Knowledge Bank Blog, Channel Execution

Jack’s – What We Can Learn

Are you focusing on the fundamentals?

Right, let’s start a blog about the new Jack’s stores by talking about…Vince Lombardi and the Green Bay Packers.

In the 1960 NFL Championship (now called the Superbowl) the Green Bay Packers were leading the Philadelphia Eagles 13-10 in the 4th quarter.  They had just a few minutes to hold onto the lead.  But they couldn’t do it.  The Eagles scored a late touchdown and won the game 17-13.

The result hit the Packers players hard. But, by the time the players came back to training in July they were keen to start working on the new things that would take them to the next level.

Vince Lombardi, the coach, had a different plan.  He went back to the fundamentals.

The first thing he did was hold up a football and said “Gentleman, this is a football”.  He then proceeded to methodically cover all the fundamentals throughout the training camp.  They reviewed how to block and tackle.  The opened up their playbook and started from page one.  They went back to first principles.

It worked.  Just over 6 months later the Packers beat the New York Giants 37-0 to win the 1961 NFC Championship.

Why tell this story?  Well, a few days ago we took a road trip to the new Jack’s store in Chatteris.  There has been a lot of commentary about the launch of Jack’s.  Some think that it will work.  Others don’t.  We think it is too early to say and, ultimately, may come down to whether Tesco (and their suppliers) can make the financials work.

What we want to talk about is what we saw.  Because what we saw impressed us.  It impressed us with the real focus placed on the fundamentals.  It is a focus that Aldi and Lidl have driven in the market over the last few years.  But perhaps a focus that has been taken one step further through Jack’s.

So what are these fundamentals and what can we learn from them?

Merchandising ClarityBe really easy to shop.  No shopper has ever said “what I’d really like you to do is make it a bit harder for me to find what I’m looking for”.  Yet, we still see many categories in many retailers that seem to do just that.  Time and energy shoppers spend navigating and finding is time and energy they do not spend engaging and buying.

How is this being addressed in Jack’s?  They follow a simple 3 step process.  Firstly, clear category signage.  For instance, you are in no doubt as a shopper where milk is located.  Secondly, clear sub category signage.  For instance, shelf strips on the freezer to call out “party food” so shoppers can navigate within a section.  Thirdly, clearly merchandised shelves, so that shoppers can find things quickly.  Having fewer SKU’s helps.  Having products sitting on a shelf rather than boxes stacked on top of each other helps too.

Range ClaritySell the stuff that sells.  The Jack’s in Chatteris is right next to a Poundstretcher.  You may have seen the Channel 4 programme on Poundstretcher a few weeks ago.  It showed that a lot of ranging decisions were based on the deals their buyers could get.  Get a great price on some pallets of product.  Then hope shoppers will buy them.

Jack’s focuses on selling the products shoppers actually want.  An example is Sandwiches.  They offer ham, cheese, egg, chicken, tuna and prawn.  That probably covers 95% of the sandwiches people normally eat.  The ranges in other categories are similar.  What do shoppers want to buy?  Let’s focus our attention on those things.  Sounds obvious.  But it often doesn’t happen.

Price ClarityBe really easy to process.  Shoppers don’t walk around grocery stores doing the maths.  They make simple, intuitive judgements about what is good value.  The prices in Jack’s are low.  They show those prices very clearly at shelf.  Then they don’t talk any more about those prices.  They don’t try really hard to convince shoppers about the value they are getting.  They trust that shoppers will see the value, when they come to pay.  Compare that to Poundstretcher next door.  They are trying really hard.  Shouting value at shoppers in a variety of different ways.  None of which are very clear.

Proposition ClarityBe single minded, be consistent.  Retailers and brands often try to communicate lots of different things.  Walk around Jack’s and you will see one key thing being communicated – British sourcing.  “Every drop of fresh milk is British” or “All our crisps are made with British potatoes”.  It’s a simple lesson.  Decide what you want to stand for.  Then tell shoppers.  Tell them clearly.  Tell them consistently.

This is also done through the Jack’s brand.  Most of the food and drinks are Jack’s branded.  The packs are all recognisably Jack’s.  They have simple designs.  They are designed consistently across category.  There are few tertiary brands (ironic given what Tesco have done in the main estate).  It simplifies choices for shoppers.  It (potentially…) builds trust amongst shoppers.  Trust the Jack’s brand in one category, trust it in most categories.

You might think Jack’s will work.  You might not.  Either way, there are a number of things we can learn from what Tesco are doing.  And one big thing – focus on the fundamentals.

Shoppers want simple solutions.  It is our job to provide them.

Feel free to forward.  Have a great weekend and speak to you next week.

#Jacks #Tesco