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Brand Strategy Report

     MKTG 317
Executive Summary


The UK grocery market is extremely competitive. With the demand of food products being
regularly affected by cross price elasticity; retailers must ensure that they are constantly
exploring new and innovative methods to achieve a differential advantage over competitors
(Mitchell and Kiral, 1998). This report will assess the current brand strategy of discount
grocery retailer Lidl and provides recommendations on how Lidl can improve and
differentiate their brand by adopting a fresh and invigorating brand image.
Contents
1.0 Introduction ......................................................................................................................... 1
   1.1Company Background ....................................................................................................... 1
       Figure 1.0 Lidl Timeline ...................................................................................................... 2
   1.2 Organisational Strategy.................................................................................................... 2
2.0 Existing Brand Architecture and Strategy ............................................................................ 3
   2.1 Existing brand Architecture ............................................................................................. 3
   2.2 Existing Brand Strategy .................................................................................................... 3
       Figure 2.4 Current Mood Board ......................................................................................... 5
3.0 Positioning............................................................................................................................ 6
   3.1 Competitor Analysis ......................................................................................................... 6
       Figure 3.2 UK Grocery Market share January 2012. .......................................................... 6
       Figure 3.3 Lidl’s competitor Analysis ................................................................................. 8
   3.4 Positioning Grids .............................................................................................................. 9
4.0 Research ............................................................................................................................. 10
   4.1 Primary Research ........................................................................................................... 10
   4.2 Primary Research Findings ............................................................................................. 10
4.2 Secondary Research ........................................................................................................... 14
   4.2.1The UK Grocery Market ............................................................................................... 14
   4.2.2. Lidl .............................................................................................................................. 14
4.3 Social and Cultural Issues ................................................................................................... 15
   4.3.1Recession ..................................................................................................................... 15
   4.4 Research Implications .................................................................................................... 16
5.0 Recommended Brand Model ............................................................................................. 17
       Figure 5.1 Recommended Brand Model .......................................................................... 17
6.0 New Mood Board ............................................................................................................... 18
       Figure 6.1 Proposed Brand Model ................................................................................... 18
7.0 Brand Personality and Tone of Voice ................................................................................. 20
8.0 Expression of new Idea ...................................................................................................... 21
   8.1 Logo and tag line ............................................................................................................ 21
   8.2 Brand Touchpoints ......................................................................................................... 22
       Figure 8.2.1 ...................................................................................................................... 23
9.0 Recommended measurements of outcome ...................................................................... 25
References ............................................................................................................................... 26




Appendices............................................................................................................................... 29
   Appendix 1 ........................................................................................................................... 29
   Appendix 1.1- Questionnaire- Question 1 ........................................................................... 29
   Appendix 1.2- Questionnaire- Question 2 ........................................................................... 29
   Appendix 1.3- Questionnaire- Question 3 ........................................................................... 29
   Appendix 1.4- Questionnaire- Question 4 ........................................................................... 30
   Appendix 1.5- Questionnaire- Question 5 ........................................................................... 30
   Appendix 1.6- Questionnaire- Question 6 ........................................................................... 30
   Appendix 1.7- Questionnaire- Question 7 ........................................................................... 30
   Appendix 1.8- Questionnaire- Question 8 ........................................................................... 30
   Appendix 1.9- Questionnaire- Question 9 ........................................................................... 30
   Appendix 1.10- Questionnaire- Question 10 ....................................................................... 31
   Appendix 2- Focus Group images ........................................................................................ 31
   Appendix 3- Lidl Advert ........................................................................................................ 33
   Appendix 4- Loyalty Card ..................................................................................................... 33
1.0 Introduction

Lidl is a German discount supermarket; operating a chain of over 7000 stores across Europe.
In Germany Lidl has an upmarket image attracting middle class professionals (Matamalas
and Ramos, 2009). Despite the fact that in the UK Lidl products have been rated as better
quality than big name brands (Pearl, 2008), UK consumers perceive Lidl to be a European
and down market retailer attracting low income families (Matamalas and Ramos, 2009).
However whilst the recession has brought a number of middle class consumers to Lidl and
created a sharp increase in profits, analysts are uncertain as to whether Lidl’s no frills
branding and strategy in the United Kingdom will be able to maintain levels of profitability in
a strong economy (Blythman, 2008) as customers may seek an experience which goes
beyond products and pricing.

1.1Company Background

Schwarz Beteiligungs GmbH is the holding company of the Handelshof and Kaufland store
chains and Lidl Stiftung & Co KG, a wholly-owned subsidiary which owns supermarket Lidl.
The company was founded in Germany in the 1930’s by the Schwartz family as a wholesale
foods company under the name Schwarz Assorted Wholesale Foods. The first Lidl stored
opened in 1973 and by 1977 the Lidl chain comprised 33 discount stores. Today Lidl
operates 7,200 stores across 20 European countries. Within the UK, Lidl has a national
distribution network servicing its 536 stores across the country. Whilst Lidl remains
concentrated to grocery retailing, it has made attempts to diversify its offering by launching
Lidl movies, a low cost movie rental company, however due to lack of demand the company
now ceases to exist. Lidl’s history within the UK has changed dramatically in recent years
following the appointment of three different managing directors within only two years. This
highlights the difficulties the company faces in order to maintain strong sales (Euromonitor
International, 2011).




                                              1
Lidl Movies –
                                                          online    DVD
 Company                                                  rental.
 founded     in                                         MD        Marcel
 Germany under                 Lidl opened              Oosterwijk
                               first store in           steps     down.              Present
 the      name
                               UK.                      New MD Frank-                Day
 Schwarz
 Assorted                                               Michael Mros.
 Wholesale 1973
   1930’s                      1994          2008          2009         2010           20
 Foods .                                                                               12



                Lidl                      Lidl Express        –    Frank- Michael
                opened                    Edmonton.                Mros steps down
                its first                                          – New MD Ronny
                store in                                           Gottschlich (Sept
                Germany                                            2010).
Figure 1.0 Lidl Timeline
                .


1.2 Organisational Strategy
Lidl’s no frills approach to retailing enables them to eliminate all extra costs such as carrier
bags and customer services. The in-store design reflects this approach, Lidl avoids expensive
flooring, furnishing, or embellishments associated with most grocery stores and uses basic
fixtures such as pallets, wire bins and simple shelving (ICMR 2010). Lidl do this in order to
keep their operating costs as low as possible which allows them to maintain low product
prices and offer their customers value for money. Lidl also have a narrow product
assortment, offering one or two items in each category. Therefore Lidl is able to buy large
amounts of stock achieving economies of scale, enabling Lidl to offer quality products at a
low competitive price.




