Commercial property supermarket chain Tesco has abandoned its well-known Value range of goods, in favour of an updated line of foods, as it continues its fight back against competitors.
The variety of goods will be called Everyday Value and will abandon the plain blue and white stripes in favour of more upmarket, vibrant packaging which features 1950s-style line drawings of food and kitchen equipment. It looks somewhat similar to commercial property Waitrose’s Essential range of goods.
The commercial property company maintains that the change is more than a rebranding exercise and many of the 550 lines are being significantly improved, either in packaging or content. Fish fingers, for instance, now contain 100 per cent fillets of fish, the apple sauce contains 33 per cent more apples and the cheddar comes in a resealable bag. The commercial property supermarket chain also says its mince contains a reduced amount of fat.
Ditching the Value brand, however, is a daring move by commercial property supermarket chain Tesco. The Value range, launched twenty years ago, came about in response to the early 1900s downturn, the aggressive development of commercial property chain Kwik Save and the arrival of European commercial property cost-cutters Aldi and Netto.
At the time, the selling of simple, intentionally cheap-looking products was dismissed as a potentially brand-damaging move. However, Value went on to set the trend across the industry and it allowed commercial property chain Tesco to increase its market share from 15 per cent to 25 per cent in the space of a decade. In doing so it stole the prized number one crown from commercial property chain Sainsbury’s and it never looked back.
Value is just one of four commercial property supermarket sub-brands that had more than £1 billion in sales, and it is understood to be the largest of them all. According to Kantar Worldwide, the other commercial property supermarket sub-brands are Asda Chosen by You, Tesco Finest and Waitrose Essentials.
Nevertheless, over the last 18 months the commercial property supermarket chain has been struggling in the UK, with underlying sales tumbling. It had lost market share to commercial property chains Iceland, Sainsbury’s, Asda and many others. It acknowledges its Value range looks worn-out compared with Morrison’s’ M Savers range, which substituted its own cheap-looking Morrison’s Value range and Waitrose Essentials.
According to Kantar, own-label low-priced ranges have grown 9.3 per cent over the last year, but it is understood commercial property supermarket chain Tesco’s Value range has considerably underachieved this level.
Tesco UK Marketing Director, David Wood, said: “Tesco was the first supermarket to launch a Value range back in 1993, the blue-and-white striped brand giving customers a down-to-earth option. Almost 20 years on and an affordable quality range is more relevant than ever, but customer needs have changed.”
He added: “We have listened closely to what our customers want and Everyday Value will provide products that taste better, look better and are healthier-still at the same great price.”
More specialists were impressed with the appearance of the new brand and how it demonstrated that Tesco was starting to look at the quality of its goods, not just costs.
Neil Saunders at Conlumino said: “There is a large segment of the shopper population who want keenly priced everyday products without having to sacrifice too much on quality; in other words they want great value for money, which is much more than about just price.
“Tesco is a company with many challenges. However, if this sort of thinking is a sign of things to come it bodes well for the future.”
