The overall emphasis on non-price characteristics and the relative
importance of the different characteristics in all countries provides
opportunities for retail managers to differentiate their firms away
from pure price competition. These consumer responses have been
important in shaping the marketing strategies of the food retail
companies and have allowed a range of strategies which range from an
emphasis on discount prices, to pure quality and service
considerations. These strategic directions are strongly supported by
promotional programmes which emphasise the characteristics of the
stores rather than the products which are stocked.
In Hughes (1994) information is presented which shows that food
retailing firms are ranked number one, nine and eleven in terms of
their advertising expenditure amongst all firms, which demonstrates
the overall importance of promotional activities to these firms.
These activities allow retailers to develop their own 'brands' or
images which are independent of the brands that are sold, and are
likely to be the source of control which food retailers are reputed to
exert over manufacturers.
Table 5Most important factor when buying food
(Percentage of respondents ranking first)
EUROPE461716 8 8
Belgium68105 6 7
France59186 7 7
UK511713 7 9
Italy481219 7 5
Spain402617 7 6
Source: Food Marketing Institute (1992)
Positioning of retail firms
In recent years food retail firms have pursued strategies which have
provided consumers with increasingly diversified opportunities for
purchasing food. The discussion above has shown that these
developments have been made possible by the wide range and changing
nature of consumer requirements. Firms have identified the
possibilities and have developed appropriate strategies to compete in
the market place.
The concept of competitive strategies is clearly developed by Porter
(1980) and has become an accepted approach for analysing the manner in
which firms within an industry compete...