Thursday 15 November 2012

Happy own-brand Xmas, how Ansoff can help?

Given Sainsbury’s predictions that this will be an own brand Christmas as hard-up Britons “splash out” to enjoy a family Christmas, making their money go farther via own-brands perhaps the Ansoff Matrix can spell out the moves and help suppliers to anticipate the impact…?

As you know, Ansoff identifies four ways of growing a business by selling:
- More current products to current customers
- New products to current customers
- Current products to new customers
- New products to new customers

How Sainsbury’s could increase own-brand sales

More current products to current customers:
Essentially, as most produce sales are own-brand, coupons and keen prices and store-level assortment could encourage purchase of larger portions of Christmas meats turkey, fruit & veg, with pricing delicately balanced to avoid over-purchase/waste….making current customers happier

New products to current customers:
Here the emphasis could be on encouraging purchase of complementary Christmas items both food and non-food, brands & own-brands, with in-store promotion/theatre and linked couponing to tease custom away from branded alternatives and other mults/channels via current JS customers in the aisle – making current customers even happier....

Current products to new customers:
By studying the profile of their current customer, JS could seek out new shoppers of similar profile, and try to attract them to the store via the own-brand products that appear to appeal to current JS customers, given that they probably have similar appetites. These new customers will need to be attracted and retained by a combination of virtually one-to-one communication and coupon-swaps to encourage a first-time switch from their traditional Christmas destination. To achieve an acceptable ROI, this has to result in an unprecedented and compelling experience, well suited to the JS approach.

This will probably be the most competitive segment as Tesco tries to recover lost share/customers and retain its current customers via its £1bn investment programme…

New products to new customers:
This high risk alternative means trying to attract new shoppers and sell them new products, targeting consumers that are unaccustomed to the JS experience, with products that are new to JS, a double-whammy that may attract the risk-seekers, but will probably play a small part in own-brand Christmas..

So, from a supplier’s point-of-view, this is all about own-brand, wrong!
This is about how a skilled and systematic retailer is going to make this an unforgettable own-brand Christmas, using differentiation to build and hold an enlarged customer-base, at the expense of brands…unless suppliers make Ansoff work even better for their brands…
PS  For insight on the subtle moves see our free paper : 4 generations of private label

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