Brands have been flaunting their wares to discounters for some years now, often with differing pack sizes. Or “extra free” to achieve a pack size without upsetting Tesco.
However, recent years have seen brands further push their lines in to Aldi and Lidl notably, with the WIGIG space in both retailers growing.
Non-food is in slowdown so this has put pressure on discounters to find alternative uses for the space. This rather than have Rattan furniture hanging around forever.
So brands are useful here, as they want volumes so sell in to Aldi and Lidl, who then benefit with a larger basket spend. Customers also benefit because they can pick up brands at a lower price than they may find elsewhere.
It’s bad news for larger retailers who after price matching on a stable of products,. Find brands selling at a lower price in to discount…
Tesco did attempt to nullify this with their price match and low prices campaign. This meant that brands who were selling in to Aldi, had to give the same price to Tesco, much to the upset of suppliers.
But the branded presence in discounters central space continues to grow, they’ll never be listed permanently. Especially given the preference for own label in discount and the low prices wouldn’t be helpful on value comparative anyway.
But for a volume gain, it’s happy days.
It doesn’t feel like a strategy. But then, neither does more commercial income and signage in the larger retailers either……
