Tesco has been having a tougher time than usual this year. At a corporate level, its latest set of financial results was described by the Daily Mail as “the worst sales results in 20 years”. Just as bad, recent attempts to convince consumers of its competitiveness have led to PR own-goals.

Price Check and Big Price Drop

In Spring 2011, an aggressive price promotion called Price Check (aimed at Asda) backfired when canny consumers worked out how to use Tesco’s scheme to generate substantial cash refunds. This forced Tesco to drop the scheme, creating consumer frustration and leading to comparisons with Hoover’s unsuccessful flight promotion 18 years ago. Undeterred, Tesco came into autumn with its Big Price Drop campaign. Unfortunately, trade magazine The Grocer, The Guardian and The Daily Mail all ran stories that suggested some Tesco products lines were more expensive than before.

Counter-lobby

In PR terms, this is an interesting development, which suggests two things. Firstly, that Tesco has become so big that it now has to deal with a counter-lobby that will scrutinise its every move (the kind of situation faced by governments and uber-brands such as BT, British Airways and Sky). Secondly, that there is little benefit in making bold universal statements, because there’ll always be someone, somewhere ready to take you on.
This is truer than ever now that most of us are active via digital media. In the case of Tesco’s Price Check promotion, for example, details of how to take advantage of the scheme appeared on internet chat forums and a Manchester United fans’ site, where a fan claimed to have made £600. As for the latest campaign, the furore of negative PR in the press set off a wave of Twitter chatter that still hasn't quite died down. As recently as last week, MSN Money was still passing on the story as if it was a new development.

Rival commentary

The PR fallout doesn't stop here either. Having found flaws in Tesco’s discounting model, journalists did the obvious thing, which was to go to rivals for comment that would give the story fizz. In the case of Price Check, Asda told the press that Tesco was unable to live up to its promises on low prices: “If you claim to be the cheapest, call me old fashioned, but it helps to really be the cheapest”. As for The Big Price Drop, Sainsbury’s dismissed it as “smoke and mirrors” and went on to flag up a secondary story that otherwise might not have seen the light of day; the fact that Tesco was cutting the value of its loyalty card points scheme, effectively clawing back most of the money it had pledged as part of its discount scheme. That’s just the kind of semi-visible marketing ploy that makes consumers fume.

Test your assertions

So what’s the upshot of all this? Well the obvious message is that retail brands (not just Tesco, all of them) need to stress test their claims, particularly if they are comparative with rivals. It’s one thing to say your blueberry muffins are cheaper than a rival’s this week, it’s another to make an absolutist claim if it is based on contentious assumptions. Far better, as one commentator suggests, to pop a money-off voucher in the post.
The need for clear messaging is more important than ever now that social media has gained a grip – because journalistic and rival comments become amplified once they are enmeshed with; a) individual complaints, and; b) die-hard Tesco opponents (those who resent its scale or its impact on high street commerce). Tesco has shown it is thinking about social through its acquisition of word-of-mouth agency BzzAgent (echoing Walmart’s acquisition of Kosmix). But online brand advocates will only be taken seriously if consumers have confidence in Tesco’s overall messaging.

Top tips on retail discounts

• Stress test the authenticity of your claims because if you don’t journalists and rivals will.
• Keep the message simple and consistent because consumers are too busy to get embroiled in the details of product pricing.
• Try not to frame your offers as cast-iron comparisons because these often don’t stand up to scrutiny and will probably drag you into a PR catfight.
• Engage with consumers in the social media debate – because they expect it; but make sure you hit the right tone. Don’t be too familiar or jokey. But don't be too formal.
• Be prepared for opponents to jump on a PR problem and amplify it via social media channels.