Australian supermarkets “backward”?

Posted by Daniel Palmer on 3rd August 2009

The Marketing Director of Coles sees the refurbishment of stores across the country and the entry of new competitors to the Australian landscape as an opportunity to rid the country of a “backward” approach to supermarket retail.

Joe Blundell, who joined the supermarket chain last year from UK retailer Asda, said the industry still had a way to go in order to improve the damaged perception of supermarkets.

The new management team at Coles has readily admitted that there was chronic underinvestment in the chain but Mr Blundell suggested Coles wasn’t the only chain to lack initiative when it came to supermarket development. He believes, however, that with greater funds being directed toward brand and store improvements at both Coles and Woolworths and new entrants to the arena heightening competitive tension, there is the potential to turn the negative perceptions around.

“It’s staggering that supermarket retailing in a country like Australia that is so into food should be so backwards – it’s not right,” Mr Blundell told The Australian. “If you get different players all competing with each other it definitely raises the game.”

Mr Blundell said that the chain’s marketing philosophy had changed since the Wesfarmers takeover, with the hiring of chef George Calombaris and a group of mothers to test products a sign that they were prepared to embrace different strategies to get results. And there are more initiatives in the pipeline, according to their head of marketing.

The supermarket chain is also more intent on moving with the economy, Mr Blundell advised, with their focus on home cooking – via the successful “Feed Your Family for Under $10” campaign – dependent on changes in consumer behaviour.

“You never know whether you’re at the beginning of a really long trend or whether you’re seeing just a little blip,” he said. “We’ve no idea whether we are going to get back to wholesale people cooking at home where people are going to embrace that for a long long time.”

The financial crisis was the catalyst for the home cooking trend, but Coles believes it has the potential to kick on as shows like MasterChef encourage the whole family back to the kitchen.

“I guess the economic thing will disappear … but that bringing family together (element) won’t go away,” Mr Blundell concluded.