.
A marketer told an audience recently that they "needed to valuate their proposition, going forward" in the recession. I think he meant marketers have to scrutinise what they are selling and how they are marketing to ensure it does represent value to its target market. Therein lies the rub; value is a very subjective measure. For all the talk of "value propositions" it is hard to find an exact definition of value. Consumers, however, appear to be more certain about what value means to them.
Research by The Leading Edge for the Herald found that 78 per cent of the 1500 people surveyed rated both quality and price equally as the most important attributes when assessing a product's value, followed by breadth of range and then in-store experience. Towards the bottom came brand, at just 29 per cent, with younger consumers who are more promiscuous in their brand choices, placing even less importance on it.
Even among the 55 to 64 age group, whose brand choices could be expected to be more ingrained, only 36 per cent regarded it as important. It could be argued that were it not for all the money spent on communicating a product's benefits above and beyond price, many brands could be faring worse in the present cut-throat environment. "Your brand can't just say 'I'm good' to get cut-through appeal with consumers. You have to say why you're good and be able to back up your claims with proof," says Leading Edge's director of client consulting, Seonaid Anderson.
Why bother then, when you can get instant gratification by slapping a red sticker on your product or a promise of 20 per cent more. Experienced retail commentator Stephen Kulmar recently bemoaned the plethora of value-based offers that said little other than "We are cheap". "I'd always thought it [value] was about the benefits over price. Now it appears it's just price, price, price." All very well when the short-term goal is volume growth but what happens when the good times return? As much as marketers would wish it, I fear it is unlikely that those consumers who gorged themselves on price-led value offers will be persuaded to pay full price by the promise of a strong brand story.
Source: SMH
Restaurants, grocers reap solid growth in May...
The latest data from the ABS has shown restaurants, take-away outlets and cafés record seasonally adjusted growth of 1.4 per cent in May, outstripping the rise in sales of 1 per cent seen in the food retail sector (which includes specialty food retailers, grocers and supermarkets) and the retail sector at large.
Restaurants
The result overturns a 0.5 per cent decline in seasonally adjusted sales for restaurants, cafés and take-away outlets and suggests consumers were inclined to spend some of their stimulus payments on eating out. Restaurant and café owners have been among the hardest hit by the economic downturn in Australia while many fast-food businesses have been able to capitalise on what has been dubbed as a ‘trading down’. However, there have been signs that restaurants have seen the worse pass by - an assertion supported by today’s retail data.
Before the crisis reached Australia there were suggestions that the restaurant sector was better equipped to cope with a recession that in 1990/91 due to eating out becoming less of a discretionary option to the average Australian consumer and more of a lifestyle choice. Past research into the impact of recessions on restaurants also offered some hope as the number of restaurant visitors has often been seen to rise - albeit more moderately. And, as it has turned out, many restaurants have noted that consumer levels have not fallen away drastically but the spend per customer has been a drag on sales figures.
Take-away outlets
Fast-food has been a resilient sector, lead by some of the industry heavyweights who have consistently posted strong results. The low cost, high convenience mantra pushed by fast-food retailers struck a chord with consumers intent on keeping costs low while still craving the convenience of a quick meal. The consumer desire for comfort food has also ensured insulation from the economic turbulence for the take-away sector.
Food retail
Food retailing, led by the supermarkets, has remained robust throughout the past year solidifying its position as a defensive, recession-resistant area. The 1 per cent rise in the seasonally adjusted figure more than countered a 0.2 per cent decline in April - before adjusting for inflation. Almost all of Australia’s supermarket chains have reported higher sales this year, including Coles, Woolworths, IGA, Franklins, Aldi and FoodWorks.
Industry response
The Executive Director of the Australian Retailers Association, Richard Evans, believes the one per cent lift in overall retail sales is a good sign for the economy. “Looking back over the past months, there has been solid retail trade growth in each month, with the exception of February which is traditionally the toughest month for retailers,” Mr Evans noted. “The May retail trade reflects the rise in consumer confidence and other positive indicators including the Government’s economic stimuli and the RBA’s interest rate cuts from late last year flowing through.” “A new type of consumer is beginning to re-enter the market - this is a consumer who is cashed-up and ready to spend without guilt after months of apprehension about letting go of discretionary spend.”
Source: www.ausfoodnews.com.au
ACCC clears Kirin purchase of Lion Nathan...
The Australian Competition and Consumer Commission has given the green light to Kirin’s purchase of brewer Lion Nathan.
The Australian competition watchdog was the final regulatory hurdle that needed to be cleared by the Japanese firm after receiving approval from the Foreign Investment Review Board (FIRB) on June 19. The decision by the ACCC - announced Friday afternoon - came five days earlier than expected.The $3.5 billion takeover still requires the approval of Lion shareholders, however, with the deal likely to be sealed in October.
“Lion Nathan currently anticipates that it will lodge the scheme booklet with ASIC (the Australian Securities and Investments Commission) in July/August and that the scheme meeting will be held in September/October 2009,” Australia’s second largest brewer advised.
Source: www.ausfoodnews.com.au
Rudd Government in spotlight over Grocery Choice backflip...
Prime Minister Kevin Rudd has disputed claims that he has failed in a bid to increase competition in the grocery sector. The banishing of the controversial Grocery Choice website on Friday without consultation with its developer - consumer group Choice - has put the government in the spotlight for breaking an election promise. There have also been reports that Choice will sue the Federal Government - which appears unlikely - and calls for a Senate Inquiry by Independent Senator Nick Xenophon and the Greens.
