This week, we explore two major shifts in the FMCG landscape. First, we examine how retailers in New York are adapting to new realities, from heightened security measures to checkout innovation and omnichannel strategies. Then, we analyze Tesco’s evolving Aldi Price Match strategy—what’s driving the change and how it reflects a broader shift in consumer spending patterns. Finally, we connect these developments to a wider trend in FMCG: companies adjusting pricing, packaging, and innovation to meet increasingly value-conscious consumers.
Retail Trends from New York: A Discovery Tour
Retailers in New York are rapidly adapting to consumer expectations and economic pressures. Lebensmittel Zeitung’s visit to 22 stores, including Whole Foods, Aldi, and Duane Reed (Walgreens). As I am a European living in New York, I can confirm the stark differences to observe in this market:
Security Measures Are More Intense Than Ever Retail theft is a growing issue, leading to a surge in security measures. Walgreens now locks up even basic products like toothbrushes and lip balm, requiring customers to press a button for staff assistance. CVS is testing an app to grant access to locked products, while self-checkouts increasingly feature live security camera feeds to deter theft.
High-Impact Digital Signage Screens and electronic price labels are becoming essential for marketing and price updates. Wegmans features massive visual displays, Lidl integrates digital signage into promotions, and touchscreens are enabling a seamless online-offline shopping experience.
Checkout Innovation Is Accelerating Payments are evolving quickly. Whole Foods now offers palm-scanning payments via Amazon technology, while other retailers have eliminated fixed cash registers in favor of roving staff with tablets and NFC readers. Meanwhile, Trader Joe’s remains an outlier, maintaining its traditional small manned checkouts where employees bag purchases for customers.
Loyalty & Omnichannel Are the New Normal Almost every retailer has a customer loyalty program tied to discounts, with seamless integration of online and in-store shopping. Many large grocery stores now have employees dedicated to picking online orders for store pickup.
Sustainability Efforts Are Emerging—But Face Challenges While Wegmans has introduced bottle deposit machines and plastic bag bans remain in place, sustainability initiatives remain inconsistent. Some fear a rollback, as figures like Donald Trump advocate for a return to plastic straws and bags.
Tesco Adjusts Its Aldi Price Match Strategy
Over in the UK, Tesco has made a significant shift in its Aldi Price Match program, reducing the number of matched products from 790 to 645. The company attributes this to a revised selection method, now requiring Aldi to stock a product in at least 10 stores instead of just five to qualify for price matching.
However, analysts suggest that Tesco’s move is also a reaction to reputational risks. A BBC Panorama report from September 2024 criticized the quality of Tesco’s budget private-label products compared to Aldi’s. The most striking example: Tesco’s chicken nuggets contained only 39% meat, while Aldi’s equivalent had 60%. Aldi capitalized on this with a cheeky marketing campaign, forcing Tesco to reconsider its pricing approach.
As a result, Tesco has removed many of its lowest-tier private labels from the price match to avoid further scrutiny, while continuing to align its standard private-label pricing with Aldi’s.
Despite this adjustment, Tesco’s pricing strategy remains a key driver of its success. The latest Kantar figures (January 2025) show Tesco growing its market share by 1.9 percentage points to 28.5%, while Aldi has increased to 10.2%. Meanwhile, competitors like Asda and Morrisons have struggled despite their own price-matching campaigns.
FMCG Brands Are Reassessing Value and Pricing Strategies
Tesco’s shift highlights a broader trend: FMCG brands are rethinking value and affordability in response to changing consumer behavior. Recent reports show that brands across various categories—snacks, household goods, cosmetics, and tobacco—are adjusting packaging sizes, product formulations, and price tiers to appeal to a wider range of consumers.
Consumers Are More Price-Sensitive—But Not Just Looking for Discounts
While inflation has eased in some regions, many shoppers remain highly selective. However, value doesn’t always mean lower prices—brands that offer better-perceived value through innovation or format flexibility are gaining traction.
PepsiCo is adapting snack pack sizes to match consumers’ shifting budgets. The company now offers smaller multipacks (6 or 8 bags instead of 18+) and single-serve chips priced under $1 to appeal to cash-strapped shoppers at the end of the month.
Clorox is marketing premium versions of everyday essentials, like stronger Glad trash bags and concentrated Pine-Sol cleaner, to give consumers a greater sense of value without lowering prices.
Estée Lauder is working on rebuilding demand across price tiers, from $25 lipsticks to $1,000 perfumes, while acknowledging that its past strategy didn’t do enough to attract new consumers.
PepsiCo’s and Tesco’s approaches are strikingly similar—both are recognizing that shoppers’ spending power fluctuates over a month, and they need flexible options. For Tesco, this means refining its Aldi Price Match to focus on core products rather than chasing the lowest possible price.
Final Thoughts
This week’s stories highlight a common theme: retailers and FMCG brands are adapting to an era of selective consumer spending. Whether it’s Tesco adjusting its price-matching approach, New York retailers enhancing omnichannel experiences, or brands like PepsiCo and Estée Lauder innovating across price tiers, companies that provide value beyond just discounts are positioning themselves for success.
That is it for this week’s episode of FMCG Weekly! We have more news and insights every week. Make sure to subscribe and stay up to date with the latest in consumer goods and retail. And remember: for independent and non-conformist advice on revenue management, go to accuris.com. See you next week!
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