Over the past decade, Aldi and Lidl have created quite a stir in the UK – and risen in market share – courtesy of low, low prices and their expansion of stores.
But some customers aren’t buying them, or at least not buying in them. Tesco, for instance, has remained a constant atop that share leaderboard and even gained a bit in the past couple months, according to data from Kantar Worldpanel. Other more expensive supermarkets continue to welcome in customers, although perhaps not at the same clip as they did before the discounters arrived.
What is it about Waitrose, Sainsbury’s, Morrisons, ASDA and the aforementioned leader that keeps them coming back?
A new study from small business experts Bionic reveals that it stems simply from loyalty to those brands. Even during inflation or a pandemic – even when customers increased their Google searches for cheapest supermarkets in the UK – they still spend their pounds at traditionally more expensive outlets. And there are other factors at play, as well.
“All supermarkets want to become a customer’s go-to place to pick up their daily essentials, and ultimately people are going to return most often to their favourite establishment, which can depend on a number of different factors,” Glyn Britton, Chief Customer Officer at Bionic. “For many people price plays a large role in where they shop. Tesco has certainly acknowledged this with their loyalty scheme. However, convenience also plays a massive role in customer choice. Ultimately customers are most likely to shop at their closest store, meaning shops with the most and best-situated locations will find it easier to attract these ‘convenience customers’.
Bionic analysed metrics from simple searches, social media and YouGov’s BrandIndex and found that while shoppers are searching for bargains, they’re also searching for quality and customer service. Loyalty schemes, club card points and other offers (such as Aldi price matches or buy 1 get 1s) are a bonus … and something customers are also looking for in their searches.
So, while a shop at Waitrose might cost £16 more for the same basket of items than Aldi, customers remain loyal. In the Bionic survey, the John Lewis’ brand achieved the best score among supermarkets on brand loyalty at 64.4. It also was far and away the best on brand awareness (88.5 out of 100, beating out ASDA in the category by more than 27 points).
“Waitrose’s high brand loyalty shows, quality and public perception can help boost your perception despite high prices,” says Glyn Britton, Chief Customer Officer at Bionic. “This is because the brand can be seen as aspirational, customers are less sensitive to price and are not just buying a product but an experience they’re willing to invest in.”
The next most popular brand, according to Bionic, is Tesco, which achieved a brand loyalty score of 56.25, helped recently by its dominance in online delivery. Next is Sainsbury’s at 51.89, followed by Morrisons (48.15) and ASDA (47.53), all of which are more expensive than shops at the discount retailers. In terms of brand reputation, Waitrose tops the list by a wide margin (2.52) and is followed by Morrisons and Sainsbury’s. Tesco and ASDA are both a full point behind the leader.
Bionic also looked at the number of Instagram followers in its assessment of British supermarkets, and how that can be a difference maker in gaining young shoppers. Of those five, Waitrose tops the list (58,600), narrowly edging ASDA (58,000). Tesco has more than 54,000, while Sainsbury’s and Morrisons are both struggling to gain a following. None of them, however, does well in terms of engagement.
