I'm not surprised that Tesco's Christmas period and end of year sales figures significantly dropped, if my experience doing business with my local and not so local Tesco stores is anything to go by. All major shopping chains play price games. Customers have become price aware, while at the same time their budgets have become tighter.
A re-engagement with the customer is needed. There has developed a distinct lack of respect for the food shopping public. The senior management, wherever they are based, do not seem to be of this world and so have taken their eye off the ball. The yo-yo pricing games have been crude and offend our basic intelligence.
Autumn 2011, my Tesco shopping basket was radically effected. For example the dairy items I buy, suddenly were offered at two items for exactly double the price, but, an individual pack of the same thing was more expensive. I did not want to double up on dairy produce shopping in order to get the previous equivalent price paid. The same pricing mechanism was initiated with many other products in store, I would not have doubled up my shopping on them either.
Next, while massively advertising there were to be prices drops throughout the store, my single unit items increased from late Autumn 2011 prices by 25% - 35%. I now buy the same type of dairy products elsewhere, weight for weight, no obvious quality difference, at or close to the prices I paid prior to Tesco's Autumn hikes in 2011.
The latest Tesco wheeze is to increase the cost of the 'budget ranges' of foods, pricing them at or close to the main range items. The more expensive foods now advertise a price reduction bringing them closer to the new higher prices of the budget foods! Surely shopping habits of customers must tell the retailer something more constructive than how to alienate their customer base.