Mr Rudd told reporters today that a number of other measures had been introduced in his time as Prime Minister that would offer a benefit to Australian consumers, such as new predatory pricing powers to the ACCC and the imminent introduction of compulsory unit pricing. “The Government has been very active on the whole question (of supermarket competition),” he argued. However, skeptics have reason to be cynical on such a claim. After all, it could be argued that unit pricing can be advantageous to supermarket chains like Coles and Woolworths as it highlights the lower cost of their private label goods - presenting them with an opportunity to further push their higher margin goods. The major retailers actually made steps toward introducing unit pricing before the Federal Government had even lifted a finger on the issue. And, as for the predatory pricing legislation, the ACCC has yet to launch a single prosecution. The Rudd Government could claim that it has scared companies off the practice but how could anyone tell?
There remains the prospect of creeping acquisitions legislation and new planning laws but nothing has been concluded on those matters. Mr Rudd added that the government was continuing discussions with retailers regarding the creation of an industry-run grocery price website. “I’m confident the minister will work a proposal through with the industry over time,” he said. “It will just take time.” Choice was particularly critical of the decision on Friday, implying that the power of the major supermarkets had driven the decision. The consumer group is currently mulling over the options available to it, including pushing ahead with the introduction of the site.
Meanwhile, a Senate Inquiry appears to have the support of the minor parties and the Opposition. Greens Leader Bob Brown is planning to ensure executives from Coles and Woolworths are required to give evidence as the likely inquiry looks into a backdown on an election promise, the possible influence of the major supermarket chains and the timing of the announcement (it was made just five days before the site was due to go live, just as Parliament entered a Winter recess and on a day when it was always going to be overshadowed by the death of Michael Jackson).
It is rumoured that around $7 million has been spent on the website by Choice since they took control from the ACCC. Grocery Choice may be dead but we certainly haven’t heard the end of it.
Source: www.ausfoodnews.com.au
Unit pricing comes into effect today...
The Federal Government’s unit pricing* Code of Conduct becomes operable today, with retailers given until 1 December 2009 to display unit pricing on food based grocery items.
The Australian National Retailers Association, which represents Coles, Woolworths and Franklins, said today that many supermarkets had already made the move ahead of schedule.
“Thousands of every day grocery items across the country’s largest supermarkets already display unit prices,” ANRA CEO Margy Osmond advised. “Franklins has completely rolled out unit pricing across its 82 stores. Both Coles and Woolworths already display unit prices on thousands of everyday grocery items.”
The code applies to supermarkets over 1,000 square metres in size, however smaller retailers can ‘opt-in’. The code will also cover advertising and online food sales. “We are pleased the Federal Government consulted widely and produced a practical national code,” Mrs Osmond added. “While price is an important consideration for consumers, other factors like convenience, trading hours, and food quality also are important factors that influence shopping decisions.”
WHO THE UNIT PRICING CODE WILL APPLY TO: The draft code applies to online retailers, and store-based retailers with a floor space of more than 1000 square metres devoted to the display of grocery items, provided those retailers sell a minimum range of food-based grocery items. The minimum range is at least seven of the following grocery categories:
* bread;
* breakfast cereal;
* butter;
* eggs;
* flour;
* fresh fruit and vegetables;
* fresh milk;
* meat;
* rice;
* sugar; and
* other packaged foods.
The code will apply to retailers who voluntarily display a unit price (with a transition period of six months), provided those retailers also supply the minimum range of food-based grocery items. A store which voluntarily displays a unit price for some of its products, but does not supply the minimum range of food-based grocery items (for example, a department store unit pricing its chocolates, or a liquor store unit pricing its beer) would not be required to comply with the code. The ACCC will be in charge of enforcing the code and today released two guides to assist retailers in complying with the new legislation.
* Unit pricing is where grocery items are priced by reference to common units of measure such as per 100 grams and per 100 millilitres (both the unit price and total price will be displayed). Some products will be measured differently such as herbs and spices due to their small size and fresh produce like fish, vegetables and meat will continue to be sold on a per kilo basis.
Source: www.ausfoodnews.com.au
Consumers are spending more money online...
Coremetrics’ most recent e-commerce benchmark report shows a 60 per cent increase in the average order value for ANZ purchases made during March, April and May 2009.
Australian and New Zealand shoppers are returning to the world wide web in droves to peruse global e-commerce websites and make online purchases, according to Coremetrics, which surveyed the buying habits of more than 75 million shoppers worldwide. Since the global economic downturn, consumers have been naturally careful about their spending habits but it seems that online opportunities are proving too good to pass.
Twelve months ago a similar benchmarking study showed that the average Australian and New Zealand shopper was spending $54 and $48 respectively on average per order. Following this the global economy took a nose dive, as did online consumer purchasing habits with a January 2009 benchmark report showing Australian and New Zealand shoppers spending an average of $37 and $38 per order respectively. Today, online consumers in Australia are spending an average of $90 per order, while New Zealand shoppers have jumped to $96.
“Such a significant jump in the average order value over the last 12 months is very promising,” said Kevin Mackin, general manager for Coremetrics ANZ.
