Co-op own-label wine is big winner in loyalty scheme
The Co-operative Group’s revamped membership scheme is helping to drive sales of its own-label products, with the wine category benefitting the most.
The scheme was overhauled so that when shoppers buy selected Co-op branded products, the retailer will put 5% of the amount spent back into their membership account.
Simon Cairns, category trading manager for BWS, told OLN: “The biggest lift we have seen since the relaunch has been on wine. Until recently the membership cards have not had much relevance, but now you get 5% back in your wallet and I think it’s a really compelling message about our own-label. The Co-op is really focusing on its own brands.
“The interesting thing is that it’s the Truly Irresistible tier of wine that’s seen the uplift, not the entry level, so it’s the wines priced in the £7-£8 price bracket. These have seen an 8% uplift in sales over the past couple of weeks since this change in membership offer. Nothing else has changed in terms of promotional activity, so it must be down to that. At the moment the Truly Irresistible Leyda Valley Sauvignon from Chile is a real success story and the Bío Bío Valley Malbec.”
Cairns said the Co-op has also focused on being less reliant on promotions. “Big spikes in demand cripple our supply chain. So if we go for an everyday low pricing strategy instead our supply chain can cope better. I think it is better for consumers.
If they try something one week then go back to find it the next but it is at a higher price they may go for something different that’s on offer. We can get a better idea of what people like if we stick to EDLP.
“Last month the volume of wine sold through promotion dropped below 40%, which is 7% lower than this time last year. It is the first time I can remember the volume of wines on promotion dropping below that 40% mark.”
The retailer has also recorded success with sales of its mini bottles of Prosecco. “We gave these more space last range review and, as a result, we have seen sales grow by 23%. It has been a real success. In the future our challenge is to offer more premium wines in this format.
Currently they work at entry level but we want to look more at premium wines, particularly for our more premium stores.”