Can Too Much Innovation Depress Sales? Tesco Says Yes

tesco

More old news from the realm of over-innovation: Tesco is blaming it for depressing sales.

The giant, but troubled, British supermarket chain is to jettison almost one-third of its immense product line to reduce customer confusion and increase profitability, The Guardian newspaper reports.

The retailer takes in one of every seven pounds spent in the UK, but it is facing stiff competition from discount retailers Aldi and Lidl.

However, it carries 90,000 SKUs compared to a typical discounter’s 2,000.

Tesco’s selection overwhelms shoppers and is expensive to stock, The Guardian says:

With tomato ketchup, Tesco offers a bewildering array of 28 sauces while in Aldi there is just one ketchup in one size.

One market analyst at Kantar Retail was quoted as saying, the grocery business was “guilty of self-serving innovation.”

The issue has been addressed before in retail. The #Innochat group, for example, explored whether it was possible to over-innovate.

In discussing the matter during their weekly Twitter session, many group members expressed annoyance at expanding product lines.

In one comment typical of product-line extensions, Andrew Marshall (@DrewCM) asked: “What problem is solved by Honey Nut Cheerios (Now with more honey!)???”

Image courtesy Wikimedia Commons.

 

 

One thought on “Can Too Much Innovation Depress Sales? Tesco Says Yes

  1. Pingback: Is There Such A Thing As Over-Innovation? | John P. Muldoon

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