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The retail animal

Published:  23 July, 2008

Alex Anson, it seems, didn't have your usual boyhood ambition: there were, for him, no dreams of lifting the World Cup, landing on Mars or saving the world; he never saw the appeal of being a fireman or a train driver. The young Anson had other ideas. What he wanted to be more than anything else in the world was, of all things, a wine retailer.

The precocious Anson, the son of a Spanish father and an English mother, spent the first years of his childhood in Spain and discovered his mtier on his very first trip to England. It sounds a bit cheesy, I know, but there's no bullshit about this, no hype, I promise you,' he says, aware of how unlikely his story seems. I was born in Rioja and lived there until I was nine, and I would always go back there for holidays. I had experience of wine from an early age, helping my grandfather with pruning and cleaning barrels at the family vineyard. When I first came to England, when I was nine, I remember going into off-licences and seeing the wine range, particularly the Spanish wine range, and feeling sorry for UK drinkers. And this may sound daft, but I thought maybe one day I could help consumers get a better offer of wine, of Rioja.'

Some 20-odd years later and, as the man responsible (as trading director at the Thresher Group) for the range and trading strategy of the UK's largest off-licence chain, Anson is surely in as good a position as anyone to fulfil his childhood dreams, daft or otherwise. Indeed, cynics may wonder if the only reason he took the job 18 months ago was because there was so much room for improvement at his new employer - things were so bad, surely he couldn't do any worse. Certainly, at the time (and we'll get to the now a little later), the Thresher Group range was no better, possibly worse, than those that so motivated the nine-year-old Anson. As Anson admits, Everything we [at Thresher] had done in the previous three years was almost simplifying to the lowest common denominator. Everybody could see that [the range] was dumbed down. 12 months ago I would have struggled to buy wines from our stores.'

You and everyone else, Alex. The perception of Threshers in the trade, and among much of the wine-buying public, had never been as low as it had when Anson's boss, Thresher MD Roger Whiteside, assumed control 18 months ago. Andrew Jefford, writing of his local Thresher in Harpers last month, eloquently summed up the discontent that still lingers around much of the estate: This is the heir to the wine-buying traditions of people like Kim Tidy at Thresher and Wine Rack and Thomas Woolrych at Victoria Wines: a great, high-effort tradition, a tradition of trying to bring wine in all its joy and diversity to ordinary shoppers in ordinary high streets. All of that has been totally junked by a head office that only seems interested in trousering the bribes offered by big-brand owners.'

Three into two

So why did Anson swap successful Tesco - where, after the best part of a decade in the drinks department, his star was still rising - for failing Thresher? I was minding my business at Tesco, and I was made an offer I couldn't refuse,' Anson explains. I had seen for a number of years that Thresher and the rest of the multiple specialists had been declining, and so I consulted with a few key industry figures and they said, "Well Alex, if anyone's going to turn around the sales performance at Thresher, you're the man." It was a challenge that was too good to miss, and I wouldn't have been able to make as big an impact at Tesco as I have at Thresher.'

So far, Anson's impact has indeed been big, and it can be summed up in just three little words: three for two, the deceptively simple promotional mechanic that, since it was applied to every wine sold in the estate, has, according to Anson, transformed the fortunes not only of his company but of the whole multiple-specialist sector. For the first time in my history, the multiple specialists are growing faster than the multiple grocers, as far as wine is concerned,' he says. You have to pinch yourself when you read the [Nielsen] figures: high double-digit like-for-like growth. For a business that's been in decline for 10 years, that's amazing. Staff like it and our customers love it.

They're buying more wines, and they're buying more expensive wines.'

Anson is understandably proud of the figures, not least because they have helped him to see off some of the early critics of the idea who wondered, among other things, whether the higher single-bottle prices required to fund the offer would alienate Threshers' core consumers. From his position of strength, brandishing his statistics, Anson concedes that he might have lost some single-bottle consumers, but we have replaced them with destination shoppers bulk-buying. But if you're only point of difference is convenience, I don't believe that's enough any longer. The most convenient retailer is Tesco, which has not only got 600 superstores but also has 500 convenience stores in the right locations.