“While it’s not all that surprising to see an increase in spending since January, thanks to the general positive shift in consumer confidence, the fact that we’ve surpassed spending numbers for more than 12 months ago is interesting
“These figures represent a smarter modern shopper; one that takes time to visit e-commerce sites all over the world before deciding on a purchase. ANZ consumers are becoming more e-commerce savvy; they’re enjoying perusing the breadth of products and services available over the internet and take advantage of online discounts and special offers unavailable in-store,” said Mackin.
Local businesses looking to take advantage of burgeoning consumer confidence in e-commerce need to keep in mind that while shoppers are spending more money per purchase, they’re buying less frequently. The average number of orders per 100 sessions has dropped to 1.55 for Australian and 1.26 for New Zealand shoppers. In January 2009 this figure was 2.9 and 2.5 for Australian and New Zealand consumers respectively.
“The global trend has been screaming at us for years that online shopping is on the up and up. Despite hiccups (small or large) in the economy, more and more people are and will shop online to scour for bargains, find specific products and save themselves the time of shopping in-store.
“While ANZ lags the global average order value by more than 50 per cent, all things point to a steady increase. We expect to see the average order value for Australia and New Zealand double in the next 12 to 18 months, which sets the target very high for e-commerce businesses throughout the region,” said Mackin.
“Companies out there looking for new customers online can no longer afford to have websites that are outdated or impractical. They need to be offering cross- and up-sell opportunities to existing customers, and compelling product and service offers to prospects. They need to know who their customers are, how they interact with the business and what their buying habits are.
“The smart companies taking a leap in their online marketing strategies are the ones that are snaring a significant share of the e-commerce market right now and they’ll continue to do so as opportunity increases,” concluded Mackin.
Source: www.retailbiz.com.au
Shoppers Respond Differently to Store Media...
The way consumers respond to in-store promotional messages and media is changing, with traditional appeals losing some potency, according to the results of a new poll that surveyed 999 shoppers shortly after completing a shopping trip.
The effectiveness of promotional messages depends on the age and gender of the shopper, the message vehicle and whether or not the message is found inside the store or outside the store, the survey revealed.
"Convenience retail has a huge opportunity, because most c-store purchases are spontaneous, optional, sometimes planned and sometimes unplanned," said Curt Johnson, svp, consumer industries for Miller Zell, the firm that conducted the study. "New promotional technologies will help boost the ring. But how can convenience retailers best market to the young adult male coming in for an afternoon snack now? How do they convince him to purchase just one more item?"
In the survey, more shoppers (32 percent) rated in-store signage as "very effective" than they did out-of-store advertising, including television ads, billboards and other media (27 percent). Compared to older shoppers, though, Generation Y consumers (born between 1982 and 2003) were more likely to regard both indoor and outdoor advertising as "very effective."
While the recession has two-thirds of consumers making shopping lists before they go to the store, Miller Zell found shoppers are making brand decisions 60 percent of the time after entering the store. More shoppers (70 percent) say they are engaged by end-of-aisle signage than by merchandising displays (62 percent), department signage (58 percent), shelf strips (55 percent) or shelf blades (50 percent).
How well different types of messages -- product information, price discounts, etc. -- are received depends on the age and gender of the customer. While nearly half of the consumers said they want product-comparison information, Generation X (born between 1961 and 1981) and Gen Y place more importance on that in-store trigger. Product quality information is more important to men than women -- and more important to middle-income earners -- than folks in other income brackets.
No surprise, price tops the list of important factors when making a purchase decision: 70 percent of the consumers said price reduction influenced a planned purchase; 47 percent said they were influenced by an everyday-low-price message.
"People aren't noticing everyday low pricing messages as much in today's shopping environment," Johnson said. "But we are cautioning our retail clients to be careful of the precedent they set. If their shoppers are trained to expect those discounts, there will be dissatisfaction on the back end when the economy gets better, and the cents-off or dollars-off or percentage-off deals go away."
Source: www.brandweek.com
Australian
News:
Aldi retains paid maternity leave...
ALDI will retain its paid maternity leave scheme on top of the government's planned paid parental scheme, which is set to roll out in 2011.
ALDI managing director, Michael Kloeters, said the government-funded maternity leave for those earning less than $150,000 a year would be a great boost for new parents. Employees at the privately-run discount German supermarket chain currently receive 14 weeks' pay at 50 per cent while on maternity leave. It was the first grocery retailer to introduce a paid maternity leave scheme in April 2008.
Source: Business Spectator...
THE GOOD GUYS a takeover target for WOOLWORTHS?...
Australia-based The Good Guys has claimed that Woolworths is reviewing the potential acquisition of the electronics retailer after being rejected by JB Hi Fi. Both companies have refused to comment. The Good Guys gave an exclusive interview to the Financial Review in a move that has been seen by as a precursor to trying to increase the value of the company by talking for the first time about the growth it has witnessed during the past few years. It was revealed that The Good Guys is also reviewing the potential acquisition of troubled retail group Clive Peeters who recently called in KPMG to conduct an audit of the company, with a view to either selling up or attracting additional investors.
Source: Planet Retail
Plonk in plastic?...
Screwing the plastic lid off a plastic bottle of wine seems very - synthetic. Where is the romance, the sophistication? It was bad enough losing the satisfying pop of the cork, but news that two Australian winemakers are now bottling some drops in plastic is enough to send any connoisseur reaching for the nearest fortifying red.
Wolf Blass and Sirromet Wines claim plastic bottles are convenient and more environmentally friendly, as they produce almost 30 per cent fewer greenhouse gas emissions than glass bottles and are cheaper and safer to recycle. But what about the quality of the plonk? A study commissioned by plastic bottle manufacturer Portavin found that wine stored in plastic bottles, which are permeable to air, starts to deteriorate after about eight months and has a shelf life after bottling of just 12 months.
