John Lewis this morning published an updated version of its famous wartime Make Do And Mend pamphlet, but sister supermarket chain Waitrose is showing customers its own way of dealing with the recession.
By any logical reckoning, Waitrose should be a recession loser. It has a reputation for being expensive but the way it has navigated the downturn is a textbook example of how to respond when your customers’ circumstances change.
What MD Mark Price has realised is that Waitrose had a very easy win staring it in the face. Shoppers were visiting Waitrose for the things its customers knew it was good at and which they perceived were special - the Sunday joint of meat maybe. But then they were doing another shop elsewhere for the basics that often taste the same everywhere but were perceived to be more expensive at Waitrose.
The rebranding of its basic products as Essential Waitrose, at lower prices but with no compromise on quality, appears to have been a very clever move. Heavily marketed to make sure the message got through, it looks to have succeeded in persuading shoppers they can do their entire shop at Waitrose at no extra cost. According to the TNS data published last week Waitrose is growing faster than any other grocer, with its 10.2% growth almost double the sector average.
The Partnership is a very nice organisation, and Price is a very nice bloke. But make no mistake, he, and the organisation he leads, are ruthlessly focussed on growing the business at the expense of its competitors, and the opportunity is huge, as Waitrose’s geographical coverage is still patchy. There is also a big opportunity to grow the online business Waitrose Deliver, although the relationship with Ocado continues to baffle shoppers. Still, the Waitrose example is a good lesson to those, particularly some of my colleagues in the media, tempted to draw obvious conclusions about the impact of the recession.
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