Research conducted by market research giant, Roy Morgan has indicated that less than half of Coles customers believe that the supermarkets' prices are ‘down down.’
The results state that 45 percent of Coles customers believe that the supermarket has low prices despite its heavy cost-cutting campaigns.
Advertising campaigns from both Coles and Woolworths over the past five years have demonstrated a heavy focus on price. From 2009 to the start of 2012, one in two Coles customers believed that the supermarket had low prices, while rival Woolworths came in lower with just over 40 percent.
The new research however states that the two supermarket giants are now almost on par with Woolworths only two percentage points behind Coles.
“Despite the strong five-year gains overall, still less than half of each supermarket’s customers associate it with low prices. The successful Coles ‘Down Down’ campaign that has aired for three years, would have played a considerable part in moving low price perception upwards among their customers, and been the point of difference that allowed Coles to pull ahead of Woolworths for cut-through of low prices.,” said Norman Morris, Roy Morgan’s Industry Communications Director.
“But perhaps the effectiveness of the ‘Down Down’ campaign has come to an end, with consumers tuning out the message after years of exposure: the latest March 2013 results reveal there is once again only a small gap between Coles and Woolworths customers, primarily due to a decline shown by Coles rather than any ground made by Woolworths.
“Satisfaction levels amongst Coles customers are similarly trending downward, indicating a strong relationship between satisfaction and perception of low prices.
“It remains to be seen whether Coles’ recent advertising campaigns involving promotional competition this will have any effect on reversing the ‘one direction’ Coles is heading in.”
According to the research, Aldi still holds the strongest association with low prices amongst consumers in the sector with nine out of ten believing that the supermarket has ‘low prices.’