Meanwhile, shiraz has pipped chardonnay as Australia's top drop, according to the Winemaker's Federation of Australia. It accounted for 23.6 per cent of the total 2009 vintage crush, compared with chardonnay's 23.4 per cent.
Source: SMH
Brand Australia Council a marketing flop: Kennett...
Former Victorian premier Jeff Kennett has taken a shot at the latest attempt by Australia to sell itself abroad. He said the idea of a committee of businessmen advising government on how Australia Inc markets itself abroad is doomed to fail. "We have more bodies than we know what to do with. We have so many in the tourism industry, all of which I am sure are doing good work but in terms of having established a public or political priority, they have all dismally failed,'' he said.
Prominent businessmen such as Sir Rod Eddington, Geoff Dixon and James Strong are backing the establishment of a Brand Australia Council. They plan to present their ideas to the Prime Minister later this year. But Mr Kennett said that the failure of Australia - and in particular its tourism chiefs - to consistently market the country as a tourist destination gave him little hope that the idea will succeed.
"Tourism would have been given much greater recognition by governments of all political persuasions if they had [succeeded] ... there's no point in having Australia Inc if you can't have a consistent approach of applying it ... We come up with a brand and say everyone has to use it - what then?'' he asked. He said Tourism Australia's recent campaigns, namely "Where the Bloody Hell Are You" and the tie-up with the Baz Luhrmann film Australia were inconsistent and "a waste of money''. Business leaders - many of them from marketing backgrounds - envisage the council coordinating how the country's major industries - from mining and education to tourism and food and wine - project themselves abroad.
For too long it has fallen to the tourism industry to carry the burden of promoting the country, they argue, and that if Australia is to succeed on a global level it must have a consistent approach. The council's driving force, Christopher Brown, the CEO of Tourism & Transport Forum, said he hoped that the council would address that inconsistency in branding."I would like to think that he can be proved wrong. We are getting support for the idea and I've had quite a few people come out of the woodwork to lend their support.''
Source: SMH
Hard-earned thirst for change...
FOSTER'S may launch a low-carbohydrate version of Victoria Bitter to revive the fortunes of the country's best-selling beer. Demand for beer with lower carbs has grown exponentially as Australian men become more health conscious. Sales have risen from nothing to $468 million in less than five years and brewers are greedily eyeing the example of the United States, where light beers, as they are called, account for one in every two beers drunk.
Late last year Lion Nathan launched a low-carb version of its best-selling mainstream beer, Tooheys New White Stag, to take market share from the low-carb market leader, Pure Blonde, which has nearly 60 per cent of the market. Lion believes there is resistance among core male drinkers to switching from mainstream beer - a product invariably marketed around masculinity - to a lower-carb product like Pure Blonde, which they might regard as less than masculine.
Foster's wants VB to claim a greater share of the mainstream beer market, in which it competes with Tooheys New, West End Bitter and VB's stablemate, Carlton Draught. But it also wants to increase the "value" of the VB trademark, which it admits is difficult when Coles and Woolworths discount the beer to increase traffic to stores. This makes it harder for independent stores - with two-thirds of VB sales - to compete. "There is clearly an innovation agenda to the VB brand and all I am prepared to say is 'Watch this space'," the head of beer at Foster's, Peter Sinclair, told the Herald.
When asked if a low-carb VB was on the cards, he said: "Your words, not mine."
Mr Sinclair said that two years ago Foster's decided to push the VB trademark and launched a mid-strength version, VB Gold, but it was widely regarded as a failure because it had captured just 0.8 per cent of beer sales. After years of free fall, VB sales flattened over the past year at 43 per cent of the traditional beer market, leading Mr Sinclair to declare "the turnaround" for the $1 billion brand had begun.
A new marketing campaign that will begin in August will depart from the brand's 40-year-old "hard-earned thirst" line, and attempt to banish the unwanted stereotype of the blue-singlet wearing, hard-drinking bogan as the core VB drinker. In a new commercial for the beer sprinkling of celebrities - among them the cricketer Michael Clarke and the music journalist Molly Meldrum - join a cast of Australians marching under banners that read "Men that punch above their weight", "Men with good-looking wives" and "Sheilas named Sheila", with women actually named Sheila.
Source: SMH
They know where you live, where you shop and what is inside your fridge...
Who would have thought that feta cheese could teach Tesco a valuable lesson in shopkeeping? But that is exactly what happened to the British retailer a few years back when it was getting to grips with the rivers of data flowing from its tills and onto the millions of its loyalty cards in circulation.
Feta wasn't doing much for its business; sales were low, as were the margins, and it was destined to be deleted. But by looking at the data from its Clubcard the company saw that feta was bought by its most valuable customers and they wouldn't come to the store if it wasn't on the shelves. Now the company makes a point of stocking it in stores that are used by its highest-spending customers. Woolworths is hoping to learn similar lessons from its Everyday Rewards loyalty scheme.
