- Debranding: Why the world’s biggest companies are removing their brand names from their products, read the cover feature here
- “Nobody calls the Mini the BMW Mini even though it belongs to BMW. So why would we call ourselves RBS Coutts?” private banking firm Coutts talks about dropping the RBS branding
- Tony Cortizas, vice-president of marketing, premium portfolio and the Americas Meliá Hotels International, on the branding and debranding in the luxury market
Marketing Week (MW): Why does Tesco research whether the brand name should feature on products or not?
Sidonie Kingsmill (SK): When one of the [people managing the] categories wants to bring a product to market that doesn’t exist yet, they prefer not to put Tesco on it because customers won’t understand. We say we think we should put Tesco on it because it will help them understand it. To resolve the argument, we talk to customers.
MW: Are there any examples of product lines where you have considered whether or not to include the Tesco name?
SK: Recently, we talked about it in the world foods area. We are seeing massive growth in our ethnic foods section whether that be Polish or Asian or Halal, for example. We have been having discussions about whether the Tesco brand would work here, and we think it does.
You might think that people wouldn’t want to have Tesco on a Polish sausage but the reality is that it helps them believe it is a reliable, good quality product.
MW: You look after venture brands in your role, which mostly don’t have Tesco branding. What’s the thinking behind this?
SK: We are looking at what we can sell that is exclusive to us, to provide a reason for people to come to us rather than go elsewhere. We want to be innovative in some of those products as well, not just trying to do good versions of other types of products such as ketchup, cornflakes or nappies, which is what own-label is.
We thought we could use a combination of our strong customer knowledge combined with access to the best suppliers around the world, put a bit of marketing in, but nothing like the amount of marketing the big brands do [so we can offer them at] lower prices.
MW: Will Tesco continue to invest in venture brands in spite of poor Christmas sales and a management shake-up?
SK: Yes. Being a continued creator of highly valued brands, as [chief executive] Philip Clarke puts it, is a central plank in our global strategy. It is an element that we are experimenting with and will continue to invest in.
Some people look at this approach and think that Tesco is bringing brands in that are a danger to big established brands. But that is a complete misunderstanding of how a retailer runs its business. Every one of our brands has to pull its weight; it has to have the rate of sale and be worth stocking otherwise it will be taken out.
The venture brands are not things we are trying to take over the world with; we’re just trying to provide customers with solutions. If they work, they will stay, if not, they will go.
MW: How will you market the venture brands this year?
SK: We have very tailored plans for each brand. We’re looking at social media and online a lot more than last year and have picked categories that customers are particularly engaged in. Ice cream [with venture brand Chokablok], for example, is something everyone loves. And while people don’t always talk about feminine care [fulfilled by Halo], they are still very engaged in the category. We think because they are engaging areas, they are a perfect fit for social media.