                                                2
2.0 Existing Brand Architecture and Strategy
2.1 Existing brand Architecture
Lidl is seen to hold a house of brands strategy (Aaker & Joachimsthaler 2000). Lidl stocks
very few market leading brands and mainly stocks their own unfamiliar captive brands,
which encompasses food and non-food products. Many ranges focus on the ethnic origin of
products. Its Italian brand Combino covers everything from dry pasta and frozen tortelloni
to pasta sauces; Eridanous covers all products Greek; El Tequito signals Mexican food;
Vitasia carries a complement of Asian food products; while Trattoria Alfredo is Lidl’s pizza
line. In its non-grocery arm, brand Silvercrest focuses on electrical products. Lidl also offer a
fair trade brand, Free Globe, which provides Lidl consumers with an ethical alternative.
Captive brands are in line with Lidl’s operating strategy as a no frills discount retailer. Own
label, captive brands are cheaper than branded label products as Lidl control the costs and
production thereby ensuring higher profit margins.

2.2 Existing Brand Strategy
The brand model in figure 2.3 highlights Lidl’s current brand strategy of offering quality
produce at a low price. This identity however is not necessarily translated to UK consumers
brand image of Lidl, which is mainly focussed around low costs and cheapness as opposed to
good quality food.




                                               3
Fi
gure 2.3 – Existing Brand Model




                                  4
Figure 2.4 Current Mood Board




The mood board highlights Lidl’s brand image as a cheap, low cost, cluttered discount retailer, which
is shown in its advertising, products, store design, logo, colour scheme and tagline.
                                                   5
3.0 Positioning
3.1 Competitor Analysis

Figure 3.2 UK Grocery Market share January 2012.




                                      6
7
Figure 3.3 Lidl’s competitor Analysis




                                        8
3.4 Positioning Grids
Lidl’s currently differentiate themselves in the market by offering quality products at a low
price. Therefore the dimensions of quality and price can be used to segment the UK grocery
market. Despite the numerous awards for the quality of products, Lidl is perceived as being
low quality and low price by consumers. If Lidl were rebranded on these dimensions, the
image of quality could be enhanced.




After the initial positioning grids that focused on quality and price, from research it was
recognised that it was beneficial to focus on more market trends such as freshness. Whilst
during the current recession consumers focus may be on price, post-recession may
demonstrate a change in focus, emphasising more quality and freshness. Therefore the
following positioning grid displays this.




                                             9
4.0 Research
4.1 Primary Research

An online survey was distributed to 106 participants; aiming to establish current perceptions
towards the Lidl brand and discovering what consumers look for in a supermarket.



4.2 Primary Research Findings




This graph demonstrates that Lidl is rated one of the lowest in terms of fresh, organic, staff,
loyalty and product availability. It is rated as average in terms of being ethical compared
with its competitors and was rated quite high in terms of price (value for money). However
it wasn’t rated as top four based on any of the aspects (see Appendix 1.1).

Other findings:

       The most important factors in determining supermarket choice, as shown in rank
       order are; price, quality of produce, freshness of produce, availability of
       produce/brands, supermarket brands, in store convenience, location, ethical position
       and staff (see Appendix 1.2).


       The survey found that 93% of participant’s supermarket brand preferences have not
       changed as a result of the recession (see Appendix 1.3).


       Consumers also favorably rated supermarket private labels rating them with an


                                              10
average of 4.1 out of 5 (see Appendix 1.4).


Consumers surveyed also stated that on an average weekly shop consumers
purchased 53% private label brands versus 47% marketing leading brands (see
Appendix 1.5).


The survey also asked participants what colours they positively associate with
supermarkets (see Appendix 1.6).




47.5% of participants had never even been Lidl. Therefore participant’s views have
been divided into users and non-users (see Appendix 1.7).


The chart below illustrates the Lidl user and non-user’s perceptions of the Lidl brand
in terms of positive and negative aspects.The majority of Lidl users infrequently
shopped at Lidl (see Appendix 1.8) and 89% additionally used other grocery stores.




                                      11
12
The current Lidl logo received a rating of 2.76 out of 5 (see Appendix 1.9). When asked
about their views on the logo, participants believed that the colours and image present
were not associated with a supermarket (see Appendix 1.10). Participants said:


                         “Makes the company look like a bad Ikea.”
                                        “Uninspiring”
       “The colours and image remind me of a hardware store and not a food store”.



Primary research – Proposed new mood board images, colours and logo
Further research was later conducted using focus groups to explore opinions and views of
the images, colours and logo used in the proposed mood board (See Appendix 2).


The new logo received a rating of 4.64 out of 5.


Word association was used to explore such opinions and views of the participants. Three
themes emerged from this:


       Appearance                        Quality                         Green
          Fresh                         Up-market                       Organic
        Friendly                       Professional                      Ethical
        Modern                                                            Local
    Organised – layout                                               Environmental
          Clean                                                         Healthy
          Open                                                         Fait trade
        Cohesive                                                         Fresh
       Welcoming




                                             13
4.2 Secondary Research
4.2.1The UK Grocery Market
      Research into supermarket preferences in the UK reveals that freshness of produce
      is rated the highest across four consumer groups (elderly, wealthy, ethnic and lone
      parents). Price was recognised as second, with quality, range and access as other key
      factors (I.R.I., 2007).

      Datamonitor (2009) points out that whilst low prices are a big influence on where UK
      consumers shop, the primary influence was the overall quality of the products sold.

      Datamonitor (2009) also points out that private label brands are currently
      performing very well. Only 15% of consumers stated that they rarely or never bought
      private label brands. Whilst 39% said that they were regular uses of private label
      brands with some believing that they were actually superior to market leading
      brands.

4.2.2. Lidl
      Consumer magazine ‘Which?’ reports that Lidl consumer satisfaction scores are
      considerably higher than the big four supermarkets. Therefore Lidl’s current users,
      which represent only 2.6% of the UK grocery market, appear to be very pleased with
      Lidl’s operations (Wallop, 2010).

      The vast majority of UK consumers however do not share this image and have a very
      negative impression of the brand; “Strip lights glare down on a narrow range of
      products in ugly packaging, displayed in cardboard boxes piled on the floor and on
      low shelves” (The Economist 2008).


      Lidl has received widespread negative PR in the press regarding the poor treatment
      of workers (Connolly, 2008). Such damming reports have further damaged Lidl’s
      brand image.




                                           14
Such impressions have led to Lidl being rated as one of the most hated brands in the
       UK (Schroeder, Salzer-Mörling and Askegaard, 2006).

       Residents of towns have become outraged by the prospect of a Lidl store opening,
       believing that it will lower the tone of the area and destroy its character (Poulter,
       2010).


       According to Laforet (2010) a logo should signal allegiance to the brand it represents.
       The current Lidl logo is not representative of a grocery outlet. The main colour used
       in Lidl’s logo is blue. Research has found that blue slows metabolism and is an
       appetite suppressant (AstroNutrition, 2010). Such colours therefore are not ideal for
       a grocery brand. The colour orange however has been found to stimulate appetite
       and the mind. The colour green is also associated with food and healthy living.


4.3 Social and Cultural Issues

4.3.1Recession


The financial recession is having a massive impact on grocery shopping in the UK. Research
reveals that discount retailers such as Lidl and high end retailer Waitrose were massively out
performing mid-market rivals (Wood, 2011). Research points out that Lidl is gaining a more
diverse, middle class customer base as a result of the recession (Blythman, 2008). However
Charles (2010) points out that as the recession has eased Lidl’s market share has slowly
decreased for the first time since 2004. The Lidl brand therefore needs to be able to
compete on more than just price if it is to be sustainable and retain more affluent
consumers in the future.