But most of the talk around loyalty schemes has been about the traffic from the retailer to the customer - that is the offers it sends out. This week Woolworths signed up with Qantas to "reward" its card-carrying shoppers with frequent flyer points. Based on their spending behaviour Woolworths already sends about a million emails to its cardholders each week, offering them deals such as 12c off a litre of fuel for those who spend $55 or more on meat. But the real action is on the shop floor. Woolies and data experts such as DunnHumby, the company that manages Tesco Clubcard, say the real value is the information that comes back to the retailer and, more importantly, what it does with it. Woolworths is using modern technology to turn back the clock. It believes that equipped with information gleaned from its Rewards card, each store can be more reactive to local customers.
Up until it got into the loyalty game - and it has only been 15 months - Woolies didn't know how many times people shopped with it. It only knew how many transactions went through its tills. As its data pool deepens and it begins to segment customers by their purchasing habits a clearer picture of what its customers are not buying - rather than what they bought - will begin to emerge. With other data such as Roy Morgan it knows how much custom is out there and how much it is missing out on. It will know if a certain segment of shoppers is buying BBQ sauce but is not buying meat for the barbie, and then do something about it. Information from the card is already being used to plot where people are shopping and where they are filling up on petrol to see if they need to open up another petrol station or even store nearby.
Armed with this knowledge it believes it can "get to know" its customers every bit as well as the days when local stores did actually know their customers, if not by name then by what they bought. Getting people to switch from Huggies to Snugglers is not the main game, as the man behind Woolies' card, its general manager for customer engagement, Richard Umbers, says: "It's an add-on extra but it is not the be and end all of the program. It is more about us getting an insight into the consumer, which then allows us to run a better business." Analysts estimate Woolworths needs to see a sales increase of about 2 per cent to cover its costs. If it cannot achieve this then Everyday Rewards may join many other failed loyalty card schemes and go down in history as an expensive piece of plastic
Source: SMH
Re-usable coffee cups in standard barista sizes...
Our coverage of ad-supported FreePaperCups earlier this year sparked quite a reaction from eco-minded readers, many of whom very rightly pointed out the wastefulness inherent in using disposable cups. We're happy, then, to present the KeepCup, a sustainable, reusable alternative designed to reduce the massive waste created when coffee cups are meant to be thrown away.
The average paper cup consumes 2.5 times its final weight in raw wood, and is also coated in a polyethylene lining that makes it not just waterproof but also unrecyclable. Similar in intent to I Am Not a Paper Cup, the KeepCup is a lightweight, reusable and recyclable cup crafted from polypropylene—otherwise known as No. 5 food-grade plastic. Two sizes are currently available—a small, 8oz. size and a medium, 12oz. version—with both a large, 16oz. size and a "Babycino" 4oz. size on the way. Particularly notable is that Australian KeepCup replicates standard sizing on disposable coffee cups commonly used by baristas, so it can be substituted for paper cups without any modification; the small and medium cups fit directly under the nozzle at the coffee machine. Cups, lids, plugs and silicone bands can also be mixed and matched to create colourful combinations, and the cups are dishwasher-safe on the top rack, with an estimated lifespan of four years. Melbourne-based KeepCup is targeting cafes and employers with the product; corporate branding is available. Introductory pricing on the KeepCup begins at AUD 7.80 for the small version, increasing to AUD 9.80 in July.
KeepCup is currently seeking "crusaders" to manage and distribute its cups in overseas markets. Given that Australians alone use some 500 million disposable cups each year—throwing out 951 every minute—there's sure to be considerable opportunity in virtually every neck of the woods. One to get in on early! ;-)
Source: www.keepcup.com.au
FoodWorks acquires 45 Coles supermarkets in $35m deal...
Independent Australian food and grocery group FoodWorks has agreed to purchase 45 supermarkets and eight associated Liquorland outlets from Coles. The transfer, announced this morning by Wesfarmers - the owner of Coles, is “part of Coles’ broader plan to improve its overall network of over 700 supermarkets and over 600 Liquorland stores and is an important step in the Coles turnaround”, according to the retailer.
Coles Managing Director Ian McLeod said the store transfer would allow both firms to reap benefits. “We think this is a great outcome for team members and customers of both Coles and FoodWorks,” Mr McLeod said. “FoodWorks view these Coles supermarkets as valuable additions to their existing portfolio of over 700 member stores.” “I’m very pleased to advise that all store team members will be offered roles with FoodWorks and that they will retain all their existing employment entitlements.” The cost of the acquisition is approximately $35 million, and includes payment for stock, cash and the transfer of employee entitlements. “We’ll continue to focus on landing the right store formats in the right locations across Australia for our customers,” Mr McLeod added. “The renewal store program will see our supermarket store network continue to grow.” Mr McLeod said the store renewal plan will see Coles over a net increase in jobs over the next twelve months.
The purchase of stores with annual revenue of around $450 million was seen as a great chance to “help accelerate FoodWorks’ growth strategy”, according to Chief Executive Peter Noble. “It’s also very good for the independent sector, because while Coles has relinquished these stores, the independent industry gets them unencumbered,” he said. The transaction, which remains subject to ACCC approval and the approval of FoodWorks’ shareholders, will see stores handed over to FoodWorks progressively over a nine month period.
Source: www.ausfoodnews.com.au
Customer satisfaction with supermarkets on the wane?...
Customer satisfaction with all four major supermarkets (IGA, Coles, Woolworths and Aldi) fell in April, although the gaps between the four have closed over the last six months, according to the latest Roy Morgan Supermarket Satisfaction Report.Among Aldi customers, 89% were very or fairly satisfied with the supermarket, followed by IGA customers (86.2%), Woolworth (85%) and Coles (84.6%). All four are now below their rating from five years ago when Aldi had 93.7% approval followed by Woolworths (89.6%) and IGA and Coles (88.7%).
