Tesco sells Jack's products at supermarkets
Tesco has begun selling private label products from its Jack’s discount format across its Tesco-branded full-range stores in the UK, with nine Jack’s products appearing alongside Tesco’s main private label ranges in 851 stores throughout May. The changes are part of Tesco’s 100th birthday celebrations, which have also seen the supermarket cut prices and offer 50% discounts on selected items to Clubcard customers.
Tesco launched its Jack’s banner in September 2018 as a response to the growth of discounters Aldi and Lidl in the UK, offering a limited assortment of 2,000-2,500 SKUs, of which more than two-thirds are private label under one Jack’s brand. The addition of Jack’s products to Tesco core stores is indicative of disruption in the market, from both discount and ecommerce – requiring retailers to more aggressively target their key customer groups.
Tesco’s SKU reduction program, margin target of 3.5-4% and listing of additional economy private label lines will lead to increasing pressure for brands on shelf space and margin. To defend their relevance for Tesco, brands should invest in category insight to support the retailer with market positioning, product innovation and merchandising solutions across its omnichannel portfolio.