As the new £1 coin is introduced, discount retailer Poundland has unveiled its new pricing strategy, however focus will remain on the core price point.
New price points: 50p, £2 and £5
Poundland has introduced three new price points - 50p, £2 and £5 - taking it from a single-price retailer to a multi-price retailer following trials of conditional spend in-store. Following customer research however, the Poundland offer will remain simple and only these three price points as well as the core £1 price will be used to dictate the discounter's pricing strategy. This new move takes Poundland more in line with its European fascia Dealz which is currently present in Ireland and Spain, and sells products at a variety of price points with €1.50 being the most common price.
As well as having new price points across Poundland's offer, the introduction of Pep&Co clothing shop-in-shops and edited ranges in smaller stores will see Poundland offer an even larger multi-price offer. 90% of the Pep&Co offer is under £10 so the clothing offer remains a value one in line with Poundland's proposition. By the end of the year there will be just over 100 Pep&Co shop-in-shops in larger Poundland stores, while a smaller range will be introduced this April in 577 UK Poundland stores. There is scope in future for Pep&Co clothing to be introduced in Ireland's Dealz stores also, however focus remains rolling out in the UK and establishing the brand.
Focus remains on £1
While there are significant changes and enhancements being made within the Poundland business, trading director Barry Williams has stressed that the business is committed to the pound. While inflation could cause the business difficulties, Williams is confident in the new team's focus on re-engineering the business and the cost-savings that can be made to ensure the pound stays king. As the UK gives the pound a new look, Poundland is reflecting this focus on its core price point by using it as a tool to market its continued value.
Look out for our update on Poundland's strategic priorities and Woolwich store visit report on Retail Analysis, coming soon.
|Priya Chandarana is a Retail Analyst at IGD, specialising in research on the growing discount channel. To learn more about how IGD's research can benefit your business further, please get in touch - [email protected]