The supermarket chain’s reputation on price and quality may yet save its name

WHAT’S IN a name will be the thorny issue facing Musgrave chief executive Chris Martin, assuming the Cork grocery giant gets the green light from the Competition Authority to finalise its takeover of Superquinn.

Should Martin retain the Superquinn brand or should he give it up in favour of Musgrave’s main retail brand SuperValu? Judging by the diversity of opinion among branding and advertising experts, Martin’s decision won’t be an easy one.

Orlaith Blaney, chief executive of advertising agency McCann Erickson, favours creating one retail powerhouse under the SuperValu banner. “Long term, the one brand name probably makes sense. There is real strength in the SuperValu brand and the cost synergies associated with running one brand in Ireland aren’t inconsiderable. If they did consolidate under the SuperValu symbol, you could bring the best of the Superquinn products and integrate the positives to add even more value to SuperValu.

“I think you’d have to transition the existing Superquinn customers gently and not get rid of all the Superquinn things they like. I expect both brands to stay for now but SuperValu plus some of the things Superquinn is great at could create a very powerful brand story.”

On the other hand, Conor Kennedy, creative director of agency Javelin, believes Musgrave should retain the Superquinn brand: “There are not many Irish brands embedded in people’s consciousness and Superquinn is definitely one of them,” says Kennedy. “I would keep Superquinn as a premium brand and extend it. Superquinn is tiny compared to its rivals in terms of reach so I would put it into the posher areas outside of Dublin.

“SuperValu is a very good mid-market brand but it can get squeezed between the Spar and Eurospar. Everybody knows what Superquinn stands for. There is no room left at the discount end of the market but there may be room at the upper end of the market.”

Advertising agency Rothco worked on the Superquinn account last year and pushed for a marketing strategy focused on service and quality instead of price. According to creative director Damian Hanley, “the Superquinn management team seemed to bottle it at the last minute and the whole thing became about price. Superquinn should be talking about nothing else than the fact that their steak is the best meat you can possibly buy. That gives the customer the rationale to defend their decision to go to Superquinn.

“It’s insane for Superquinn to be competing on price because they will never be an Aldi or a Lidl. MS do ‘food porn’ and have benefited hugely, mopping up Superquinn’s potential market.”

Jonathan Amm of Cork branding consultancy ThinkTank notes that Fergal Quinn operated on the basis that a great brand is underpinned by a strong customer value proposition. “Quinn set about exceeding customers’ expectations constantly through a culture of innovation, relentlessly placing the customer at the core of the organisation,” says Amm.

“However, Superquinn’s position has been eroded by new market entrants or incumbents who have successfully negated Superquinn’s advantage and then gone one better. Over time, Superquinn has moved to the centre, driven by the recession to compete on price. Now the Superquinn brand is stuck in the middle, neither superior on price or experience/service,” he says.

“Musgrave now has the opportunity to reposition Superquinn and redefine what the brand stands for. Musgrave can tap into the existing goodwill surrounding the Superquinn brand and use its different brands in different market segments to counter competitors and gain overall market share.”

Brand consultant Seán Whitaker firmly believes Musgrave should not ditch the Superquinn brand. “SuperValu stores around the country closely reflect their locale while Superquinn’s brand constituency is united in lifestyle and aspiration rather than geography and community,” says Whitaker.

“Based on its heritage, Superquinn can have a more upmarket appeal where Tesco and Dunnes need to be all things to all people. However, at the moment Superquinn does not live up to the metropolitan, upscale brand promise that it once had. Outlets like Donnybrook Fair, the English Market, Mortons and especially MS now define the top end.”

Whitaker adds: “Repertoire shopping is increasingly the norm ie one place for big box washing powder, another for the Sunday roast. Superquinn needs to be ‘famous’ for something.

“Assuming prices are at least in contact with the competition, the cliche ‘value is more than just price’ still applies. Emotional benefits like self-worth and status projection are still important and felt to be worth paying for.”

Howard Kent of the branding consultancy Anchora Solutions says his advice to Musgrave would be not to fold Superquinn into the SuperValu tent. “A brand is owned by its customers and the company behind the brand is its guardian,” says Kent. “Customers do not like someone playing around with ‘their brand’ unless they have indicated there is something wrong and they want it to change. The Superquinn brand message is all around service and quality . . . It is imperative the changeover is seamless and the service, quality and customer experience is maintained and preferably exceeded.”

siobhan@businessplus.ie