The move follows a pretty nasty set of Christmas trading results for the supermarket: it issued its first profit warning for two decades after sales dropped by 2.3% in the six weeks to January 7, which means the much-hyped Big Price Drop campaign failed to make the impact the company had clearly been hoping for. (Although Tesco insisted that this was partly because its price-cutting had been so feverish that it had actually caused ‘a deflationary effect’).
Tesco’s main problem over the past couple of years has been that while less well-off customers have defected to Iceland, Aldi and Lidl, its richer customers have traded up to Sainsbury’s, Waitrose and M&S – leaving Tesco slap bang in the middle. But is the plan to be all things to all men wise? After all, it’s arguable that Woolworths attempted to do the same thing – and look where that ended up.
The supermarket was keen to point out, though, that this is merely a slight change from the way it already does promotions: at the moment, it tailors its promotions to the shopping habits of customers in particular areas, based on how they use their Clubcards. And it promised that although different products will be promoted in different areas, the prices of everyday staples will stay the same. So wherever you are, from Land’s End to John O’Groats, your carrots should cost the same.