4.3.3. Ethical Consumption
Statistics’ show that ethical consumption is increasing (McEachern and Berry, 2005).
Research has revealed that the ethical food and drinks market saw an increase of 17% alone
in 2006. In 2006 sales of free range eggs overtook the sales of non free range eggs
(Cooperative Bank, 2007). It is also reported that 13% of adults in the UK purchased more


                                             15
regionally produced items. Ethical, fair-trade and local food consumption is therefore
becoming increasingly important to UK consumers. Interestingly Lidl does currently sell free-
trade products (Lidl, 2012), however the current branding does not communicate this idea
to the customer.



4.4 Research Implications
The current low cost and discount strategy of Lidl has resulted in a poor brand image. In
order to ensure future success Lidl need to diversify from the current low cost approach and
focus not solely on price but on contemporary grocery market trends. The research reveals
that more people are seeking fresh, healthy and ethically sourced food, which is easily
available. Therefore in order to overcome the current poor brand image and differentiate
themselves in the current competitive grocery market; it is proposed that Lidl radically
transform their brand and adopt a fresh and invigorating brand image which is focused
around delivering fresh, ethically sourced food to local communities.




                                             16
5.0 Recommended Brand Model
The recommended brand model takes into account the research findings and reflects and
justifies the new brand values. The core brand essence moves from; low price and quality
products to; natural, fresh, organic and quality (figure 5.1). This will be communicated
through our company values, originally geared towards Lidl being traditional, European and
holding a no frills approach; it becomes; more ethical, innovative, trustworthy and
contemporary. The product values move from; foreign, discount, captive brands and cheap
to identifiable and symbolic private label brands, quality and locally sourced.




Figure 5.1 Recommended Brand Model




                                              17
6.0 New Mood Board




Figure 6.1 Proposed Brand Model


The new mood board represents the ideas that are demonstrated by the recommended
brand model. It reflects a fresh and organic range of food, with a market place layout to



                                           18
reflect a family/community feel to the store. All the brands are now recognisable, labelled
as Lidl’s own brands.




                                            19
7.0 Brand Personality and Tone of Voice


Lidl’s personality is not distinct from their competitor’s offerings. Lidl’s brand personality
reflects an; outdated, cheap, European, cluttered product range, which is negatively
perceived by some consumers. Within the UK, Lidl’s personality and captive branded
products lack symbolic meaning and have few strong associations with Lidl. Lidl currently
portray a muted tone of voice. It is recommended that the new tone of voice, in order to
match the new brand ideas, is fresh and natural. It should portray Lidl as honest and
trustworthy, offering; quality, fresh and organic products at a competitive price. It should
also aim to show that Lidl is natural as opposed to cheap and basic.




                                             20
8.0 Expression of new Idea
8.1 Logo and tag line

In order to overcome the negative perceptions associated with the current logo and
represent a true and radical break with the previous brand image, a new logo has been
designed to represent Lidl’s new and fresh proposed brand image and positioning. Green
represents freshness, ethical and positive brand image. This is complemented with an
orange trademark to create a symbolic identity. The simplicity of the logo depicts a more
sophisticated and positive image to appeal to a wider consumer base.




The tag line ‘Simply, Fresh, Delicious’ is designed to portray the proposed Lidl brand clearly
to the consumer and adds to the brand personality. The three words together create a
memorable connection with the consumer.




                                             21
8.2 Brand Touchpoints




Pre purchase experience
      Marketing communications will be used to portray the proposed brand identity to
      the customers. Advertisements both online and offline in press and on television will
      be used to appeal to a wide audience (see Appendix 3). Adverts will depict the
      proposed fresh, ethical and invigorating brand by showing affluent consumers
      purchasing aesthetically pleasing food.


      Social media such as blogs, Twitter and Facebook will also be used to communicate
      the proposed brand to consumers. Not only will this help to advertise the new brand
      values it will also help to establish the community element of the brand online.


      Additionally the website shall enable the new brand idea to be demonstrated to
      current and potential customers. Its focus will be on expressing the core values of
      the new brand, fresh, ethical and local. Internet shopping will also help to enhance
      the brand image by appearing more convenient and accessible.


                                            22
Purchase Experience
      The main touch point in portraying the proposed Lidl brand is the retail environment.
      Primary research highlights the importance of store design and layout in
      supermarket preferences. Both the external and internal store design should be
      upgraded to reflect the proposed, fresh and invigorating brand identity. The current
      smaller size of Lidl stores is in keeping with Lidl’s new brand image as a fresh, ethical
      retailer. The store interior however should portray a more natural, open and cleaner
      image whist displaying the produce in attractive and effective manner, which is
      functional for consumers to use. Figures 8.2.1 & 8.2.2 show a proposed design,
      which has a very fresh and organic atmosphere, where consumers can experience
      the new brand identity.




Figure 8.2.1                                          Figure 8.2.2


      It is proposed that the majority of Lidl’s products will remain of the same award
      winning quality; however any products which are unethical or not perceived as fresh
      will be removed from the product offering. The products sold at Lidl will no longer be
      unknown, ambiguous captive brands. The research reveals a strong consumer
      preference for own label retail brands. Not only do such brands provide Lidl with
      high profit margins they will also help to enhance the brand and ensure more
      recognisability and trust within the product offering. Such products will also be
      packaged in a cohesive manner, which portrays the fresh, invigorating and ethical
      image of the brand.




                                             23
Post purchase experience
      In order to promote a corporate social responsibility and reinforce Lidl’s proposed
      ethical positioning, it is suggested that Lidl forms an alliance with an ethical and fair
      trade organisation in order to gain recognition for its efforts and reinforce this idea
      to the consumer.


      The loyalty scheme will be used to retain customers. It will also enable Lidl to assess
      customer behaviours, finding trends and patterns. This would enable Lidl to examine
      the success of the new brand idea whilst addressing any necessary alterations (see
      Appendix 4).




                                             24
9.0 Recommended measurements of outcome

    Lidl are currently one of the most hated brands in the UK, a focus group and
    questionnaires would be undertaken to measure consumer’s new attitudes towards
    the brand. In contrast we expect to measure a greater positive attitude expressing
    love and excitement towards the brand.
    In particular the Initial question (Appendix 1.1) could be repeated to assess whether
    these proposed changes for example; focus on freshness of products rather than low
    price had a positive effect on Lidl overall. This would be measured by comparing the
    previous results for this question with the new findings.
    The loyalty scheme will also assess the retention rate of consumers, additionally be
     able to assess the brand loyalty and buying behaviours of the new customers
     acquired.
    Another measurement of outcome could be to assess and improve market share
     (see figure 3.2) after rebranding and once again post recession.




                                          25
References

Aaker, D A. Joachimsthaler, E. (2000) ‘The Brand Relationship Spectrum: The Key to the
Brand Architecture Challenge’ California Management Review, Vol. 42/4, pp. 8-23.

