Today is 50 (fifty) days until Dave Lewis takes the helm at the UK’s biggest retailer. Grocery Insight are counting down to the start of his reign with an improvement point per day. Due to the growing nature of the list causing issues with our template, please click on Tesco to see all the posts containing the 66 ‘to do’ points. Today we consider the role of Finest*.
In the older days, Finest led the line for supermarket premium ranges alongside Taste the Difference from Sainsbury’s. Where JS continued to innovate and improve their OL category alongside the premium, Tesco stalled and hadn’t done a great deal with Finest for a number of years.
Finest was used extremely well by Sir Terry Leahy when fighting the discounters, pushing Finest meant the discounters with their embryonic offer were seen off. Until they returned with a cohesive offer across the range that allowed them to compete well.
The premium tier Finest range remained untouched in the main since 2010 and the packaging looked tired versus two relaunches by Morrisons of their premium tier and one relaunch of TTD by Sainsbury’s and the Extra Special tie up with Leiths by Asda.
The Finest relaunch went live around a year ago with great fanfare in store, launching relatively close to Christmas meant the business hoped that customers would trade up and treat themselves. They did, but not enough customers crossed the road to come back into stores, preferring to stay with Aldi / Lidl as the discounters offered opportunity to trade up.
Another issue was centred on price perception, where a theme for Christmas was about value and we know the discounters offer superb value. Tesco didn’t cotton and continued to push ‘Finest Christmas’ which was about good food but that came at a price, particularly when compared to the discounters.
The issue for Tesco is that Aldi / Lidl and to an extent Asda in the mainstream have lowered the benchmark for the price / quality equilibrium and brought in a premium element. Customers do trade up at Christmas but not anything like they used to, not only that but customers are shopping elsewhere and across more fascias than ever.
Premium products came not just at a premium price but also with premium packaging and this in itself can also put some customers off and there is a real appreciation for getting the most for your money. The quality of discounter OL is superb for a price of between value/core OL, thus making the premium product a harder task.
The question for Dave Lewis isn’t regarding Finest*, its regarding where that range should sit. Is there a need for a Finest flour? Can make that argument for the serious bakers, but we’re down a range rationalisation route again. Is there a need for Finest across every single food category? No. The PoS is good and the provenance works but is it needed across every range?
A cut of Finest product would go hand in hand with a merging of Value and core OL on certain categories too. With the customers realising that price and quality aren’t mutually exclusive, this makes the premium range a harder sell in store.
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