International Retailers I say, ol’ chap
In the UK, Aldi and Tesco are fighting a war on several fronts, notably price and delivery, and Tesco may be winning. A while back, Aldi was rapped on the knuckles for its ‘swap and save’ campaign which compared the price of a basket of goods to equivalent branded lines at Tesco. Tesco in turn vowed to match Aldi on private label brands, and this has resulted in a disclaimer on Tesco’s latest campaign that in fact, some Tesco own brand products may be cheaper. Tesco’s advances in online have also, in part, prompted Aldi’s partnership with Deliveroo, offering a range of 150 essential items for 30-minute delivery, having apparently decided that their previous standard delivery box service wasn’t going to cut it. In the US, in the meanwhile, Walmart and smaller, classier competitor Target have both enjoyed success in upping their sales during the pandemic, with the former seeing online sales increase +74% in the first quarter, and the latter +141%. However, Walmart’s earnings per share increased for the period, while Target’s declined. One of the reasons might be that Walmart sold consistently over the period, while Target enjoyed a spike when the US government’s stimulus checks hit the wallet in April.
Comment: The lessons of COVID-19 will set some retailers up for ongoing success when happier times return.