AstroNutrition (2010). How Colours Affects Your Appetite. Available at:
http://www.astronutrition.com/blog/how_colour_affects_your_appetite. [Accessed on 26th
February 2012].

Blythman, J. (2008) The rise of Lidl Britain during the credit crunch. Available at:
http://www.telegraph.co.uk/news/features/3637902/The-rise-of-Lidl-Britain-during-the-
credit-crunch.html. [Accessed on 26th February 2012].

Centaur Media plc a (2012) ‘Asda’ Available at
http://www.marketingweek.co.uk/brands/asda/ [Accessed on 23rd March 2012].

Centaur Media plc b (2012) ‘Sainsburys’ Available at
http://www.marketingweek.co.uk/brands/sainsburys/ [Accessed on 23 rd March 2012].

Cooperative Bank (2007) Ethical Consumerism Report. Available
http://www.cooperativebank.co.uk/servlet/Satellite?c=Pageandcid=1139903089615andpag
ename=CoopBank%2FPage%2FtplPageStandard. [Accessed on 2nd March, 2012].

Co-operative Group Limited (2012) materiality and strategy Available at http://www.co-
operative.coop/corporate/Sustainability09/Overview/sustainability-
management/materiality-and-strategy/ [Accessed on 23rd March 2012].

Cowe, R. and William, S (2000), Who are the Ethical Consumers?. Ethical Consumerism
Report, Cooperative Bank (online) Available
http://www.cooperativebank.co.uk/servlet/Satellite?c=Pageandcid=1139903089615andpag
ename=CoopBank%2FPage%2FtplPageStandard. [Accessed on 20th December, 2011].

Datamonitor (2009) UK consumers: shopping for value, but reluctant to compromise on
quality. Available at:
http://www.datamonitor.com/store/News/uk_consumers_shopping_for_value_but_relucta
nt_to_compromise_on_quality?productid=E49760A1-176A-485D-A0D8-2626A134395D.
[Accessed on 4th March 2012].

Emap Ltd (2011) ‘Aldi Corporate Strategy’ Available at
http://www.racplus.com/intelligence/retailers/aldi/aldi-corporate-strategy/8601475.article
[Accessed on 23rd March 2012].

Euromonitor International (2011). Schwarz Beteiligungs GmbH - Retailing

                                            26
I.R.I (2007) Consumers’ shopping wants and UK grocery retailing. Are consumer needs being
met?. Available :
http://www.britishbrandsgroup.org.uk/upload/File/BBG%20Needs%20research%2077.pdf.
[Accessed on 1st March 2012].

ICMR (2010) ‘Lidl: The Hard Discounter Case Study 2008’ Available at
http://www.icmrindia.org/casestudies/catalogue/Business%20strategy/BSTR290.htm
[Accessed on 15th February 2012].

Laforet, S. (2010) Managing Brands. McGraw-Hill Higher Education.

Lidl (2012) Available at www.Lidl.co.uk [Accessed on 20th February 2012].

Mitchell, V.W, and Kiral, R.H (1998). Primary and Secondary store-loyal consumer
perceptions of grocery retailers, British Food Journal, 100 (7), pp. 312-319.
Pearl, J. (2011) Why I shouldn’t think twice about budget champagne. Available at:
http://conversation.which.co.uk/consumer-rights/champagne-taste-test-morrisons-lidl-
waitrose/. [Accessed on 25th February 2012].

Morrisons (2012) Available at
http://www.morrisons.co.uk/Corporate/2010/AnnualReport/strategic-review/our-strategy/
[Accessed on 23rd March 2012].

Poulter, S. (2010). We're too posh for Lidl: Cut-price superstore will lower the tone, say the
people of Lytham. Available at http://www.dailymail.co.uk/news/article-1314616/Were-
posh-Lidl-Cut-price-superstore-lower-tone-say-people-Lytham.html#ixzz1sxiFoC5n.
[Accessed on 3rd March 2012].
Schroeder,J.E., Salzer-Mörling, M. and Askegaard, S. (2006). Brand Culture. Taylor & Francis.


SPAR (2012) ‘SPAR around the world’ Available at
http://www.spar.co.uk/AboutUs/CompanyInfo/SPARaroundtheworld.aspx [Accessed on
23rd March 2012].

Tesco PLC (2012) Available at http://www.tescoplc.com/about-tesco/our-strategy/
[Accessed on 23rd March 2012].


The Economist (2008). The Germans are coming. Germany’s “hard discount” model of
supermarket retailing is spreading in Europe. Available at: http://
www.economist.com/node/11920665. [Accessed on 2nd March 2012].

Waitrose (2012) Available at
http://www.waitrose.com/content/waitrose/en/home/about_waitrose/our_company/the_
waitrose_difference.html [Accessed on 23rd March 2012].




                                             27
Wallop, H. (2010) Aldi and Lidl beat Tesco and Sainsbury's in Which? Survey. Avaliable at:
http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/7083273/Aldi-and-
Lidl-beat-Tesco-and-Sainsburys-in-Which-survey.html. [Accessed on 23rd Febuary 2012].

Wood, Z (2011) Waitrose or Lidl? Shoppers in a divided Britain compare supermarkets deals.
Available at http://www.guardian.co.uk/uk/2011/jun/29/waitrose-lidl-shopper-divided-
britain. [Accessed on 2nd March 2011].




                                            28
Appendices
           Appendix 1
           Appendix 1.1- Questionnaire- Question 1

           Please rank the following supermarkets in order of preference on the following factors. 1
           being the least preferred and 12 being the most preferred.

                Iceland   Farmfoods   Lidl   Spar   Aldi   Asda       Tesco   M&S   Sainsburys       Co-   Morrissons   Waitrose
                                                                                                     op
Freshness of
produce
Loyalty
Organic
Staff
Product
availability
Price
Ethics



           Appendix 1.2- Questionnaire- Question 2


           Please rate out of 5 the importance of the following factors in determining your supermarket
           choice. 1 being of the least importance and 5 being of the most importance.

                                  1             2                 3             4                5
           Quality of produce
           Freshness of produce
           Price
           Location
           Ethical position
           Staff
           In store convenience
           Availability of
           produce/brands
           Supermarket brand




           Appendix 1.3- Questionnaire- Question 3
           Has your supermarket brand preferences changed within the recession?



                                                             29
Appendix 1.4- Questionnaire- Question 4
On a scale of 1 to 5 how do you rate supermarket own label brands. 5 being the highest and 1
being the lowest.

Appendix 1.5- Questionnaire- Question 5

What Percentage of supermarket own label products do you buy versus market leading
brands? Own label brands Market leading brands



Appendix 1.6- Questionnaire- Question 6

Which colours do you positively associate with supermarkets?

Blue             Red               Green            Yellow            Purple

Orange           Pink              Black            Brown



Appendix 1.7- Questionnaire- Question 7
Have you been to Lidl?
If YES what did you like and dislike about Lidl
If NO why have you not been and what do you think are the positive aspects and negative
aspects of shopping at Lidl?




