Tuesday, 31 January 2012

The Duopoly Duel: a couple of monopsonists slug it out

As Coles has forged ahead under its new owners Wesfarmers and Woolworths is not quite so dominant anymore, some questions about its brand placement have been raised.  It is suggested that "Woolworths - the Fresh Food People" was good branding and still relevant; that Woolworths is on the back foot because it had let this particular branding slide to respond to Coles discounting.

I noticed at the week-end (was it as I was watching the eternal never-ending Djokovic-Nadal tennis match?) a ramp up of Woolworth's advertising on this theme.  I thought: Ahah! How will Coles now respond to this?  News from the front to-day indicates Coles is shifting its price war to fresh food, to our fruit and vegetables.  

Now I'm pretty sure this is not, in the first instance, a response to "the fresh food people".  Rather, it is more of the same price placements that Coles has been adopting for some time.  Coles claims the company had worked closely with growers to transform their fresh fruit and vegetable prices, investing in new growing techniques, quality control, store displays and now lower prices for customers.   I wait for the next exciting episode of the Duopoly Duel

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