Retail News: Iceland shifts focus to price

Iceland is to return to its low-pricing origins and move away from promotions, following its takeover by Icelandic retail group Baugur and former founder Malcolm Walker.

The supermarkets' marketing director, Nick Canning, admitted that in the past there had been an 'over-reliance' on promotions such as buy one get one free.

He added that it will introduce a 'clear-cut' strategy under which all own-brand products will retail at 'simple' prices, such as £2, £2.50 or £3.

Despite the decision, Canning insisted Iceland will not be moving toward an everyday low pricing strategy, as favoured by Asda.

'It is about getting our core basket products to customers at a price which is competitive and in a store that makes it easy to shop. We call it everyday great value,' he said.

In-store, Iceland is to focus on communicating the 'simple price' strategy and is to revamp its own-brand ranges.

Canning said the supermarket has reduced the number of product ranges it stocks by about 30%, with the priority being given to the bestselling lines.

Last week Iceland launched its first national TV ads since it dropped HHCL/Red Cell and hired Tom Reddy Advertising (Marketing, 15 June).

The ads, which feature I'm a Celebrity Get Me Out of Here star Kerry Katona, will be supported by press and direct activity.

Canning said the TV activity will comprise 14 executions. In the next two weeks, ads will focus on the range of food Iceland offers and its home-delivery service. This will be followed by a more product-specific Christmas campaign. The ads continue to use the strapline 'So that's why Mum's gone to Iceland'.

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