Appendix 1.8- Questionnaire- Question 8
Lidl Users: How often do you go to Lidl?
Very Rarely Rarely Sometimes Frequently             Very Frequently



Appendix 1.9- Questionnaire- Question 9
In terms of colours used, style and design what do you think of the Lidl logo (Please see
below)?
Please indicate your answer using the scale below, with 1 being the low and 5 being high.




                                             30
Appendix 1.10- Questionnaire- Question 10

Please explain why you gave the Lidl logo that particular rating.

Appendix 2- Focus Group images




                                              31
32
Appendix 3- Lidl Advert




Appendix 4- Loyalty Card




                           33

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Fresh Brand Strategy for UK Discounter Lidl

  • 2. Executive Summary The UK grocery market is extremely competitive. With the demand of food products being regularly affected by cross price elasticity; retailers must ensure that they are constantly exploring new and innovative methods to achieve a differential advantage over competitors (Mitchell and Kiral, 1998). This report will assess the current brand strategy of discount grocery retailer Lidl and provides recommendations on how Lidl can improve and differentiate their brand by adopting a fresh and invigorating brand image.
  • 3. Contents 1.0 Introduction ......................................................................................................................... 1 1.1Company Background ....................................................................................................... 1 Figure 1.0 Lidl Timeline ...................................................................................................... 2 1.2 Organisational Strategy.................................................................................................... 2 2.0 Existing Brand Architecture and Strategy ............................................................................ 3 2.1 Existing brand Architecture ............................................................................................. 3 2.2 Existing Brand Strategy .................................................................................................... 3 Figure 2.4 Current Mood Board ......................................................................................... 5 3.0 Positioning............................................................................................................................ 6 3.1 Competitor Analysis ......................................................................................................... 6 Figure 3.2 UK Grocery Market share January 2012. .......................................................... 6 Figure 3.3 Lidl’s competitor Analysis ................................................................................. 8 3.4 Positioning Grids .............................................................................................................. 9 4.0 Research ............................................................................................................................. 10 4.1 Primary Research ........................................................................................................... 10 4.2 Primary Research Findings ............................................................................................. 10 4.2 Secondary Research ........................................................................................................... 14 4.2.1The UK Grocery Market ............................................................................................... 14 4.2.2. Lidl .............................................................................................................................. 14 4.3 Social and Cultural Issues ................................................................................................... 15 4.3.1Recession ..................................................................................................................... 15 4.4 Research Implications .................................................................................................... 16 5.0 Recommended Brand Model ............................................................................................. 17 Figure 5.1 Recommended Brand Model .......................................................................... 17 6.0 New Mood Board ............................................................................................................... 18 Figure 6.1 Proposed Brand Model ................................................................................... 18 7.0 Brand Personality and Tone of Voice ................................................................................. 20 8.0 Expression of new Idea ...................................................................................................... 21 8.1 Logo and tag line ............................................................................................................ 21 8.2 Brand Touchpoints ......................................................................................................... 22 Figure 8.2.1 ...................................................................................................................... 23 9.0 Recommended measurements of outcome ...................................................................... 25
  • 4. References ............................................................................................................................... 26 Appendices............................................................................................................................... 29 Appendix 1 ........................................................................................................................... 29 Appendix 1.1- Questionnaire- Question 1 ........................................................................... 29 Appendix 1.2- Questionnaire- Question 2 ........................................................................... 29 Appendix 1.3- Questionnaire- Question 3 ........................................................................... 29 Appendix 1.4- Questionnaire- Question 4 ........................................................................... 30 Appendix 1.5- Questionnaire- Question 5 ........................................................................... 30 Appendix 1.6- Questionnaire- Question 6 ........................................................................... 30 Appendix 1.7- Questionnaire- Question 7 ........................................................................... 30 Appendix 1.8- Questionnaire- Question 8 ........................................................................... 30 Appendix 1.9- Questionnaire- Question 9 ........................................................................... 30 Appendix 1.10- Questionnaire- Question 10 ....................................................................... 31 Appendix 2- Focus Group images ........................................................................................ 31 Appendix 3- Lidl Advert ........................................................................................................ 33 Appendix 4- Loyalty Card ..................................................................................................... 33
  • 5. 1.0 Introduction Lidl is a German discount supermarket; operating a chain of over 7000 stores across Europe. In Germany Lidl has an upmarket image attracting middle class professionals (Matamalas and Ramos, 2009). Despite the fact that in the UK Lidl products have been rated as better quality than big name brands (Pearl, 2008), UK consumers perceive Lidl to be a European and down market retailer attracting low income families (Matamalas and Ramos, 2009). However whilst the recession has brought a number of middle class consumers to Lidl and created a sharp increase in profits, analysts are uncertain as to whether Lidl’s no frills branding and strategy in the United Kingdom will be able to maintain levels of profitability in a strong economy (Blythman, 2008) as customers may seek an experience which goes beyond products and pricing. 1.1Company Background Schwarz Beteiligungs GmbH is the holding company of the Handelshof and Kaufland store chains and Lidl Stiftung & Co KG, a wholly-owned subsidiary which owns supermarket Lidl. The company was founded in Germany in the 1930’s by the Schwartz family as a wholesale foods company under the name Schwarz Assorted Wholesale Foods. The first Lidl stored opened in 1973 and by 1977 the Lidl chain comprised 33 discount stores. Today Lidl operates 7,200 stores across 20 European countries. Within the UK, Lidl has a national distribution network servicing its 536 stores across the country. Whilst Lidl remains concentrated to grocery retailing, it has made attempts to diversify its offering by launching Lidl movies, a low cost movie rental company, however due to lack of demand the company now ceases to exist. Lidl’s history within the UK has changed dramatically in recent years following the appointment of three different managing directors within only two years. This highlights the difficulties the company faces in order to maintain strong sales (Euromonitor International, 2011). 1
