So far this year, we’ve had Price Drop 2 from Tesco which has felt a bit of a damp squib unless you enjoy seeing beautifully decorated and merchandised traditional market stalls in front of gapy actual produce departments. Co-op have weighed in with a well-designed, but poorly executed, campaign under the “Fair & Square” banner. Asda of course, are always 10% cheaper anyway, which is why I got £10 back off an £80 shop through Asda Price Guarantee recently.
But this week, Morrisons raised the stakes with a wide-ranging selection of cuts across the store. But “I’m Cheaper” is way more and could potentially be a game-changer for the trade, if not for Morrisons.
First of all, there’s the execution. They’ve been working hard towards maximizing impact in stores with the decluttering that has been happening recently. With less clipstrips and the banishing of the dreaded wire bins and manufacturers shippers, any big launch would be given a chance to be seen. And be seen it is – the design is uncharacteristically simple and is consistent across all categories and all forms of POS. But more importantly, it’s landed in one big hit with no signs of it being implemented. I can’t remember the last time I went into a store at 9am of a big launch and saw everything up with none of the store staff walking around with various bits of cardboard and fixings while scratching their heads. Security covers, barkers, wobblers, displays and even hanging boards (and there’s one in virtually every aisle) were all in place. Even Tesco didn’t get this impact when they launched their “Love Every Mouthful” and, although there’s been better execution of “Down and Staying Down”, its scope is limited to the aforementioned market stalls. “I’m Cheaper” touches every single corner of the store. Wow.
But there’s more – can you remember the last time a retailer was so shopper-focused with their message? Usually price cuts are announced with big numbers hoping to communicate the scale. However, to the shopper they sound more like Dr. Evil in the Austin Powers films saying “a beeelion pounds”. Morrisons are talking about the number of products they’ve the cut the price on – “over 1000”. That’s a number shoppers can understand– it’s big, but not so big that they can’t get their head round it. £100million of price cuts might not seem much when they hear about profits of £1bn plus, but 1000 products seems big, especially as most probably don’t realize that there’s likely to be well over 15,000 products in the average superstore.
So far, so good then. But what this exposes is an underlying weakness with Morrisons in terms of their ability to build a modern dynamic retailer. When they do stuff with scale – a price launch, new channels, store formats, etc – they are market-leading in terms of ideas and execution. But they continually fall down on the small category level projects and even relatively normal work such as range reviews. At this level, from a suppliers perspective at least, there feels like there’s a lack of real leadership and this lets the cultural in-fighting between the pre and post Ken-era people in head office take over. Unfortunately, for all the glamour of the big stuff, it’s selling beans and doing it better than the other grocers that makes the difference. You see evidence of this in the M Local and M Discount formats – great concepts, beautiful shops full of innovative details. But the ranging is terrible – speak to the buying teams and most deny any knowledge of it, and even less interesting in trying to sort it out.
I have a real soft spot for Morrisons – I like their attitude, I like the fact they’re trying new things and they’re certainly the only ones trying other things as well as price to battle the discounter threat. But until they resolve deep-rooted cultural issues internally, they will continue to struggle. Time will tell if this latest initiative works – the “stonking deals” activity in the Christmas run-up did nothing for them, but this is a whole different affair. I wish them luck and also hope to see more great big ideas coming out of Bradford as long as Dalton can hold on.