Coles drops, freezes, private label prices

Karen Collier,
July 13, 2016
Herald Sun
GROCERY shoppers hungry for lower prices are gravitating to supermarket own-brand labels as perceptions of quality improve.
The push to get customers to fill trolleys with private labels is intensifying as dozens of Coles brand product prices today drop by up to 25 per cent to beat, or match, competitors.
The supermarket giant has also pledged to freeze prices for almost 1000 Coles brand items for at least six months.
From today, the cost of 145 goods ranging from bakery wraps to cakes, sunscreen, shredded cheese and school lunch sandwich bags will be reduced.
They are among almost 1000 extra Coles brand items moved to a set “everyday” price rather than being subject to specials or multi-buy discount deals.
Industry analysts predict supermarket private labels will snatch a 35 per cent share of grocery sales within a few years, up from about 25-30 per cent now.
What started as a home brand invasion for staples such as bread and milk has spread to other categories including alcohol. Supermarkets have been courting middle and high-income customers as well as the traditional low-income fans of home brands.
There has also been a steady shift from fluctuating promotions to everyday pricing.
About one-fifth of all 20,000 products, own brand and otherwise, sold at Coles are now on an everyday price strategy.
Coles managing director John Durkan said its stable price promise for almost 1000 Coles brand groceries was the biggest ever made in one swoop.
“Everyday prices give customers value they can trust every time they shop with us and means they don’t have to wait for a special to buy at a great price,” Mr Durkan said.
“We are continuously investing in Coles brand … We’ve seen significant growth as our customers respond to the quality, taste and price of our private label products.”
In a bid to arrest discount chain Aldi’s private label success, Coles and Woolworths have revamped their in-house brands.
Coles’ Smart Buy and Simply Less brands have been replaced with a single Coles label.
Rival Woolies is renaming its Homebrand range Essentials. Its Select brand will be phased out and badged as Woolworths.
PRICE CHANGE EXAMPLES (WAS/NOW)
Wraps (white, light, wholemeal, grain) 8pk $3/$2.25
Mud cake (chocolate, vanilla) 600g $6/$4.50
Australian shredded cheese tasty, tasty light 700g $6.50/$5.50
Sponge roll (jam/chocolate 400g, mini choc/mini jam 6pk) $3/$2.50
Sandwich bags resealable 50pk $2/$1.80
Sunscreen everyday SPF 50+ 1l $10/$9
Hazelnut smooth spread 400g $2.80/$2.50
Pasta sauce varieties 690g $2.29/$1.95
Ultra Booster Oxy Advanced Soaker 1kg $4.50/$3.70
Organic traditional rolled oats 500g $4.58/$3.75
Stainless Steel Scourer $1.15/$1
A4 Copy Paper $6.20/$5
*Victorian prices