At the end of last year, I expressed my concern about the strategy behind the brand-led supermarket ads, and was therefore intrigued to see their Christmas trading figures. While those who ran brand ads did okay, they did not significantly outperform their price-led competitors. In fact, it was the discounters Aldi and Lidl that wiped the floor with all of them.
I have been wrestling with this dilemma all week. My chief financial officer is constantly challenging me to demonstrate how many sales my latest marketing campaign has delivered, ignorant to the concept of the long-term benefits of a positive brand reputation.
As a marketer, I am therefore heartened to hear that while the big four supermarkets will inevitably continue to cut prices, they know only too well that they cannot beat the discounters at their own game, and instead see a renewed focus on customer experience as a way to win back market share.
Matt Davies, the former CEO at Halfords and Pets at Home, has been hired to lead Tesco as its new UK chief. He has a strong reputation for customer service, and his announcements so far suggest a clear focus on customers – making for a more pleasurable shopping experience, a happier workforce and a smarter approach to meeting a clear demand for lower prices. This is good news for marketers.
Shopping at Waitrose has always been one of the more pleasurable experiences in the weekly food shop. So it is good to see that the grocer is also prioritising customer experience, rolling out a new customer-led store format this year as it continues its expansion programme.
But what surprises me is how strong the customer experience is overseas. Supermarkets in the US and Canada are superlative, with fruits and vegetables individually polished and displayed outrageously. And it is rarely at the expense of price.
Take for example South Africa’s Food Lover’s Market – this is a supermarket that successfully combines everyday low prices with an approach that puts a beautiful and inspiring store environment, and helpful and engaging staff, at the heart of the customer experience.
Now to convince my CFO that a can of polish is a necessary marketing expense.