That strategy kicked off last night (20 November) in London, where Asda is an official partner and one of the lead sponsors of the Taste of London Winter event. Visitors to the event, which runs until 23 November, can find out more about Asda’s premium product range, Extra Special, as well as see live demonstrations from Asda chefs, butchers and its master of wines.
Speaking to Marketing Week at the event, Asda’s chief customer officer Stephen Smith admitted Asda had a tough time convincing the event organisers to let the retailer in because they didn’t think Asda had an image that matched the “upscale” nature of the event.
However, he said Asda was forced to arrange a meeting to explain their proposition, a test he didn’t think would apply to other retailers and a sign of the way the brand is still perceived in London and the south-east where it has a smaller footprint than in the North.
“They wouldn’t accept us at first – snooty – Asda – and the event is too upscale. So we had our product development folks meet with Jamie Oliver’s board and explain what we do for quality, sustainability and provenance and they were blown away and said we could come in.
“I’m not sure they would have put that test on other retailers, they did on us because that is not how we are known in London, it’s a little bit of the London exclusiveness. But we’re in and we’re really proud of our quality and our products,” he said.
Breaking through on quality
Smith said having done one of these events, Asda will now look to do more as it looks to “breakthrough” around quality and range. He admitted that while customers in the north of England understand the Asda proposition and the value and quality it offers, that perception is lagging in the south of England.
To change that, Asda is looking for new ways to get its products in front of consumers. He said that retailer might consider pop-up restaurants, although they are not on its agenda at the moment, and was also looking at ideas such as temporary click-and-collect sites.
“We have to find new and different ways to get our products out in front of people, especially when we’re looking in London in areas where we don’t such a big store base. We can do something like this [the Taste event], where people get to experience the products, and then deliver on a home grocery shopping or click-and-collect message so people realise they can access the food,” he added.
Asda is making its premium product a big focus of its Christmas marketing as it goes up against the discounters with a quality and price message. Joanna Johnson, Asda’s senior brand manager for Extra Special, said the range has now expanded to 695 products, up 21% compared to a year ago, and sales are rising faster than at the rest of Asda.
That expanded range includes products such as £5 lobster and £35 30-year-old whisky, with Asda claiming to offer “the best posh food at pocket-money prices”. Johnson said the range was particularly important in London and the south-east, where it is given more space in stores.
Having not advertised the Extra Special line-up for the past few Christmases, the range will be making a return to TV this year, with three spots focused around wine and prosecco, Christmas parties and Christmas dinner.
Smith believes Asda’s focus on price, value and quality is helping keeping it ahead of Tesco, Morrisons and Sainsbury’s. The supermarket posted a like-for-like sales decline of 1.6% in its most recent quarter but managed to maintain market share, a fact Smith called “astounding”.
“Desperation” among the big four
He said he sees “desperation” among the rest of the big four, with the supermarkets “fighting for their lives”. Despite the sales decline, he said he still feels “confident” in Asda’s long-term strategy, which “flies in the face of the gimmicky tactics used by rivals”.
“I see us on the winning side of the big four, the other three are out of line. They rent sales but they’re not long-term building and these guys are all masking the fact that they are way out of line on price.
“Winning is Asda being the best Asda, being crystal clear on price, having great prices, be honest and truthful with customers and you win. Don’t put all kinds of masking agents on with matching, promising, cards, you are disaggegating your relationship with your customers. Our pricing strategy is like the discounters and that wins. And all our range, George, general merchandise, Extra Special is a winning combination and different from the big four,” said Smith.