Magazine article Marketing

Tesco Narrows the Gap on Discounters

Magazine article Marketing

Tesco Narrows the Gap on Discounters

Article excerpt

Tesco's introduction of its discounter-bashing "Value" range of low-cost, own-brand lines will not make much difference to average prices, according to a new study.

Even before the introduction of the range (Marketing, July 29), Tesco had already undercut Asda to become the cheapest of the 'Big Four' food retailers in Verdict Research's latest quarterly survey of food prices.

Further Verdict analysis since the survey was completed suggests that the introduction of Tesco's Value range will have little, if any, effect on the price of a typical basket.

"The Value lines have supplanted the tertiary brands that were there before and the cost of the basket remains broadly similar," says Verdict's marketing manager Deborah Grant.

The survey, based on a selection of 40 staple items such as bread and milk, shows that prices have fallen steadily across all food retailers since the survey was launched last September. The price of the average basket has dropped by almost 8%.

The Tesco's basket cost |pounds~33.03 in the three months to July -- down 7% on the previous quarter. …

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