Tesco yesterday began selling products from its fledgling Jack’s discount chain in its main stores for the first time.
Nine Jack’s-branded lines are being stocked in 850 Tesco stores until the 27th May as part of the retailer’s 100th anniversary celebrations, which kicked off in January. The Jack’s products include still mineral water, fruit juices, crisps, cereals, and lemonade – priced between 55p and £1.50.
Their introduction was accompanied by another round of prices cut across hundreds of branded and own label products as part of the Centenary celebrations. Tesco also launched its ‘Clubcard Prices’ promotion yesterday which offers the 19 million members of its loyalty scheme discounts of up to 50% on selected products.
The Jack’s move follows recent reports that the discount format, launched last September, is having limited success in attracting shoppers away from Aldi and Lidl. There are now nine Jack’s outlets with Tesco recently stating that it is still planning to open more after seeing a “strong response” to the format.
Analysts speculated that Tesco may be testing the potential of a more permanent roll-out of the Jack’s products to its main supermarkets to help with its attempts to combat the discounters. Others suggested that Tesco may just be trying to shift stock that hasn’t sold well in the Jack’s outlets.
Hmm, Jack’s in Tesco. Seems quite confusing tbh. Wonder what the logic is here. pic.twitter.com/FMs3hTAYvJ
— Lisa Byfield-Green (@LisaByfG) May 8, 2019
NAM Implications:
- Whatever the rationale, Jack’s products represent low priced options in these categories…
- …now in wider distribution than anticipated…
- Giving Tesco the option of ramping up in step with demand…
- Or quietly running down stock if not required by the market…
- Best wait and see.
