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Sainsbury's and Tesco: Retaining market share during the credit crunch Product Image

Sainsbury's and Tesco: Retaining market share during the credit crunch

  • Published: October 2012
  • 21 pages
  • MarketLine

Introduction

Sainsbury's initial campaigns promoted brands, own label products, and buying basic ingredients. As the credit crunch continued, Sainsbury's launched Live Well for Less. Tesco emphasized price in 2008 with the Discount Brands scheme, and in 2011 with the Big Price Drop.

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Highlights

In response to the credit crunch, Tesco emphasized price, launching Discount Brands in 2008 and the Big Price Drop in 2011. Tesco also diversified geographically. In 2012, Tesco issued a profit warning and announced it would put more focus on the UK business with a £1bn investment.
Sainsbury’s was the most profitable grocery retailer for decades before being overtaken by Tesco in 1995 and Asda in 2003. In 2004, Sainsbury's launched the three-year Making Sainsbury's Great Again plan. In 2008, underlying profit before tax for the year was £488m, READ MORE >

OVERVIEW
Catalyst
Summary
ANALYSIS
Sainsbury’s has successfully increased market share throughout the difficult credit crunch

Sainsbury’s has grown from one shop in 1869 to over 1,000 in 2012

Sainsbury’s immediate reaction to the credit crunch in 2008 emphasized saving

Brand Match and "by Sainsbury’s" help customers Live Well for Less

Sainsbury’s has consistently aimed to increase its store space
A series of failed marketing schemes by Tesco culminated in a profit warning in 2012

Tesco was founded in the 1920s and is now a leading global retailer

Tesco emphasized price above all else

The company has also had difficulties in overseas markets

Tesco issued a profit warning in 2012

Tesco plans to “build a better future” and concentrate on UK sales
CONCLUSION
Sainsbury’s has increased its market share, while Tesco’s share has reduced
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