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Spy stories usually begin either with a man in a mackintosh hiding behind a tree, poised to uncover infidelity, or in a tropical paradise, with a suave agent enjoying a strong drink by a pool surrounded by countless glamorous women. Never a title to stick with convention, however, RN’s undercover journey for this article began in the not-quite-tropical centre of Watford. Our mission: to gather intelligence on Britain’s supermarkets.
CONFUSION IS USED TO GET A SALE
As we arrive at the fruit and vegetable section in each supermarket, Mr Adcock goes straight to the tomatoes. A huge variety is available in all and a budget-conscious shopper has to contend not only with multiple price tiers, but also with the fact that products are organised by different weights too. “This bag of tomatoes is 75p for half a kilogram, but this packet is calculated as costing 16.7p each,” he says of the range at Tesco. “Which is cheaper?” Working this out takes some time. “We’ve been standing here for a few minutes now and you still don’t know. Customers will usually give up and just buy one,” Mr Adcock concludes.
WHAT CAN YOU DO?
As the success of round-pound pricing shows, customers appreciate clarity. Make your prices clear and understandable.
CONSUMERS DON’T KNOW THE COST OF THEIR SHOPPING
As we walk further through Tesco’s fruit and veg aisle we see a promotional end alerting customers to the price of pineapples. “£1 for a pineapple, brilliant,” says Mr Adcock, “but how much should a pineapple actually be?”
He explains that many customers trust a big promotional display price without really thinking about it. “I saw a deal in one supermarket where there was a big display of pears with a sign saying ‘Pears £1’. They were selling like hot cakes. At the store next door they were 60p each, but no one was buying because the display was bigger in the supermarket.”
WHAT CAN YOU DO?
Any retailer can do this. Place a sign with a price in a large font by a product you’re selling at normal price. Does it create uplift?
(SELECTIVE) MESSINESS MAKES MONEY
“It’s fine,” says Mr Adcock of the messy display of tinned tomatoes which greets us at Tesco. “People passing will think it’s a good deal and buy more.” Some larger stores actively create a messy environment in selected areas, he adds. “In department stores, on the first day of a sale, some stores put ripped up tissue paper on the floor just so that it looks like people have been fighting each other for bargains. Then shoppers think they have to get one.”
WHAT CAN YOU DO?
It’s no excuse for an untidy store in general, but if you’ve got a good deal, a display that looks like customers have been rummaging energetically for bargains might attract sales.
COLOUR IS EVERYTHING
“All Tesco’s fruit and veg used to be in black boxes and crates until they learned that it wasn’t a good colour for consumers,” Mr Adcock says. Instead we find everything from lettuces to aubergines displayed in boxes and packaging which is a more natural green.
WHAT CAN YOU DO?
Where possible, use attractive baskets, boxes, display units and so on to make displays appealing.
MAKING CHANGES IN A SUPERMARKET IS LIKE TURNING AROUND AN OIL TANKER
“Tesco has an annual range review, but that only looks at what’s sold by category,” explains Mr Adcock of how merchandising advice is implemented in major stores. “It doesn’t include trialling things like cross-merchandising. If someone at head office suggested putting DVDs by wine that would be far more strategic.” This sort of change would require a six-month trial and could take 12 months to implement fully, he suggests. “At the end of a trial, the buyers for the relevant categories need to be persuaded to do it permanently. Then the manufacturers need to be on side and to do a promotional deal to launch and support it.”
WHAT CAN YOU DO?
You have the freedom to make decisions quickly. So if you spot a new opportunity, a launch, or hear the supermarkets announce plans, act upon this immediately.
PICTURES OF SAD PUPPIES SELL TREATS
“You’ll see on this aisle they put pet treats in between the standard dog and cat food,” says Mr Adcock as we walk around Tesco. “You have to pass them on the way to your usual purchase and again on the way out. They put a picture of a sad or cute puppy above the fixture to make you want to buy your dog a treat.”
WHAT CAN YOU DO?
Think creatively about how you could use images or PoS material to influence spending. You too could adopt this tactic.
Hoping to gain a greater understanding of the strategies employed by the biggest grocers in the UK and where they succeed and fail, RN’s deputy features editor Tom Gockelen-Kozlowski took retail analyst and shopper psychologist Phillip Adcock to the Hertfordshire town. With a mammoth Tesco Extra, sprawling Asda and a major Waitrose store, Watford provides an ideal location to compare and contrast different supermarkets.
In keeping with sleuthing traditions, Mr Adcock meets RN with nothing visible to mark out his expertise. He is, however, acting as a double agent, having worked with major multiples over the past 20 years through his company SBXL to help them understand how their customers use their shops and what they really think of them.
Besuited with a noticeable lack of mackintoshes, dark sunglasses or any other spy-like camouflage our adventure begins. Trolley in hand, we start with a visit to a Tesco Extra in the south of the town. A huge branch set in the middle of a massive car park, this store dominates the local geography.
Of the three stores we visit, Tesco is the one which is struggling the most according to recent figures. While its profits leap over the £1bn mark every year, its own labels Everyday Value and Finest are two of Britain’s biggest-selling brands and it employs almost 300,000 staff, its profit warning last year spooked its shareholders, management and the markets.
As we walk through the store, it is clear why the company might be struggling, but also why it has been Britain’s largest retailer for so many decades.
As soon as you step through the door Tesco’s merchandising and ranging gets to work to make its shoppers spend. A display stand filled with bread rolls is the first sight we see. According to Mr Adcock, this is no mere accident. “The message these rolls gives you hits you straight away: this is a fresh store.”
In this Tesco, the impact of this first fresh impression is lost, however, as the layout pushes us through, not to the rest of the bread range or even that of the fruit and vegetables, but on to aisles and aisles of laptops, DVDs, home utensils and vacuum cleaners. “After five minutes in here we’ve seen no more food,” says Mr Adcock.
Badly positioned though it may be, the sheer size of this non-food part of the store shows how much of a priority it has become for the company. It now sells mortgages and banking services alongside computers, mobile phones and CDs.
“The store has changed very little since I’ve been coming here,” he says. “That’s because they don’t know what to do with it.”
His comment highlights the challenges that face every supermarket. When Tesco, Asda or Waitrose wish to implement changes in their stores nationwide, head offices must jump through innumerous hoops, conducting trials and research that last months. No wonder Mr Adcock rarely sees change.
From the displaying of tins to the organisation of the pet food aisle, the tips, information and analysis you can read above comes thick and fast as we journey through the aisles.
But as we leave Tesco, we note that in the hour spent there we had no interaction with any staff, not least because of the automated till service that most stores now use. Imagine an independent retailer having such little regard for customers (or spies) in their shop!
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