Following in the footsteps of Aldi and Lidl, the French-owned retail giant Carrefour has now also announced that it too is to cut the price it charges for some basic products. After a year of what have sometimes been fairly sharp price rises could it be that the tide is finally turning?
Home News
After a year of price increases supermarkets engage in promotional price stunt battle
Published:
The Leuven University (KUL) professor of marketing and retail expert Els Breugelmans believes that this isn’t the case. "It concerns 100 products among the 30,000 products on sale in a large supermarket”.
On Monday morning Carrefour announced that it is to cut the price it charges a hundred basic products in the early weeks. These range from spaghetti to potato croquettes and toilet paper. Carrefour says that it "Wants to boost the purchasing power of Belgian families”.
Previous Lidl and Aldi also announced that they are discounting some of their products albeit to a lesser extent than carrefour. Could there be some light at the end of the tunnel of spiraling food inflation or is something else at play here?
The battle for customers
Professor Breugelmans told VRT News that "You often see promotions in stores, but price cuts on so many products at the same time are indeed exceptional”.
However, this is not about the supermarkets being charitable or a sign of a general deflationary trend when it comes the price of food. "It is more part of a major battle to win over customers that were confronted with big price increases during the past year. The chains may say that this concerns ‘basic products’, but in reality, it concerns a small percentage what they sell."
"The average hypermarket has 30,000 products, of which about a hundred will now fall in price. The customer who is lured to the store by these offers will probably also buy those other products too"
The actions of Carrefour, Lidl or Aldi will therefore have no effect on the so-called “index”, the virtual basket of goods that determines, among other things, whether the level of wages and benefits need to be adjusted. Professor Breugelmans told VRT News that "This is more about PR issue than anything else"