Retail expert says Big Four should 'cosy up' to discounters

By Gemma McKenna

Published: 27 October, 2014

A leading retail expert has said Britain's Big Four need to ditch larger stores and "cosy up" to discounters by locating convenience outlets next door.

Sainsbury's Local Convenience is more suited to the modern consumer, argues EvanshitzkyMarketing professor at Aston School of Business, Heiner Evanshitzky, argues that the major retailers should take advantage of discounters' success, but siting shops next door.

Evanschitzky, professor and chair of marketing at Aston Business School, suggested major retailers take advantage of discounters' success by siting stores next door so consumers can pop in to purchase more premium items.

Over the weekend, the Sunday Times published a story saying that one third of its hypermarkets are failing, aligning with Evanshitzky's assertion that "the era of the hypermarket is over. Welcome to the age of convenience".

In a column for Harpers.co.uk, Evanshitzky said "the Big Four need to do more to stand out from the crowd". He slammed the continued price slashing as "irritating and confusing" for consumers and said they need to innovate.

He suggests locating smaller stores closer to consumers and complementary services, such as coffee shops, hairdressers and pharmacies. More controversially, he said they should also "bite the bullet and start cosying up to the discount retailers - literally. Opening a smaller store next to an Aldi or Lidl and focusing on complementary, high-margin products that offer a wide rather than deep assortment will allow customers to buy their basics at the discounters, and visit the Sainsbury's Local or Tesco Express next door for the treats, such as that nice bottle of red for tonight's dinner party".

They should also be looking to innovate to get ahead, he said, pointing at some new methods already used in Asia, such as South Korean commuters' ability to do their shopping from virtual shelves on train station walls, which arrives home before them.

"This kind of innovation is what retailers should be focusing on, rather than the continual price-slashing that continues to irritate and confuse consumers and suppliers," he said.

"Click and collect services at train stations are already proving popular," Evanshitzky said, but retailers need to do more to access changing shopper habits.

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