Supermarkets are the real 'New media'

Andrew Harrison
Nestl Rowntree

Twenty years ago, selling Kit Kat, there was only one national TV channel, ITV, and a huge spread of retail outlets. Not only were there over 50,000 small independent stores, but supermarkets were smaller and located on the high street. There were 10 or 12 strong players, including Fine Fare, Gateway, Wm Low, Presto as well as Tesco and Sainsbury. Only the latter had more than a 10% share of food retailing. So marketing Kit Kat was relatively straightforward: use ITV to reach a huge audience with a simple message and focus the sales organisation on depth and breadth of distribution through all the small shops.

Today, the complete reverse is true. Now there are four major food retailers in the UK Tesco, Asda, Safeway and Sainsbury which account for about 70% of food expenditure. With Safeway up for sale, this could consolidate further. Even in confectionery perhaps the most fragmented and widely distributed of all food and grocery products these four retailers now account for half the market. In contrast, television and the media have expanded exponentially: there are now over 200 channels, with digital, cable and satellite penetration in about half of British homes.