Backgrounder: supermarkets
As a proposed merger of Sainsbury’s and Asda is announced, and with the retail landscape being reshaped by no-frills retailers and online shopping, two historians consider threats to the dominance of Britain’s biggest chain stories
In the USA, there is a website –
deadmalls.com – that affectionately details shopping malls that have closed, gone bust, been left derelict PROFESSOR LAWRENCE BLACK
Thelatest talk of mergers, takeovers and closures in the supermarket world could leave some UK towns with a single supermarket retailer. This reflects not only intensified competition but also a challenge to the supermarket model of large-scale retail. That challenge has come variously from bulk discounters offering a no-frills experience and from online ordering and delivery, making the large-store model look outmoded. In the US, there is a website – deadmalls.com – that affectionately details shopping malls that have closed, gone bust, been left derelict.
But this may be more about change than terminal decline. Successful supermarket companies have tended to be quite agile, often driving change. Tesco evolved by taking over regional retailers – for example, more than 200 branches of Irwin’s on Merseyside in 1960. Those stores that didn’t adapt – among them, familiar high-street names such as Home & Colonial, Lipton’s and Maypole Dairies – vanished.
Supermarkets really took off in the UK in the late 1950s. Their rise was facilitated by the greater purchasing power of such stores, by Britons’ love affair with the car, and by new technologies such as self-service and plastic wrapping. The lifting of building restrictions, the ending of pricing controls and, later, deregulation in the 1980s also contributed to the emergence of the supermarket as a dominant force.
At the time, many people regarded supermarkets and self-service as modern, American developments – and they certainly contrasted favourably with the austerity of shopping in the communist bloc. In reality, though, they were attempts to save money through bulk-buying, cutting labour costs and transferring the labour of counter service to customers. This proved to be a spectacularly successful strategy. Major chain stores acquired so much financial power that they were able to colonise other retail areas – pharmacy, dry-cleaning, electrical goods – and to buy significant out-of-town property.
And they have continued to evolve. From extended opening hours and an increasingly wide choice of in-store services to the proliferation of retail outlets, the past few decades have seen constant change. But not all recent developments have been groundbreaking. Home deliveries were routine until the rise of the car in the mid-20th century. Sainsbury’s ceased its service (which was originally horse-drawn) as late as 1955.
So what has been the secret of supermarkets’ success? For me, it has been less about pleasure than convenience – more about needs than wants. Supermarkets offer range and choice in a single location, combined with good value and high quality. Notably, too, hygiene scored particularly highly in early UK shopper surveys.
But personal or expert service was rarer in supermarkets, and customer loyalty was harder to maintain. The ‘divi’ (dividend) gave the Co-ops an economic advantage and bond with working-class customers. In the 1960s, Tesco used popular stamp schemes such as Green Shield. More recently, loyalty cards also enabled the mining of big data for individual shoppers. Knowing customers – and ensuring their loyalty – will remain as important as ever as the next phase of competition and change emerges.
There’slittle doubt that large grocery stores shaped the nature of shopping. Supermarkets saw themselves as part of a postwar technological and scientific revolution: a more efficient, streamlined and rational way to buy. Convenience was the watchword. After the deprivation and upheaval of the Great Depression and Second World War, consumers wanted to spend some of their newly earned wages on the home and family, and enjoyed exploring this shiny new consumer landscape.
How did supermarkets change shopping itself? First, they provided convenience and efficiency: instead of having to visit multiple stores, consumers could do most of their shopping in one place. They could buy larger quantities (stored in new gas or electric- powered refrigerators and freezers), so eliminating daily shopping trips.
The shopper also had more control. Instead of relying on a grocer or butcher to select, weigh and bag items, shoppers in self-service stores could select and inspect items, often pre-weighed and packaged. In what was a golden age for industrial, packaged food production, supermarkets were able to expand the range of items they sold. They provided the allure of freedom of choice, though this freedom was restricted to what the corporations chose to sell.
Food companies invested in branding, label aesthetics and advertising (though offering little information about ingredients and nutrients). As a result, consumers developed emotional attachments to brands.
Chain supermarkets embraced fully the values of modernity: clean white decor, predictability, quantity over quality. Perhaps most importantly, high volumes meant that large chains could keep prices down while maintaining razor-thin profit margins.
There was, of course, a flipside, and that was the loss of personal contact. For women with small children, shopping could be a social experience – an opportunity to interact with other adults. In an increasingly impersonal and transactional environment, this was denied them. Over the years, grocery shopping has become ever more mechanised, with the rise of the barcode, self-checkout aisles and cashless payments. In 2018, you can go shopping without having to interact with a single employee.
This has, though, met a backlash. The growing popularity of small, artisan stores are, in part, a reaction to large chain grocery stores. They seek to offer quality, taste, a personal relationship and even a backstory to food. And consumers are increasingly receptive, even at increased cost.
Is the supermarket facing its most serious challenge yet? There have always been small forces of opposition to the massive power of supermarkets – those decrying the quality of industrialised food, questioning the impact of multinational food corporations on global agriculture and economies, highlighting animal cruelty or food waste. Today those have become stronger and more vocal. In the face of climate change and the multi-faceted difficulties of feeding a growing population, the problems facing supermarkets are more intense than they have been for decades.
PROFESSOR AMY BENTLEY There have always been small forces of opposition to the massive power of supermarkets. Today those forces have become stronger and more vocal