  • 6. Lidl Movies – online DVD Company rental. founded in MD Marcel Germany under Lidl opened Oosterwijk first store in steps down. Present the name UK. New MD Frank- Day Schwarz Assorted Michael Mros. Wholesale 1973 1930’s 1994 2008 2009 2010 20 Foods . 12 Lidl Lidl Express – Frank- Michael opened Edmonton. Mros steps down its first – New MD Ronny store in Gottschlich (Sept Germany 2010). Figure 1.0 Lidl Timeline . 1.2 Organisational Strategy Lidl’s no frills approach to retailing enables them to eliminate all extra costs such as carrier bags and customer services. The in-store design reflects this approach, Lidl avoids expensive flooring, furnishing, or embellishments associated with most grocery stores and uses basic fixtures such as pallets, wire bins and simple shelving (ICMR 2010). Lidl do this in order to keep their operating costs as low as possible which allows them to maintain low product prices and offer their customers value for money. Lidl also have a narrow product assortment, offering one or two items in each category. Therefore Lidl is able to buy large amounts of stock achieving economies of scale, enabling Lidl to offer quality products at a low competitive price. 2
  • 7. 2.0 Existing Brand Architecture and Strategy 2.1 Existing brand Architecture Lidl is seen to hold a house of brands strategy (Aaker & Joachimsthaler 2000). Lidl stocks very few market leading brands and mainly stocks their own unfamiliar captive brands, which encompasses food and non-food products. Many ranges focus on the ethnic origin of products. Its Italian brand Combino covers everything from dry pasta and frozen tortelloni to pasta sauces; Eridanous covers all products Greek; El Tequito signals Mexican food; Vitasia carries a complement of Asian food products; while Trattoria Alfredo is Lidl’s pizza line. In its non-grocery arm, brand Silvercrest focuses on electrical products. Lidl also offer a fair trade brand, Free Globe, which provides Lidl consumers with an ethical alternative. Captive brands are in line with Lidl’s operating strategy as a no frills discount retailer. Own label, captive brands are cheaper than branded label products as Lidl control the costs and production thereby ensuring higher profit margins. 2.2 Existing Brand Strategy The brand model in figure 2.3 highlights Lidl’s current brand strategy of offering quality produce at a low price. This identity however is not necessarily translated to UK consumers brand image of Lidl, which is mainly focussed around low costs and cheapness as opposed to good quality food. 3
  • 8. Fi gure 2.3 – Existing Brand Model 4
  • 9. Figure 2.4 Current Mood Board The mood board highlights Lidl’s brand image as a cheap, low cost, cluttered discount retailer, which is shown in its advertising, products, store design, logo, colour scheme and tagline. 5
  • 10. 3.0 Positioning 3.1 Competitor Analysis Figure 3.2 UK Grocery Market share January 2012. 6
  • 11. 7
  • 12. Figure 3.3 Lidl’s competitor Analysis 8
  • 13. 3.4 Positioning Grids Lidl’s currently differentiate themselves in the market by offering quality products at a low price. Therefore the dimensions of quality and price can be used to segment the UK grocery market. Despite the numerous awards for the quality of products, Lidl is perceived as being low quality and low price by consumers. If Lidl were rebranded on these dimensions, the image of quality could be enhanced. After the initial positioning grids that focused on quality and price, from research it was recognised that it was beneficial to focus on more market trends such as freshness. Whilst during the current recession consumers focus may be on price, post-recession may demonstrate a change in focus, emphasising more quality and freshness. Therefore the following positioning grid displays this. 9
  • 14. 4.0 Research 4.1 Primary Research An online survey was distributed to 106 participants; aiming to establish current perceptions towards the Lidl brand and discovering what consumers look for in a supermarket. 4.2 Primary Research Findings This graph demonstrates that Lidl is rated one of the lowest in terms of fresh, organic, staff, loyalty and product availability. It is rated as average in terms of being ethical compared with its competitors and was rated quite high in terms of price (value for money). However it wasn’t rated as top four based on any of the aspects (see Appendix 1.1). Other findings: The most important factors in determining supermarket choice, as shown in rank order are; price, quality of produce, freshness of produce, availability of produce/brands, supermarket brands, in store convenience, location, ethical position and staff (see Appendix 1.2). The survey found that 93% of participant’s supermarket brand preferences have not changed as a result of the recession (see Appendix 1.3). Consumers also favorably rated supermarket private labels rating them with an 10
  • 15. average of 4.1 out of 5 (see Appendix 1.4). Consumers surveyed also stated that on an average weekly shop consumers purchased 53% private label brands versus 47% marketing leading brands (see Appendix 1.5). The survey also asked participants what colours they positively associate with supermarkets (see Appendix 1.6). 47.5% of participants had never even been Lidl. Therefore participant’s views have been divided into users and non-users (see Appendix 1.7). The chart below illustrates the Lidl user and non-user’s perceptions of the Lidl brand in terms of positive and negative aspects.The majority of Lidl users infrequently shopped at Lidl (see Appendix 1.8) and 89% additionally used other grocery stores. 11
  • 16. 12
  • 17. The current Lidl logo received a rating of 2.76 out of 5 (see Appendix 1.9). When asked about their views on the logo, participants believed that the colours and image present were not associated with a supermarket (see Appendix 1.10). Participants said: “Makes the company look like a bad Ikea.” “Uninspiring” “The colours and image remind me of a hardware store and not a food store”. Primary research – Proposed new mood board images, colours and logo Further research was later conducted using focus groups to explore opinions and views of the images, colours and logo used in the proposed mood board (See Appendix 2). The new logo received a rating of 4.64 out of 5. Word association was used to explore such opinions and views of the participants. Three themes emerged from this: Appearance Quality Green Fresh Up-market Organic Friendly Professional Ethical Modern Local Organised – layout Environmental Clean Healthy Open Fait trade Cohesive Fresh Welcoming 13
  • 18. 4.2 Secondary Research 4.2.1The UK Grocery Market Research into supermarket preferences in the UK reveals that freshness of produce is rated the highest across four consumer groups (elderly, wealthy, ethnic and lone parents). Price was recognised as second, with quality, range and access as other key factors (I.R.I., 2007). Datamonitor (2009) points out that whilst low prices are a big influence on where UK consumers shop, the primary influence was the overall quality of the products sold. Datamonitor (2009) also points out that private label brands are currently performing very well. Only 15% of consumers stated that they rarely or never bought private label brands. Whilst 39% said that they were regular uses of private label brands with some believing that they were actually superior to market leading brands. 4.2.2. Lidl Consumer magazine ‘Which?’ reports that Lidl consumer satisfaction scores are considerably higher than the big four supermarkets. Therefore Lidl’s current users, which represent only 2.6% of the UK grocery market, appear to be very pleased with Lidl’s operations (Wallop, 2010). The vast majority of UK consumers however do not share this image and have a very negative impression of the brand; “Strip lights glare down on a narrow range of products in ugly packaging, displayed in cardboard boxes piled on the floor and on low shelves” (The Economist 2008). Lidl has received widespread negative PR in the press regarding the poor treatment of workers (Connolly, 2008). Such damming reports have further damaged Lidl’s brand image. 14
