Dyson preparing to hoover up the re-chargeable battery market?

News that Dyson will spend £1bn – plus a UK grant of £16m in last week’s budget - on battery development over the next five years has to serve as a warning that this innovative disruptor is on the move again…

Following a 2015 acquisition of Satki3, a U.S. maker of solid-state lithium-ion batteries for $90m, having previously invested $15m in the Michigan firm, Dyson is ready to invest in the firm’s discovery that it has found a way to produce batteries with twice the energy storage potential of standard lithium-ion models, at a half to a third of the cost.

A step too far?
I still blush when I recall a very early competitive brainstorming session conducted for a defunct supplier where we concluded that whilst a see-through vacuum cleaner model might appeal ‘in the shop’, the first-use viewing of gathered dust would soon alienate most consumers…Dyson obviously knew better...

• While the immediate application for new batteries would probably be in Dyson’s existing cordless products, they have potential uses in everything from electric cars to tablet computers
• In other words, imagine the disruptive appeal of twice the energy storage potential of standard lithium-ion models, at a half to a third of the cost...

Tesco Takes On Discounters With Seven New Value Own Label Ranges, So?

                                                                                                                                pic: Marketing Week

News that Tesco stepped up its fight against the discounters yesterday by launching a host of new value-orientated own label ranges in the fresh produce and meat categories raises some questions:

• What are the chances of Tesco value-labels possibly being perceived as 'cheap' versions of the Tesco brand, a downward stretch, whilst discounter surrogate labels look equivalent to brands in quality, an upward stretch?
• Same quality, same price, different perception...?
• ...and the ultimate question being: Which customer is more likely to say “Wow”?

Sainsbury’s Confirms Offer for Home Retail - the next steps and imlications

News that Sainsbury’s moved a step closer to sealing the takeover of the Home Retail Group/Argos on Friday, by tabling a formal offer for the business after rival bidder Steinhoff International pulled out, raises a number of implications...

NAM Implications:

• Whilst as yet, there is no obviously sign of an amply-proportioned lady vocalist preparing to take centre-stage, this looks like a done-deal...
• Obviously the competition authorities will play their part - delay & distraction - but management’s immediate focus has to be on squeezing costs and generating synergies from the mix…
• This has to result in well-heralded store closures - otherwise why bother to acquire - and if this means 300 Argos being transferred into nearby space-to-spare Sainsbury’s branches, so be it
• Ultimately, the Sainsbury’s-Argos combination has to perform better than the separate entities
• ...meaning opportunities for visionary suppliers

Driving Demand, Government-style...

Unit-pricing: The 'missing' ingredient in price comparison

The latest Which? Report highlights the 'up to' 4x premium shoppers pay for the convenience of pre-sliced and pre-portioned foods. The price disadvantage of buying smaller sizes of other essentials is also highlighted.

Whilst retailers can obviously point out that in most cases the unit price is displayed on the price-label to facilitate like-with-like price comparison, the only problem can be the fact that many consumers do not understand the meaning of unit pricing, apart from the mental gymnastics required in breaking down 100g, kilos and volume-equivalents in the case of liquids.

In effect, the unit-price serves little useful purpose and may even add to the confusion of the shopper...and given that confusion leads to suspicion, it can be seen that the real casualty is trust in the retailer...

On-shelf education could be applied via a standardised category league-table of price per 100g comparisons, in very simple language...

Patronising? No way. We are not talking about degrees of intelligence, merely accepting that a busy, distracted shopper is only giving 10% of their attention to true comparison, based on a reasonable level of trust in the retailer...

Allowing the current confusion to continue can lose both trust and shopper...

Of course teaching consumer-shoppers to understand unit pricing makes the consumer better-informed and more difficult to mislead...

Welcome to the new world savvy consumer!

Professional NAMs already take that risk by helping the buyer to make valid like-with-like comparisons, thereby making them more demanding, but the current climate demands a fully informed supply chain.

Helping the 'buyer' to buy can help...

Aldi/Lidl - Home of the missing 'Wow'?

'Aldi and Lidl starting to look like 'conventional' supermarkets', but they are not...

Recent statements by Sainsbury's, Asda and Tesco implying that discounters are adopting some aspects of conventional supermarkets -including costs - but will not match them on range and service miss a point that may be worth considering.

A visit to your nearest Aldi/Lidl will confirm that 'Wow' is a significant ingredient in the discounter offering that may have been bred out of multiple offerings by EDLP and 100% availability...
Furthermore, as the mults increasingly cut prices to match the discounters, they might need to consider possible consumer-shopper reaction in each business model:

• When prices are lowered from the long-established 'norm' in a conventional supermarket, the reaction may be 'why are they only charging this price for such good quality?'
• ...whereas, in a discounter offering the same quality at a slightly lower or even the same price may cause a shopper to ask 'Wow, imagine this quality for this price'...!

In fact, as supermarkets lower their prices to discounter levels, they may still be subject to this difference in reaction.

If 'wow' is now the missing ingredient, the way back for the mults is surely via customer service, something the discounters can never hope to match...

In other words, why not aim at evoking the aisle-response 'Wow, imagine them giving me this degree of personal attention on a simple request!'

What if Bent Veg become the New Straight?

News that Tesco has joined Asda and Morrisons this week in launching a ‘wonky veg’ range in its stores, as part of an 11 step food waste reduction campaign, raises a number of issues for stakeholders.

This initiative will obviously benefit the ever increasing needy and also reduce the pressure on farmers to meet ‘perfect shape’ specifications, resulting in less delivery-rejects.

However, suppose ‘wonky veg’ also touches a live nerve with consumers, appealing to their appetite for ‘natural’, down-to-earth food that also happens to be cheaper because of its imperfection…but tastes as good as, or even better than the ‘real thing’?

(NAMs closer to the category will know that taste and flavour were long ago compromised in the pursuit of perfection in shape).

In other words, if ‘wonky’ becomes mainstream, and even grows to say 50/50 share with ‘straight’, are we then on a road to specifying different degrees of ‘wonkyness’ in a new range of wonky sub-categories, ‘re-upping’ the pressure on farmers to meet the new specs, and also diluting retail profitability…

We are truely living in crazy times…