(The newspaper online): Nettavisen’s price test of 69 Meny and Kiwi items showed that Meny supermarkets are 11 per cent more expensive in the final total.
See full price overview down in the box.
– This is positive news, obviously we want the lowest possible prices for consumers. But the question then is whether the differences, as this picture shows, will persist, says Olaf Kasland, the Consumer Council’s professional director.
Norgesgruppen owns the menu — Kasland believes the price profile shows margins could be better than competitors Rema and Coop.
The Norwegian Competition Authority previously revealed that Norgesgruppen obtains better conditions from its suppliers.
Rema 1000 sells the same product at very different prices
Fish gratin is 66 percent more expensive
Although only 11 percent separates the minnie and the kiwi, it’s far from the full picture. Our price test shows that 25 out of 69 identical items cost 20 percent or more on Meny’s.
- Fish fondue gratin is 66 percent more expensive.
- Toilet paper and Jif Scrub have a 40% profit margin at Meny’s.
- Eldorado apples and orange juice cost 25 percent more at the supermarket.
Minnie tells Nettavisen that they agree the spreads are huge. Read the full response down in the issue.
– Can create brand confusion
Economics professor Tor Wallen Andreessen at the Norwegian School of Economics was surprised by the final sum of Nettavisen’s shopping cart.
– I think that was a small difference in price compared to the discount store. I’d have thought the Mini, as a somewhat more exclusive concept, was more expensive. When they’re priced too close, it can create brand confusion, he says and explains:
– In order to maintain and establish its brand positioning, Meny, for example, must be 15 to 20 percent higher in price. This would prove that Minnie is something other than Kiwi.
Andreassen notes that the Meny is in the high-class segment, and believes that this should also be proven by the price.
– With a small price difference, customers get the full list of Kiwi prices. One explanation could be that they want to attract more customers to Meny through reward pricing. I think it’s short-term thinking and undermines Meny as a more exclusive concept,” says Andreassen.
The economics professor believes that when customers get more for less, Mini can now attract customers from other low-priced concepts. The expert says this can present the Mini with challenges in dealing with a heterogeneous customer base.
– This often creates fertile ground for reduced satisfaction among customers and employees.
– Is the list losing money now?
– In general, Norgesgruppen, which owns Meny, will probably make money, since they have Jacobs, Kiwi, Joker and Spar all to play, and therefore have a turnover of several different concepts and customer groups with different purchasing power. From a group standpoint, Mini may have cut margins, but overall they’re holding their own.
Menu: – Agree, the price difference is significant
Meny’s director of communications, Nina Horn Hynne, tells Nettavisen that it has slashed the prices of nearly 2,500 popular everyday products.
– We are now making manual corrections as we see lower prices push prices further down to give the customer security on the price, says Hynne, and explains:
– It’s okay to have two thoughts in your head at the same time – good selection and good prices. The fact that the brand offers good quality and good prices cannot be seen as a problem for the consumers.
The communications director points out that price growth is still lower in Norway than in the other Nordic countries.
– Fish, paper, sausage and cheese are product groups with significant price increases from our suppliers, while the price has fallen for consumers for individual products. When we lowered the price of 2,500 important products, we unfortunately did not notice the lower prices in the market for these two examples. We agree that the price difference is significant, thus lowering the price of fishing rods and toilet paper, she says.
Hynne points out that Meny’s has a better selection of sausages and cheeses than the lower-priced chains.
– In these cases, we have other variants that we have chosen as our prize fighters. We sell Gilde Wienerpølser 1.56 kilo packs for NOK 89 per kilo. Similarly, we have almost Gulost Original. 1.25 km from Synnøve. We sell this at NOK 99 a kilo. There are many products that, due to the great competition, we have to sell at a loss. This also applies to dairy and meat products.
This is how the kiwi responds:
– The kiwi is a price driver in the market, and we clearly showed that on February 1st. If it weren’t for the kiwi price pressure, food in Norway would be much more expensive now. Many customers have recognized this, since we have fantastic customer growth right now, says Nora Mael Helgesen, Kiwi Communications Consultant, and adds:
– We work hard every day to win customers the lowest prices and the best reward deal for fruits and vegetables, not least the cheerful and skilled staff.
Coop is a partner in the DIG Research Center at NHH. Professor Andreessen is part of this project.
The prices may have changed after Nettavisen checked the prices. The listing states, among other things, that they have reduced the price of Maarud’s potato chips to 29.90 and Omo Ultra White 595 ml to 43.90 after we checked the prices.
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