The title says it all!
Supermarkets do cheap extremely well.
To such a degree that no one, and I mean no one, can compete.
We all say we want better quality wines.
We all say we want to discover something else but, when push comes to shove, we always go back to buying in supermarkets!
– Whether or not we know the producer on the label.
– Whether or not we think we know the wine.
We don’t really care.
As long as the colour is right and the price is cheap!
AND… don’t kid yourself. Convenience has little to do with it.
Many off-license chains have set up in the same commercial centre as a large supermarket and they do not sell more just beacause of that.
The supermarkets even started setting up separate shops next door to themselves in a commercial centre and their sales plummeted as well all thought they were selling more expensive wines. (or even the same wines dearer).
Have you asked yourself WHY we buy wine from supermarkets?
- We don’t always like what they sell.
- We don’t always think the flavour is what it should be.
- We often end up with a massive hangover the next morning!
Let me answer that in one short line.
Supermarkets are cheap.
In fact, they are so cheap that they sell some lines under their cost price.
Did you know that?
Yes, amazing but true.
Selling under cost to engage consumers to come into the store and BUY OTHER PRODUCTS is called using a “loss leader”.
The average over-spend in a supermarket in the UK is £50.
Just for a bottle of cheap wine! (or whatever…)
So they, the supermarkets, know that you are going to spend £50 minimum because you want to buy a bottle or two of wine.
They know that you will probably spend more. They have lots of tricks like TFT (is this still legal?) offers and nice smells of baking bread. (Never go to a supermarket before a meal!)
They know you will kid yourself into liking the wine…
Because it is cheap!
Recently there has been a move by the supermarkets to add more quality wines into their stock.
Apparently, even the supermarkets are beginning to feel the pinch of the “loss leader” syndrome and think it is time to ask people to pay up for a better quality wine. The more expensive the wine, the larger the margin!
But, we the people do not really want to do that.
We do not want a more expensive bottle of wine from the supermarket.
So the supermarkets are losing money on their cheap wines because they are still selling them as “loss leaders” and they are also losing money on their more expensive lines as – who in their right mind would buy a bottle of “quality” wine in a supermarket?
What a conundrum!
I really cannot wait to see how they get themselves out of this predicament.
If anyone has any ideas on this please email me, email@example.com and put the title of this blog into the subject line.