INTRODUCTION | 3 |
EXECUTIVE SUMMARY | 4 |
MAIN REPORT | 23 |
Part A: The Discounters | 24 |
| 1. The Growth of the Discounters: Under the Radar Screen | 24 |
1.1 Current Market Share and Projected Expansion Plans | 25 |
1.2 Category Penetration | 28 |
1.3 Category Penetration in Europe | 31 |
1.4 The Race for the Dublin Market: Will they Succeed? | 32 |
1.5 Whom have the Discounters Affected? Whom will they Affect? | 36 |
| 2. Discounter Strategy and Appeal | 41 |
2.1 Reasons for Lidl/Aldi Growth: Economic Slowdown | 44 |
2.2 New Consumer Attitudes Towards Price: Perception Versus Reality | 45 |
2.3 Real and Perceived Inflation in Europe | 49 |
2.4 Understanding Discounter Appeal: Price, Brands and Novelty | 49 |
2.5 Socio-demographics of the Discount Shopper | 54 |
2.6 Lidl and Aldi in Other European Markets | 56 |
Part B: The Price War | 60 |
| 3. Traditional Retailers: Current and Future Reaction | 60 |
3.1 Tesco Strategy | 62 |
3.2 Dunnes Strategy | 68 |
3.3 SuperValu Strategy | 71 |
3.4 Superquinn Strategy | 76 |
3.5 What is the Right Retailer Strategy? Price Versus Differentiation | 79 |
| 4. Reaction from Manufacturers | 82 |
4.1 Price, Cost and Margin Pressure on Manufacturers | 86 |
4.2 Doing Business with the Discounters: Problems and Opportunities | 89 |
4.3 Brand and Own Brand Responses | 92 |
Part C: The Future | 96 |
| 5. Looking Forward: Is there Life beyond Price Activity? | 96 |
5.1 Merchandising Techniques and Clarity of Offer | 96 |
5.2 Promotions and Pack Sizes | 99 |
5.3 Range, Service, On-shelf Availability and Retail-tainment | 103 |
5.4 Category Management, Shopper Insight and Loyalty Data | 108 |
5.5 Retailer/Manufacturer Co-operation | 112 |
| 6. Bringing Political Pressure to Bear | 115 |
6.1 The Planning Environment | 115 |
6.2 The Question of Irish Sourcing and Irish Jobs | 116 |
6.3 Lifting the Ban on Below Cost Selling? | 119 |
| 7.Ireland in a Europen Context | 123 |
7.1 The Internationalisation of Retailing | 123 |
7.2 Currency Fluctuations and the Euro | 124 |
7.3 Future Prospects for Irish Grocery | 125 |
Charts | 128 |
| 1. Real and Perceived Inflation in the Euro Zone 1998 - 2003 | 128 |
| 2. Euro and Sterling Exchange Rates 1998 - 2003 | 128 |
Published: October 2003
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