“Aldi customers have been consistently more satisfied than customers of Coles, Woolworths and IGA, and, despite a recent decline in the overall satisfaction of their customers, Aldi still holds the lead,” Norman Morris, Industry Communications Director, Roy Morgan Research, said. “Similar losses in satisfaction were seen for both Coles and Woolworths, but to a lesser degree and on the back of strong gains.”
“Until March ‘09, Coles’ customers showed steadily increasing levels of satisfaction, but faltered in April ‘09 when customer satisfaction declined slightly. Woolworths recently experienced a similar recovery in satisfaction to March ‘09 and a drop off in satisfaction for April ‘09. The current overall satisfaction score of 85% for Woolworths in the 6 months to April ‘09 still means they are leveraging at 0.4% above that of Coles.”
Source: www.ausfoodnews.com.au
Roxy surf's up...
In the northern hemisphere, summer is almost here. If you’re a Roxy Girl, that means lots of lazy, hazy days on the beach are just around the bend. If you’re a Roxy Girl, it also means you possess the attributes that define the US$ 400 million lifestyle brand: daring, confidence, natural beauty and fun. You’re also likely Web-savvy—a necessity for a brand that uses its online presence to hawk sports apparel and other accessories to enhance your active, Roxy-inspired lifestyle. The product lines reflect the Roxy spirit, incorporating surf, sand and snow into all of its SKUs.
Roxy, owned by surf wear and board sport gear manufacturer Quiksilver, has already boosted its brand recognition offline with a strong retail presence. After opening its first location in Hawaii in 1997, the chain now boasts more than 600 stores globally. Its brick-and-mortar M.O. has paid off: 89 percent of all girls between the ages of 13 and 19 nationally know the Roxy brand (and it’s the top California-style surf brand among the same demographic). Even though Quiksilver was already an established, authentic surf company, women surfers and snowboarders just didn’t get as much press as their XY-chromosome counterparts. So it was important right from the get-go for Quiksilver to establish the Roxy brand’s estrogen-driven identity when it kicked off the women’s swimwear/sportswear line in 1990.
Toward that end (and maybe with a little divine intervention from Kahuna himself), the Roxy crest was derived from the Quiksilver wave-on-a-mountain logo. The Roxy version is simply two mirror images of the Quiksilver logo placed together to form a heart, adding a feminine touch to the already recognizable Quiksilver symbol. This logo appears prominently on the Roxy homepage, perched atop the continually rotating opening image. One week it sits confidently on a wave’s crest, as a wetsuit-clad warrior takes on the Big One; another week, it may oversee surfer Sally Fitzgibbons riding a camel, surfboard under her arm. Superimposed on top of the salty spray and desert sands are the ROXY letters, exuding daring and confidence through their all-caps typography. Aesthetically pleasing aquas and greens are splashed throughout the site, evocative of a sun-soaked day riding the waves.
Roxy has expanded its product line since its inception, and these brand extensions are all represented on the site: Eyewear, a snow line, footwear, watches, jewelry, handbags and backpacks populate the site in abundance. There is also Teenie Wahine (Roxy’s children’s line) and Roxy Room products (a line of bedding, lamps and posters) for the taking. The casting director for the site was obviously briefed on Roxy’s overall branding strategy. Don’t expect to find bikini-clad vamps along the lines of a Victoria’s Secret catalog or the Sports Illustrated swimsuit issue: The featured models are fresh-faced and confident and don’t strike overly sensual poses that exhibit the “come hither” lip purse that usually accompanies a girls-in-bathing-suits pictorial. After all, according to Roxy’s own brand directive, “natural beauty goes beyond sexiness—a Roxy girl doesn’t need to try to look sexy.”
Roxy is the largest corporate sponsor of women’s surfing worldwide, and so Roxy-branded extreme events are an integral part of the offline brand’s identity. These events are incorporated prominently into the site. Looking for adventure? Check out the links to Roxy surf camps and sports competitions. This month in the spotlight: Roxy Jam Biarritz, a cultural and musical festival held in July on the Basque Coast. Cruising for a creative outlet? Dress up a tankini or bring your own flavor to board shorts in the Design-a-Roxy-Bikini contest or head over to Roxy’s dedicated music area, which is regularly updated with new songs and artists deemed “Roxy material.” It goes without saying that a Roxy girl is in the know and Internet-intelligent. The site’s news section and blog keep the good times (and information) coming. Roxy’s online presence is bolstered by links to its personalized Facebook, MySpace and YouTube pages, and girls can sign up for a free subscription to Roxy’s ongoing podcasts, which showcase the brand’s snow and surf team riders ripping it up around the world.
Quiksilver is surely stoked about how well its female-focused offshoot has done. The economy may be tanking right now, but Roxy’s strong offline identity, complemented by its energetic online presence, will ensure it keeps cleaning up while its daring demographic tries not to wipe out.
Source: www.brandchannel.com
Global
News:
Is chocolate recession proof?...
Eating chocolate has a ‘feel good factor’ and is considered an affordable luxury in some countries. However, during the financial downturn, luxury chocolate shops in airports and duty-free gift purchases are likely to suffer a significant drop in chocolate sales. Rabobank sees a sales dip in premium brand chocolates as one of many risks to producers in the new report ‘Is Chocolate Recession Proof?‘
From the late 1990s until early 2008, the ‘premiumisation’ trend took off with consumers trading up to more ‘luxury’ food products. Chocolate companies developed new strategies to supply the chocolate loving community with indulgences in higher priced products and premium brands.