  • 19. Such impressions have led to Lidl being rated as one of the most hated brands in the UK (Schroeder, Salzer-Mörling and Askegaard, 2006). Residents of towns have become outraged by the prospect of a Lidl store opening, believing that it will lower the tone of the area and destroy its character (Poulter, 2010). According to Laforet (2010) a logo should signal allegiance to the brand it represents. The current Lidl logo is not representative of a grocery outlet. The main colour used in Lidl’s logo is blue. Research has found that blue slows metabolism and is an appetite suppressant (AstroNutrition, 2010). Such colours therefore are not ideal for a grocery brand. The colour orange however has been found to stimulate appetite and the mind. The colour green is also associated with food and healthy living. 4.3 Social and Cultural Issues 4.3.1Recession The financial recession is having a massive impact on grocery shopping in the UK. Research reveals that discount retailers such as Lidl and high end retailer Waitrose were massively out performing mid-market rivals (Wood, 2011). Research points out that Lidl is gaining a more diverse, middle class customer base as a result of the recession (Blythman, 2008). However Charles (2010) points out that as the recession has eased Lidl’s market share has slowly decreased for the first time since 2004. The Lidl brand therefore needs to be able to compete on more than just price if it is to be sustainable and retain more affluent consumers in the future. 4.3.3. Ethical Consumption Statistics’ show that ethical consumption is increasing (McEachern and Berry, 2005). Research has revealed that the ethical food and drinks market saw an increase of 17% alone in 2006. In 2006 sales of free range eggs overtook the sales of non free range eggs (Cooperative Bank, 2007). It is also reported that 13% of adults in the UK purchased more 15
  • 20. regionally produced items. Ethical, fair-trade and local food consumption is therefore becoming increasingly important to UK consumers. Interestingly Lidl does currently sell free- trade products (Lidl, 2012), however the current branding does not communicate this idea to the customer. 4.4 Research Implications The current low cost and discount strategy of Lidl has resulted in a poor brand image. In order to ensure future success Lidl need to diversify from the current low cost approach and focus not solely on price but on contemporary grocery market trends. The research reveals that more people are seeking fresh, healthy and ethically sourced food, which is easily available. Therefore in order to overcome the current poor brand image and differentiate themselves in the current competitive grocery market; it is proposed that Lidl radically transform their brand and adopt a fresh and invigorating brand image which is focused around delivering fresh, ethically sourced food to local communities. 16
  • 21. 5.0 Recommended Brand Model The recommended brand model takes into account the research findings and reflects and justifies the new brand values. The core brand essence moves from; low price and quality products to; natural, fresh, organic and quality (figure 5.1). This will be communicated through our company values, originally geared towards Lidl being traditional, European and holding a no frills approach; it becomes; more ethical, innovative, trustworthy and contemporary. The product values move from; foreign, discount, captive brands and cheap to identifiable and symbolic private label brands, quality and locally sourced. Figure 5.1 Recommended Brand Model 17
  • 22. 6.0 New Mood Board Figure 6.1 Proposed Brand Model The new mood board represents the ideas that are demonstrated by the recommended brand model. It reflects a fresh and organic range of food, with a market place layout to 18
  • 23. reflect a family/community feel to the store. All the brands are now recognisable, labelled as Lidl’s own brands. 19
  • 24. 7.0 Brand Personality and Tone of Voice Lidl’s personality is not distinct from their competitor’s offerings. Lidl’s brand personality reflects an; outdated, cheap, European, cluttered product range, which is negatively perceived by some consumers. Within the UK, Lidl’s personality and captive branded products lack symbolic meaning and have few strong associations with Lidl. Lidl currently portray a muted tone of voice. It is recommended that the new tone of voice, in order to match the new brand ideas, is fresh and natural. It should portray Lidl as honest and trustworthy, offering; quality, fresh and organic products at a competitive price. It should also aim to show that Lidl is natural as opposed to cheap and basic. 20
  • 25. 8.0 Expression of new Idea 8.1 Logo and tag line In order to overcome the negative perceptions associated with the current logo and represent a true and radical break with the previous brand image, a new logo has been designed to represent Lidl’s new and fresh proposed brand image and positioning. Green represents freshness, ethical and positive brand image. This is complemented with an orange trademark to create a symbolic identity. The simplicity of the logo depicts a more sophisticated and positive image to appeal to a wider consumer base. The tag line ‘Simply, Fresh, Delicious’ is designed to portray the proposed Lidl brand clearly to the consumer and adds to the brand personality. The three words together create a memorable connection with the consumer. 21
  • 26. 8.2 Brand Touchpoints Pre purchase experience Marketing communications will be used to portray the proposed brand identity to the customers. Advertisements both online and offline in press and on television will be used to appeal to a wide audience (see Appendix 3). Adverts will depict the proposed fresh, ethical and invigorating brand by showing affluent consumers purchasing aesthetically pleasing food. Social media such as blogs, Twitter and Facebook will also be used to communicate the proposed brand to consumers. Not only will this help to advertise the new brand values it will also help to establish the community element of the brand online. Additionally the website shall enable the new brand idea to be demonstrated to current and potential customers. Its focus will be on expressing the core values of the new brand, fresh, ethical and local. Internet shopping will also help to enhance the brand image by appearing more convenient and accessible. 22
  • 27. Purchase Experience The main touch point in portraying the proposed Lidl brand is the retail environment. Primary research highlights the importance of store design and layout in supermarket preferences. Both the external and internal store design should be upgraded to reflect the proposed, fresh and invigorating brand identity. The current smaller size of Lidl stores is in keeping with Lidl’s new brand image as a fresh, ethical retailer. The store interior however should portray a more natural, open and cleaner image whist displaying the produce in attractive and effective manner, which is functional for consumers to use. Figures 8.2.1 & 8.2.2 show a proposed design, which has a very fresh and organic atmosphere, where consumers can experience the new brand identity. Figure 8.2.1 Figure 8.2.2 It is proposed that the majority of Lidl’s products will remain of the same award winning quality; however any products which are unethical or not perceived as fresh will be removed from the product offering. The products sold at Lidl will no longer be unknown, ambiguous captive brands. The research reveals a strong consumer preference for own label retail brands. Not only do such brands provide Lidl with high profit margins they will also help to enhance the brand and ensure more recognisability and trust within the product offering. Such products will also be packaged in a cohesive manner, which portrays the fresh, invigorating and ethical image of the brand. 23
