The battle between Levi-Strauss and Tesco - or between consumer
cheat and consumer champion, as much of the national media would have us
believe - is now moving into stage two.
Following the European Court of Justice (ECJ) ruling against Tesco,
there was an immediate flurry of tabloid outrage that 'they' (the
Europeans) had banned 'our' (good honest Brits everywhere) right to
cut-price branded goods (seemingly now a God-given one). One week on,
brand manufacturers and retailers are taking up position, attempting to
maintain the story's momentum in their favour - or where that fails
launching their own marketing communications on the issue.
This week Tesco unveils an ad campaign through Lowe Lintas, boasting
that it will continue to sell discount Levi's sourced legally from
within the European Economic Area. Asda has vowed to battle European
legislation on parallel imports and is adamant it will continue to sell
cut-price French Connection, Nike and Calvin Klein gear.
On the manufacturer side, French Connection has responded by slamming
Asda for selling previous seasons' fcuk merchandise, taking the
understandable line that the out-of-date connection is a damaging one.
Far less understandable is the news that Levi's is to sell more
clothing, more cheaply through its discount outlets.
The logic at Levi's has become seriously twisted. Having put up a
rigorous defence that it has invested heavily in building the quality
promise and desirability of its brand, Levi's is now conceding that
those attributes can be picked up at a knock-down price in one of its
Factory Outlet Stores.
This is precisely the sort of price-meddling that got Levi's into a mess
in the first place. Consumers are not blind to such hypocrisy. A
convincing and consistent argument that a premium and innovative brand
must maintain investment, and consequently a certain margin, would have
been the right line to take.
Instead, Levi's appears to have buckled to media pressure. To constrain
Tesco's ability to sell cheap jeans looks indefensible if Levi's then
broadens the range of discount stock available through its ill-named
It is factory output, poorly controlled, that is one of the root causes
of problematic international price disparity.
There is a strong case to be made for protecting brands from the damage
that opportunistic retailers can inflict - and it is one that Marketing
will continue to make. But the brand defenders are currently losing the
debate. Until they regain control over how and where their products are
distributed, and stop sending mixed messages to consumers, they will
continue to lose.