Trading down
Unfortunately for those cashing in on the trading up trend, historic evidence suggests that chocolate is not completely immune to recession. As a result, a reverse trend of consumers trading down in the chocolate market is expected, according to report author and Rabobank chocolate analyst Maria Castroviejo. In 2009, Rabobank expects the global chocolate volume to decline moderately, and to shrink more so than in previous financial crises. “Given the trading up that took place over the last few years, there is greater room for trading down in value during this economic crisis than during previous ones,” Ms Castroviejo explained.
Benefitting from the current market conditions
Not all the chocolate manufacturers are likely to suffer, however. “Some companies may clearly benefit from the current environment as the market consolidates at the expense of the less differentiated players, and those who already had a weaker financial position before the downturn started,” Ms Castroviejo advised. For some chocolate makers, the new market conditions may represent an extra chance for growth which was not present before the financial crisis. Private labels or supermarket brands are gaining share in many fast-moving consumer goods categories and certain chocolate segments, such as tablets or seasonal chocolates.
“Some companies who were criticised for not having luxury products in their portfolios, are now doing better during the financial crisis because they have lower priced options for the current market trend on trading down,” the analyst added. “Leading brands and strong private label suppliers are likely to come out of the current downturn in a stronger position than before.”
Global chocolate market
In 2008, 7.4 million tonnes of chocolate were consumed globally, with Rabobank estimating that global chocolate consumption had a retail value of around EUR 73 billion (A$127b).
Source: www.ausfoodnews.com.au
Poor Economy Heightens Brand Equity...
When the economic winds are howling and the weather gets ugly, consumers tighten their grip on brands they are loyal to; they don't run to the label with the lowest price. Brand equity does not lose potency when money is tight. So says Harris Interactive in its latest EquiTrend study.
Comfort foods and staples won the highest brand equity scores in the survey-based study that gauges consumer sentiment. The study measures 1,000 brands across 39 categories on parameters like brand familiarity, quality and purchase consideration. The study also includes a new measure on the value consumers feel they receive from a brand for the money they pay, a reflection of the economy.
The top brands were M&M's plain chocolate candy; Hershey's Kisses; Arm & Hammer Baking Soda, Reese's Peanut Butter Cups; Hershey's Milk Chocolate Candy Bars; Kleenex; Campbell's Soups; Google, M&M's Peanut Chocolate Candy; and Crayola Crayons.
The study -- which surveyed 24,446 U.S. consumers ages 15 and over in March and April this year -- asked respondents to rate 60 randomly selected brands, with 1,202 brands involved. Thus, each brand received approximately 1,000 ratings. A brand's overall score is elaborated from scores on familiarity, quality and purchase consideration, and relevance from all respondents' responses, even from consumers who are not familiar with the brand in question.
At the bottom of the list, not terribly surprisingly, were brands tainted by the perception of moral turpitude around health and fiscal malfeasance. The firm says tobacco and financial service brands, particularly AIG, joined the ranks of these weaker brands on the bottom.
The top brands in various market segments are a panoply of premium, niche and mass-market brands, including Honda for automobiles; Subway for fast foods; KitchenAid for appliances; Coca-Cola for beverages; Microsoft for software; Sony for consumer electronics; Southwest for airlines; and Grey Goose for spirits.
Wes Brown, analyst with Iceology in Los Angeles, says the variability of brand loyalty in a down economy depends on the product category. "Logically, a large part of the population in times like this would be willing to forgo loyalty and ultimately get the cheapest thing out there," he says. "But it will be category-specific. What's a bag of M&M's cost? If that's your one indulgence, how much will that cost you?"
Brown also points out that loyalty that is driven by value isn't about price. "People stick with what they know -- so if my money is important, do I buy something I haven't used and am not too sure about and that might be cheaper, but perhaps not as good? Maybe I'm saving four or five or ten bucks, but rather than sticking with what I know, that works, I'm taking a chance." Likewise, he says, the value of indulgence products like confection is not merely about price. "It's something you choose to reward yourself with, so you are going to buy what you like because, 'Screw it, everything else in my life may suck so why get rid of the one thing I like?'"
Source: www.mediapost.com
TESCO till breakdown costs GBP2-5 million...
UK-based Tesco’s recent widespread till breakdown is estimated to have cost the retailer between GBP2-5 million (USD2.83-7.09 million), according to a report in The Grocer. Industry sources suggest the glitch was down to the relaunch of the company’s loyalty scheme. Only stores with a particular IT configuration were reportedly affected by the glitch. Meanwhile, Asda claimed it experienced a 10% uplift in customer numbers in stores close to Tesco outlets which were affected by the technical problems.
Source: Planet Retail
BOOKER launches Euro Shopper range...
UK retailer Booker has launched its first Euro Shopper chilled range, according to a report in The Grocer. The range consists of five items all priced at GBP1 (USD1.42), including two cheeses, bacon, honey roast ham and turkey. According to Director of Retail, Steve Fox, the range will offer retailers a 30% mark-up. “These new Euro Shopper lines are ideal to help independent retailers sell more, as they are fantastic quality, at an entry level price,” he said. “Euro Shopper increased sales through repeat purchases and drives footfall into independent stores,” he added. The additions bring the Euro Shopper range to 50 SKUs. The move follows a surge in sales in the range, taking GBP1 million (USD1.42 million) a week with 29,000 customers.
