Retail Stars Blog Series - Range & Offer

Offering a range that caters for all of your customers is essential in today’s competitive retail space. I believe that shoppers are increasingly willing to leave loyalties aside if they feel a retailer no longer understands them or provides what they want. 

Below, I reflect on some key themes I’ve found relating to retail range and offer, and highlight the ‘retail stars’ in their efforts to adapt and evolve to best serve customers. (Please see the introduction blog from 25th October by Michael Mowat for more information on the Retail Stars blog series).

Private label vs brands: getting the balance right 

Getting the balance right between private-label and brands can be tricky. As consumers tighten their belts, own-brand products are often best positioned to provide value to customers. Aldi and Lidl are bringing the fight to the dominant UK supermarkets, and their market share is increasing year-on-year. Brand loyalty is wavering across the industry too: recent studies found that two in five (42%) UK consumers feel no loyalty to any fashion retailer, and one-third of grocery shoppers consider private-label as the most influential factor. 

Next is one of the major UK retailers known for its quality private-label offering. However, this doesn’t necessarily mean brands should be avoided. Next is now embracing brands in their online ‘LABEL’ business to complement the private-label offer. Most recently, Next signed a deal with Ted Baker to create and sell Ted Baker-branded childrenswear from Spring 2020. Adidas and Nike are some of the big brands featured on Next’s site. Providing premium branded ranges to customers serves to complement the existing Next-branded lines, rather than at its expense, giving shoppers more choice and reason to shop with them and achieving a sensible balance. This seems to be paying off - online sales in July 2019 were reported up by 12.6% year-on-year. 

Tesco is responding to the growth of private-label discount lines by trialling a new grocery brand, ‘Jack’s’, positioned as a competitor to Aldi and Lidl. This experiment expands Tesco’s range and builds on the launch of their own-label ‘farm’ brands. Jack’s stores stock a significantly smaller range than Tesco stores, but the core offer is standout low prices to match the two German discounters. Tesco is even preparing to introduce Jack’s-branded products into their standard stores. It will be interesting to see how this plays out, as Tesco focuses on developing a private-label range that offers significant value and being flexible to what customers want. 

Dynamic and diverse ranges

We all know retailers that heavily focus on their unique selling point (USP) to drive consumers in-store or online. Think of Waitrose’s reputation for top quality food and wine, the ‘Next sale’ - these are key appealing factors. But it seems that simply offering a range that caters for customers may no longer be enough. Offering a limited range that provides the best value and choice may not necessarily win the affection, and business, of customers in this era.  

Sainsbury’s has used its acquisition of Argos as a launchpad for rapidly expanding its range and offer to customers. Sainsbury’s is now not only the home of grocery shopping - Tu clothing line and Argos general merchandise are also available in growing numbers of stores; Tu clothing is available on the Argos website, and more standalone Argos stores are closing and being replaced by concessions inside larger Sainsbury’s stores. This powerful and diversified range is now available in one place: shoppers’ trolleys can vary from ready meals to winter coats, cookware and televisions!

Department stores are designed to offer a classic ‘diversified’ range to customers - how is this still working for John Lewis & Partners whilst its competitors struggle? The retailer’s ‘Never Knowingly Undersold’ value gives customers another incentive to shop with them, whilst continuing to revamp their existing ranges. John Lewis also offers exceptional customer service, modern store layouts and frequent investment, further outperforming competitors and ensuring customers truly feel they ‘cater for all’. I’ve certainly found this to be the case when doing my (last minute) Christmas shopping!

Primark is perhaps one retailer that sticks to what they know best, and it is still working. Primark may have an online presence that showcases their latest lines, but they continue to resist the temptation to build an e-commerce function. Their strong proposition of on-trend, exciting and low-priced items drive customers in-store where they recognise the value on offer. Primark’s core offer strategy not only avoids diluting their keys to success, but also keeps the costs down so their customers can still grab a bargain.  

A fresh and responsive range

We live in a social media age where customers expect retailers to respond to trends in the market in record time. It’s clear to me that retailers are increasingly under pressure to keep up with the latest fashions - so who are some of the retail stars doing this well?

Fashion retailers are now showcasing their latest ranges on popular TV shows to gain traction, with contestants wearing the ranges themselves. Missguided and most recently I Saw It First have exclusively provided wardrobes for islanders featuring on the infamous Love Island reality show. This opportunity to preview a range on the most talked-about TV show not only gives unrivalled marketing power, but also the chance to dictate the summer trends in fashion and give your range influence. 

I’ve also witnessed the rapid growth of vegan food in the UK and how the large supermarkets are responding. Tesco partnered with Wicked Kitchen to provide an exclusive range of vegan meals and introduced the famous Beyond Meat ‘bleeding’ burger to store shelves. Now Tesco is getting ready to launch its own ‘Plant Chef’ vegan line, to keep up with the latest trends and catering to shoppers’ preferences. This coincides with the upcoming launch of M&S Food on Ocado, where M&S is responding to the continued growth of online grocery shopping and taking the opportunity to expand their range to remain responsive. 

What can retailers learn from this?

I think that retailers can consider the balance of the private-label offer against brands - is their own-branded range giving enough value and choice to customers? Growing a more diverse range that can keep existing shoppers and attract new ones is vital as consumers grow increasingly disloyal to retailers. Is their range bold and innovative enough to keep up with the trends and customers’ appetites? 

Where do retailers go from here?

By frequently reviewing the overall offer to customers, and consider being in their shoes, retailers can see whether they are providing a diverse range that caters for their customers. I think it’s best that retailers keep an eye on upcoming trends and build in responsiveness to the supply chain, to ensure the range can adapt and suit customers’ needs at pace. 

I’d be interested in knowing who your Retail Stars are - join the conversation with #whoareyourRetailStars

The next blog in this series will be on Checkout Agility - so keep a look out for Victoria Wright's blog next week!