Tesco’s corporate woes torpedo brand perception
Tesco’s admission it had overstated its profits by £250m earlier this week has not only damaged its reputation in the City it also appears to have hit the retailer’s standing among consumers with brand tracking data showing its rating plummeting across several key measures.
According to YouGov’s BrandIndex, the supermarket’s Index score – an average of how consumers rate it in terms reputation, satisfaction, value, quality, whether they would recommend it and their general impression of the brand – has dropped by what YouGov classes as a “statistically significant” amount over the last seven days, to 9.3 from 14.8.
Its Buzz score – a net measure of the positive and negative things consumers have heard about the brand – dropped 8.4 points in the period, again a statistically significant amount and leaving it with a score that puts it bottom for Buzz in a list 27 supermarkets.
Tesco admitted to the accounting error Monday (22 September). The uncovering of the blunder has led to four of its executives being suspended, with multichannel director Robin Terrell stepping up to lead the UK business as interim managing director.
Its sales and profit have been falling as it comes under pressure from discounters Aldi and Lidl. Its poor performance was underlined yesterday when Kantar data showed its sales were down 4.5 per cent year on year in the 12 weeks to 14 September – worse than the 3.8 per cent in the previous quarter and making it the worst performing supermarket in the sector.