Source: Planet Retail
SAINSBURY'S doubles share of UK DVD market..
UK retailer Sainsbury’s has doubled its share of the UK DVD market over the past few months, following the appointment of key executives from EUK, according to a report in The Grocer. The appointment has seen the retailer restructure its entertainment business into four key categories, DVDs, games, books and music. Ex-EUK executive Matt Newman heads up DVD, while Matt Rouke heads up music. “We believe we now have one of the best buying teams in the sector and fully intend to make use of that asset to be more responsive to our customers’ needs,” said Entertainment Buying Manager, Richard Crampton. “Bringing the buying and supply chain in-house allows us to work in much closer partnership with our supply base.” Meanwhile, in April Tesco expanded its entertainment team with two former EUK managers, John Stanhope and Mark Burgess.
Source: Planet Retail
TESCO to trial virtual wine advisor...
Tesco is set to trial a virtual wine advisor, which will offer customers advice when they choose their wine instore, according to reports in the UK press. The service, which uses touchscreen technology, will allow customers to search for wine by country, colour, style and price. Further information can also be obtained by scanning the barcode on the bottle. The service is being trialled in the wine aisle of six stores, though if successful may be rolled out to up to 150 supermarkets later this year. Tesco says the service removes the uncertainty around choosing a particular wine, giving customers more confidence to try different products.
Source: Planet Retail
Pringles are chips, taxman decides...
Pringles' tax status has been crunched by a trio of British judges. The Court of Appeal judges decided on Wednesday that the snack is a potato chip - and that means it's liable for Britain's Value Added Tax. In Britain, most food isn't subject to the 15 per cent national tax, but potato chips are. A lower court had decided Pringles weren't chips and would remain exempt from tax. But the higher court judges disagreed. They said the snack contains "more than enough potato content" to be considered a chip. A spokeswoman for Pringles' manufacturer Procter & Gamble Co said the company has been paying the tax protectively and so does not owe the taxman.
Source: SMH
Pill popping is giving way to healthier diets, according to new research from the UK...
A new report from Mintel suggests the UK’s £396 million (A$825m) vitamins and supplements market is set to be a victim of its own nutrition agenda. Improved education on diet and nutrition has been a root cause of the struggles as the nation continues to eat more healthily and cuts back on its vitamins and minerals intake. The number of Brits popping supplements has been in steady decline since 2007, with the total number of users falling from 43% in 2006 to 41% in 2008. Meanwhile, the number of vitamin fanatics (those taking supplements once a day or more) has declined from 34% to 32% over the same 2 year period.
Vitamin devotees had previously flocked to the supplement aisles for all their nutritional needs, today, almost four in ten (38%) adults prefer to get their vitamins and minerals from their diets than from supplements. This compares to just one in four (25%) in 2005. “Growth in functional foods and the focus on healthy eating are having a negative impact on the vitamins and supplements market,” Alexandra Richmond, Mintel’s Senior Health & Beauty Analyst, noted. “As people eat more healthily, they do not feel that they need to take additional vitamins and minerals from supplements.” “The worsening economy has also hampered growth in the market with Brits looking at cheaper alternatives to get their nutrition. For many, vitamins and supplements are considered a non-essential spend.” Within the vitamins & supplements market, many people are moving away from single vitamins, preferring instead dietary supplements that complement their lifestyle needs. Dietary supplements have benefited from the focus on age-related concerns notably glucosamine for joint care and omega-3 for brain function, which is masking a decline in sales of other supplements.
Just over four in ten adults would not consider using vitamins and supplements in the future. While one in five adults perceive them to be unnecessary and one in seven claim not to notice any difference when using them. “A shift towards stripping chemicals such as fertilisers and e-numbers out of the diet may well also be putting pressure on the vitamins and supplements market owing to the unnatural tablet or capsule format of many supplements,” Ms Richmond said. “As a result the preference for natural sources of vitamins and minerals such as fruit, vegetables and dairy products is strong among many adults.”
Source: www.ausfoodnews.com.au
Profits gobbled up at Gordon Ramsay's restaurants...
Michelin-starred British chef and television personality Gordon Ramsay's restaurants in Britain have suffered a 90 per cent drop in profits as the recession began to bite, it has been revealed. Ramsay's latest company accounts show that the precarious situation forced the chef and his father-in-law and business partner Chris Hutcheson to pump STG5 million ($10.17 million) into the business.
The abrasive chef has blamed its problems on over-ambitious expansion and the closure of key London restaurants such as the Savoy Grill, which was shut because the luxury hotel is being refurbished. Pre-tax profits tumbled from STG3.05 million ($6.21 million) in 2007 to STG383,325 ($779,987.79). Ramsay's international expansion has also raised eyebrows. A spokeswoman for the group said the overseas restaurants would report their results later this month. He has an award-winning restaurant in Versailles near Paris and branches in County Wicklow in Ireland, in Tuscany, Sardinia, Dubai, Tokyo, Cape Town, New York, Florida and Los Angeles.
The company said that after a restructuring of the British operations, it was confident the group had "successfully undergone change for the better". Ramsay added: "The financial year ending 2008 was tough on our group and all involved, as well as the rest of the economy that faced a spiralling downturn. "We have regrouped and learnt some valuable lessons and the business has now returned to a position of strength."
Source: SMH |
