Every little less never helps

Four years ago, I wrote about how the ever-increasing beer choice in supermarkets was cutting into the market of independent off-licences. At the time, it was a valid point but, as often happens, subsequent events have gone in the opposite direction. The craft beer sector has expanded into ever more obscure sectors, most of which the supermarkets will never touch with a bargepole, even if they stock Punk IPA and Hardknott Azimuth. And there has been a big growth in independent beer-focused off-licences, often in city-centre locations, which appeal to high-spending young hipsters professionals who probably never get in to Tesco Extra.

My local Stockport branch of that particular chain was notable for its impressively wide beer and cider selection, something that twenty years ago would not have disgraced a specialist off-licence. However times have changed and, in response to the challenge from discounters like Aldi and Lidl, the major supermarkets have been looking at streamlining their operations and rationalising their ranges. Apparently 20% of all products stocked sell either one item a week, or none.

So Tesco have decided to take the axe to their beer range. One of the most high-profile casualties has been Carlsberg, as Stonch reports here, but their more specialist ranges have been drastically reduced too. Imported German and Czech lagers, Belgian beers, premium ciders, British craft beers, all have suffered. The Premium Bottled Ale range doesn’t seem to have been too badly affected, and is always subject to churn anyway, but one of my favourites, the bottle-conditioned Shepherd Neame 1698, has disappeared. Some of the shelf space seems to have been reallocated to PBA multipacks.

Regular blog readers may have noticed that I have a fondness for authentic imported German lagers. Tesco used to sell three – Bitburger, Krombacher and Warsteiner – which were usually included in multibuy deals. Not maybe Augustiner Helles or Jever Pilsner, but all very decent, palatable beers. Now all gone, along with similar beers like Baltika 7 and Pilsner Urquell. Surely a range rationalisation should have reduced the three to one, rather than scrapping the category entirely.

Obviously supermarkets have an interest in selling whatever they can sell, whether beer or bread. But the beer category has wider implications, as it is one of the factors that people will use to choose one supermarket above another (rather like cask drinkers choosing which pub to go to) and also an area where supermarkets can reclaim market share from independents. They will never remotely match the range of the specialists, but there’s a substantial proportion of customers who might think if they can get Punk IPA in Tesco for £1.50, there’s no point in making an effort to trek to the independent to pay £2.80 for Beavertown Gamma Ray.

If customers think “oh well, I’ll manage with what’s left”, then Tesco have won. But if they think “I’ll now have to go somewhere else for that”, it may seriously undermine their business. The key USP of the conventional big supermarkets is that they offer a much wider ranger than the discounters. If they cease to do that, what’s the point? Tesco have also recently annoyed me with several delistings of non-beer products.