RETAIL NEWS: Thresher profits from ‘accidental’ promotion

Retailing in the run-up to Christmas 2006 in the UK will be best remembered for the mass of discount vouchers spread by e-mail circulars.

Chains such as Gap, New Look and Habitat distributed the offers via e-mail to kick-start sales. But the most headline-grabbing campaign was that by a drinks retailer.

British convenience-store owner Thresher Group experienced a 60% sales surge in a single weekend due to a money-saving coupon initially intended for corporate customers. The promotion, as reported in the drinks business newsletter (29.11.06), was launched as a word-of-mouth deal offering 40% off wine and Champagne in Thresher, Wine Rack, Bottoms Up, Haddows and The Local chains between November 30 and December 10.

A PDF of the voucher featured on South African wine Stormhoek’s website and quickly spread among the public via e-mail. It is estimated the coupon was downloaded several million times.

“The effect has been fantastic,” Roger Whiteside, CEO at Thresher Group told the drinks business. The suggestion by certain national newspapers that Thresher Group might suffer as a result of the unexpected rush of shoppers did not prove true. “It is a heavy discount but there is still a positive margin and we have made more money out of it in the end,” explained Whiteside.

However, the drinks retailer was surprised at the response. “We didn’t plan anything like this,” Whiteside admitted. “We have sent our corporate partners coupons the last two years and on this occasion they sent it on to friends and family.”

Whiteside, who was previously joint-MD of on-line supermarket Ocado, added, “I have been in internet marketing for years and viral campaigns happen by luck, not by design.”

The offer sparked a series of deep discounts by other retailers selling wine. Sainsbury’s used the internet to publicise a 25%-off deal on wine and Virgin Wines followed with a 50% reduction.

Tesco plans UK’s biggest store

Tesco is proposing to build Britain’s biggest supermarket, planned for Purley in south London. An existing Tesco store will double in size if the project gets the go-ahead. At 12,913 square metres, the new outlet would be three-and-a-half times the size of a football pitch.

Presently, Tesco’s largest store stands at 11,055 square metres, while the biggest shops of competitors Asda and Sainsbury’s are 10,219 and 8,082 square metres respectively.

The proposal has been met by opposition from local residents who are adamant that the area doesn’t need a larger store.

The plans for the new complex include rerouting Purley’s busy A22 Godstone Road around the back of the current Tesco building and building a number of houses.

In 2006, Tesco became the fastest-growing supermarket clothing retailer and launched its own-brand computer software towards the end of the last year.

Supermarkets ready to roll

Supermarket chains are planning to build hundreds of new stores in Britain as it appears a restriction limiting their growth will be lifted.

A treasury-backed document into the planning system by Kate Barker, author of the Barker review of housing supply and member of the Bank of England’s monetary policy committee, has recommended that the so-called “needs test” should be scrapped.

This prevents the building of large-scale shopping schemes unless the retail space in a defined area is deemed insufficient. Without this test it is feared small shops will close as supermarkets open across the country. Town centres, it is believed, will decline without this obstacle to building out-of-town superstores.

“There’s a danger this could be a charter for carpeting the country with supermarkets,” said Gideon Amos, chief executive of the Town and Country Planning Association.

Top Euro wines on the web

A new wine website has been launched by a couple of British entrepreneurs promising “24-hour access” to European growers. The new service, called FromVineyardsDirect,offers a small range of top-end wines from Europe.

It is the brainchild of partners David Campbell and Esme Johnstone. Campbell is the publisher behind Everyman’s Library and France’s Le Guide Hachette des Vins. Johnstone is a founder of Majestic Wine who later bought the Château de Sours estate in Bordeaux.

“We aim to offer wines at 20% or more under prices through traditional channels,” said Campbell.

“The idea for FromVineyardsDirect.com came because I was annoyed at having to fork out £13.99, or often rather more, for a good 1er Cru Chablis and I had seen what the potential of the internet had done to book buying.”

The website was launched at the French Ambassador’s residence in London.

© db January2007