  • 28. Post purchase experience In order to promote a corporate social responsibility and reinforce Lidl’s proposed ethical positioning, it is suggested that Lidl forms an alliance with an ethical and fair trade organisation in order to gain recognition for its efforts and reinforce this idea to the consumer. The loyalty scheme will be used to retain customers. It will also enable Lidl to assess customer behaviours, finding trends and patterns. This would enable Lidl to examine the success of the new brand idea whilst addressing any necessary alterations (see Appendix 4). 24
  • 29. 9.0 Recommended measurements of outcome Lidl are currently one of the most hated brands in the UK, a focus group and questionnaires would be undertaken to measure consumer’s new attitudes towards the brand. In contrast we expect to measure a greater positive attitude expressing love and excitement towards the brand. In particular the Initial question (Appendix 1.1) could be repeated to assess whether these proposed changes for example; focus on freshness of products rather than low price had a positive effect on Lidl overall. This would be measured by comparing the previous results for this question with the new findings. The loyalty scheme will also assess the retention rate of consumers, additionally be able to assess the brand loyalty and buying behaviours of the new customers acquired. Another measurement of outcome could be to assess and improve market share (see figure 3.2) after rebranding and once again post recession. 25
  • 30. References Aaker, D A. Joachimsthaler, E. (2000) ‘The Brand Relationship Spectrum: The Key to the Brand Architecture Challenge’ California Management Review, Vol. 42/4, pp. 8-23. AstroNutrition (2010). How Colours Affects Your Appetite. Available at: http://www.astronutrition.com/blog/how_colour_affects_your_appetite. [Accessed on 26th February 2012]. Blythman, J. (2008) The rise of Lidl Britain during the credit crunch. Available at: http://www.telegraph.co.uk/news/features/3637902/The-rise-of-Lidl-Britain-during-the- credit-crunch.html. [Accessed on 26th February 2012]. Centaur Media plc a (2012) ‘Asda’ Available at http://www.marketingweek.co.uk/brands/asda/ [Accessed on 23rd March 2012]. Centaur Media plc b (2012) ‘Sainsburys’ Available at http://www.marketingweek.co.uk/brands/sainsburys/ [Accessed on 23 rd March 2012]. Cooperative Bank (2007) Ethical Consumerism Report. Available http://www.cooperativebank.co.uk/servlet/Satellite?c=Pageandcid=1139903089615andpag ename=CoopBank%2FPage%2FtplPageStandard. [Accessed on 2nd March, 2012]. Co-operative Group Limited (2012) materiality and strategy Available at http://www.co- operative.coop/corporate/Sustainability09/Overview/sustainability- management/materiality-and-strategy/ [Accessed on 23rd March 2012]. Cowe, R. and William, S (2000), Who are the Ethical Consumers?. Ethical Consumerism Report, Cooperative Bank (online) Available http://www.cooperativebank.co.uk/servlet/Satellite?c=Pageandcid=1139903089615andpag ename=CoopBank%2FPage%2FtplPageStandard. [Accessed on 20th December, 2011]. Datamonitor (2009) UK consumers: shopping for value, but reluctant to compromise on quality. Available at: http://www.datamonitor.com/store/News/uk_consumers_shopping_for_value_but_relucta nt_to_compromise_on_quality?productid=E49760A1-176A-485D-A0D8-2626A134395D. [Accessed on 4th March 2012]. Emap Ltd (2011) ‘Aldi Corporate Strategy’ Available at http://www.racplus.com/intelligence/retailers/aldi/aldi-corporate-strategy/8601475.article [Accessed on 23rd March 2012]. Euromonitor International (2011). Schwarz Beteiligungs GmbH - Retailing 26
  • 31. I.R.I (2007) Consumers’ shopping wants and UK grocery retailing. Are consumer needs being met?. Available : http://www.britishbrandsgroup.org.uk/upload/File/BBG%20Needs%20research%2077.pdf. [Accessed on 1st March 2012]. ICMR (2010) ‘Lidl: The Hard Discounter Case Study 2008’ Available at http://www.icmrindia.org/casestudies/catalogue/Business%20strategy/BSTR290.htm [Accessed on 15th February 2012]. Laforet, S. (2010) Managing Brands. McGraw-Hill Higher Education. Lidl (2012) Available at www.Lidl.co.uk [Accessed on 20th February 2012]. Mitchell, V.W, and Kiral, R.H (1998). Primary and Secondary store-loyal consumer perceptions of grocery retailers, British Food Journal, 100 (7), pp. 312-319. Pearl, J. (2011) Why I shouldn’t think twice about budget champagne. Available at: http://conversation.which.co.uk/consumer-rights/champagne-taste-test-morrisons-lidl- waitrose/. [Accessed on 25th February 2012]. Morrisons (2012) Available at http://www.morrisons.co.uk/Corporate/2010/AnnualReport/strategic-review/our-strategy/ [Accessed on 23rd March 2012]. Poulter, S. (2010). We're too posh for Lidl: Cut-price superstore will lower the tone, say the people of Lytham. Available at http://www.dailymail.co.uk/news/article-1314616/Were- posh-Lidl-Cut-price-superstore-lower-tone-say-people-Lytham.html#ixzz1sxiFoC5n. [Accessed on 3rd March 2012]. Schroeder,J.E., Salzer-Mörling, M. and Askegaard, S. (2006). Brand Culture. Taylor & Francis. SPAR (2012) ‘SPAR around the world’ Available at http://www.spar.co.uk/AboutUs/CompanyInfo/SPARaroundtheworld.aspx [Accessed on 23rd March 2012]. Tesco PLC (2012) Available at http://www.tescoplc.com/about-tesco/our-strategy/ [Accessed on 23rd March 2012]. The Economist (2008). The Germans are coming. Germany’s “hard discount” model of supermarket retailing is spreading in Europe. Available at: http:// www.economist.com/node/11920665. [Accessed on 2nd March 2012]. Waitrose (2012) Available at http://www.waitrose.com/content/waitrose/en/home/about_waitrose/our_company/the_ waitrose_difference.html [Accessed on 23rd March 2012]. 27
  • 32. Wallop, H. (2010) Aldi and Lidl beat Tesco and Sainsbury's in Which? Survey. Avaliable at: http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/7083273/Aldi-and- Lidl-beat-Tesco-and-Sainsburys-in-Which-survey.html. [Accessed on 23rd Febuary 2012]. Wood, Z (2011) Waitrose or Lidl? Shoppers in a divided Britain compare supermarkets deals. Available at http://www.guardian.co.uk/uk/2011/jun/29/waitrose-lidl-shopper-divided- britain. [Accessed on 2nd March 2011]. 28
  • 33. Appendices Appendix 1 Appendix 1.1- Questionnaire- Question 1 Please rank the following supermarkets in order of preference on the following factors. 1 being the least preferred and 12 being the most preferred. Iceland Farmfoods Lidl Spar Aldi Asda Tesco M&S Sainsburys Co- Morrissons Waitrose op Freshness of produce Loyalty Organic Staff Product availability Price Ethics Appendix 1.2- Questionnaire- Question 2 Please rate out of 5 the importance of the following factors in determining your supermarket choice. 1 being of the least importance and 5 being of the most importance. 1 2 3 4 5 Quality of produce Freshness of produce Price Location Ethical position Staff In store convenience Availability of produce/brands Supermarket brand Appendix 1.3- Questionnaire- Question 3 Has your supermarket brand preferences changed within the recession? 29
  • 34. Appendix 1.4- Questionnaire- Question 4 On a scale of 1 to 5 how do you rate supermarket own label brands. 5 being the highest and 1 being the lowest. Appendix 1.5- Questionnaire- Question 5 What Percentage of supermarket own label products do you buy versus market leading brands? Own label brands Market leading brands Appendix 1.6- Questionnaire- Question 6 Which colours do you positively associate with supermarkets? Blue Red Green Yellow Purple Orange Pink Black Brown Appendix 1.7- Questionnaire- Question 7 Have you been to Lidl? If YES what did you like and dislike about Lidl If NO why have you not been and what do you think are the positive aspects and negative aspects of shopping at Lidl? Appendix 1.8- Questionnaire- Question 8 Lidl Users: How often do you go to Lidl? Very Rarely Rarely Sometimes Frequently Very Frequently Appendix 1.9- Questionnaire- Question 9 In terms of colours used, style and design what do you think of the Lidl logo (Please see below)? Please indicate your answer using the scale below, with 1 being the low and 5 being high. 30
  • 35. Appendix 1.10- Questionnaire- Question 10 Please explain why you gave the Lidl logo that particular rating. Appendix 2- Focus Group images 31
  • 36. 32
  • 37. Appendix 3- Lidl Advert Appendix 4- Loyalty Card 33