Poor results demonstrate yet again that supermarkets must provide better service or risk losing more business
Asda’s latest quarterly figures are out, showing a 5.8% fall in sales at established stores in the 13 weeks to the 1st January. Morrisons, Sainsbury’s and Tesco supermarkets, by comparison, all showed better than expected financial figures for Christmas trading, and discounters Lidl and Aldi taking on a substantial share of the sales (nearly one million more customers than last year). What is next for the supermarkets?
Helen Dewdney, The Complaining Cow -- consumer blogger and author of How to Complain: The Essential Consumer Guide to Getting Refunds, Redress and Results! -- says that as customers shopping habits are changing. As we become more savvy about discounts, service, consumer rights and comparison websites, supermarkets will have to up their game. “Customers don’t have trust in supermarkets and this needs to be worked on”, she advises.
Pricing -- Consumers want consistent pricing. It even led to the Which? super complaint. The consumer’s voice is getting stronger and supermarkets will have to start listening. If one supermarket shows a lead, then they will win over many a customer so widespread is the complaint.
2) Something more? -- Supermarkets need to offer something over and above price. Price wars will have to end eventually. Rewards etc., will become more important as will service. Tesco leads the way in the clubcard points offering the most per pound and variety of how to spend them. In comparison Sainsbury’s reduced their points value in April last year with fewer choices to spend them on.
3) Price matching -- most customers don’t know how it all works, who matches what and what the rules are. Did you know that you had to have 10 branded items in the Tesco brand match scheme before it comes it comes into play? Fair play to Tesco for taking it off at the till but its rules are not completely transparent. Consumers want to know that they are getting value for money and price matching is only one way of showing this.
4) Listening -- Supermarket CEOs will have to listen to customers more. For example, Mike Coupe at Sainsbury’s shows signs of following Clarke’s leadership and downfall at Tesco. Last year when Sainsbury’s announced the decrease in nectar points per pound it said it would be making better and bigger offers, with more included in their double-up voucher scheme at Christmas. In reality the double up points scheme was limited to £20 per department with confusion around Christmas gifts and food. £20 limit on toys for a family of 4 isn’t very helpful either! It happened again in 2015. In contrast in 2014 Tesco simplified the doubling-up process so customers could spend across departments with no limit.
5) Discounters -- Consumers are flocking to the discounters, which do not offer the same range as other supermarkets, so people will not completely stop using larger ones and discounters may need to look at more expansion of stock.
6) Savings -- People are looking to save time as well as money and supermarkets will need to look at ways to make it easier and quicker for shoppers to use their stores. Tesco recently changed their minimum spend for click and collect from £20 -- £40 but Sainsbury’s has, so far, kept at £20 and Asda’s is free. It remains to be seen if the discounters will provide click and collect and deliveries which would bring more competition to the table and whether Asda will bring its collections in line with others.
7) Waste -- Consumers are becoming more aware of waste and how supermarkets treat suppliers. The BBC documentary War on Waste showed a farmer destroying crops it said Morrisons would not accept plus cancelled orders etc. Dewdney’s research of the issue found that actually some supermarkets are doing really well in reducing waste. She also uncovered the other side of the story from Morrisons regarding a number of issues which was not shown. Supermarkets need to do more in informing consumers of what they are doing or customers will come to their own conclusions.
8) Advertising -- Supermarkets should review their advertising campaigns. Sainsbury’s did well this year but Tesco’s campaign has brought much criticism, from sexism, to unrealistic and disbelief in characters.  Advertising on this scale doesn’t bring in the extra revenue to pay for it, so supermarkets need to win customers round in more engaging and innovative ways.
9) Customer Service -- Supermarkets will have to improve customer service. Marcus Williamson -- editor of the website ceoemail.com -- says that searches for the email addresses of supermarket CEOs are very high. Figures for the last quarter were:
Store Percentage Market share Expected ranking
Asda 50.48% 16.7% Tesco
Sainsbury 21.75% 16.2% Asda
Tesco 16.75% 28.2% Sainsbury’s
Morrisons 5.75% 10.7% Morrisons
ALDI 2.74% 5.6% Aldi
LIDL 2.53% 4.3% Lidl
Williamson cautions that Asda clearly needs to work on customer service and complaints policies and procedures.
Contact for media enquiries
Book: How to Complain: the Essential Consumer Guide to Getting Refunds, Redress and Results! (ISBN: 978-0993070402)
CEO email website: CEOemail.com
 Research available on request
 Tesco takes flak in the battle of the Christmas adverts http://ow.ly/YuqRk