Beyond price

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With Tesco opening multiple Jack’s discount stores, the attention and conversation around the discounter channel is more apparent than ever. The interest around the channel is not without reasoning as we have seen penetration into Aldi and Lidl rise from 49% to 59% within the past two years (HIM), writes HIM’s Alice Dolling.

What is driving this flurry of shoppers to the channel? Price and value for money are incredibly important, however, as identified in HIM’s Future of Convenience, the rise of the ‘experience economy’ is one of the most important global trends for 2018.

This reflects in the figures; Aldi and Lidl shoppers are both rating the importance of ease of shop, store appearance, speed of service and quality of staff all above a seven out of 10, where 10 is very important. So while price and money are the most important factors, the experience cannot be ignored.

HIM recently made a trip to Jack’s and what we found was a step beyond the price tag. Of course, pricing POS was extremely clear and there was a high quality range of own label, but there was also a strong and obvious focus on making the experience positive for the shopper. Perhaps this is where Jack’s hopes to excel against the long established Aldi and Lidl brands.

Technology played a role as the store not only offered free wi-fi to shoppers, it also had a ‘scan as you shop’ app. Apps such as these make way for employing staff for different reasons, and with more activity at self-checkouts there is an opportunity for more staff on the shop floor as opposed to on the tills. There were multiple members on the floor and staff were friendly, interactive and knowledgeable about products.

What’s more, they haven’t forgotten the basics when it comes to in-store experience – we know that the main shop mission is the most prominent in the discounter channel, and therefore the wide aisles facilitate ease of shop as shoppers can easily pass each other with a trolley.

So what can we conclude? With multiple players now in the market, and perhaps more to come, it will be very important for discounters to start to differentiate themselves beyond price and value to have that competitive edge.

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