There was some [negative] feedback in the early days [of the promotion],' he continues. But if I'm honest with you, we are always slightly more expensive than the multiple grocers. In many ways, all we've done is say that we want to get cheaper; but if all we do is drop our bottle prices, then all we're going to do is drive deflation and put less money in the till, and that's not going to be profitable business. But if we can get cheaper by getting people to buy three for two, the equivalent bottle price is one of the cheapest in the market. You could pick 20 SKUs [from our range] and do a price comparison using the three-for-two equivalent price and a single bottle from Tesco or Sainsbury's, and we would be quite proud of how the prices stand up. But we can only do that on a deal, otherwise it doesn't work for us.'

So Thresher is happy. And apparently its consumers are happy. But what about that other, crucial, part of the equation: suppliers? How do they feel about being on promotion not just part of the time but all year round? How do they afford it? After all, even Rosemount is sold off-promotion some of the time. Anson admits that he had to fall back on the good will he had earned with suppliers during his time at Tesco to persuade them to come on board with 52-week three-for-twos. But there were incentives, too - not least the reduction of Thresher's notoriously high margins, which had risen to 45% under the previous management. We've made a huge investment in terms of our margin expectations in order to land this,' Anson says. I don't want to compromise the confidentiality of our commercial terms, but in essence what we've reached are annual agreements with suppliers that allow us to channel the investment into a simple solution that allows [the suppliers] to focus on the volume they are delivering and not theday-to-day deals.'

On the Rack

Headline-making though the three-for-two deal may have been, there is more to Anson's plans at Thresher. Just as close

to his heart, and closer to the ideals of his youthful self, has been his desire to overhaul the range - a task that, he says, has taken his wine-sourcing managers Jonathan Butt and James Griswood nine months to get right, and that features

wines from both existing and new suppliers and will be regularly topped up with interesting' small parcels. Anson reckons the new range is particularly strong in Australia, New Zealand and Champagne/sparkling wine, and he adds that the team has made a real effort to revivify an area in which he felt they were particularly weak: France.

Many (but not all) of the new wines are earmarked for the 200 new' Wine Rack stores, a fascia that has made a Lazarus-like return to life under Whiteside and Anson after the previous management had tried to consign it to history. For seasoned Thresher-watchers, the announcement of the return of the Rack was the cue for a chorus of here we go again'. Wasn't this just another of the company's famous U-turns, to be filed alongside its failed flirtation with food retailing and convenience'? Not at all, is Anson's response, naturally. Wine Rack and the two other fascias that will share the remaining 1,800 stores in the estate - Thresher and The Local - are the outcome of a lot of hard thinking about the role, and the chances of survival, of the multiple specialist in the age of the multiple grocer. You can't tackle the multiple grocers at what they do head-on,' Anson says. You have to make a point of difference, whether it's through the range, the service or a customer proposition like pricing or promotion. It doesn't necessarily mean you use the same solution for all your consumers and stores, as we'd been trying to do in the past. Where we've come from is to understand our estate versus our consumers and make sure we've got the right proposition in each of those stores through the three fascias. For The Local, which is a much lower demographic, it's all about making sure you've got a much more branded portfolio in terms of names that consumers know and trust, and a much more aggressive trading platform with much more aggressive pricing and a level

of service appropriate for that consumer.

At the other extreme, in Wine Rack, consumers have got a much higher expectation of service, wine range and

wine knowledge, and we've got some 200-odd stores that fit this bill.'

The new-look stores, though smart and (judging by the store I visited in Cobham, Surrey) much improved on their previous decor, have been made over with the minimum of fuss and investment; Anson says that Thresher is more interested in investing in their range and getting all the branch managers WSET-trained than in paint jobs. The range itself is designed to

be interesting but not intimidating. I find Oddbins quite hard to shop at, and I think a lot of consumers do, too. Yes, they've got an interesting range, but I think it's too hard to shop for the majority. We wanted an offer that was balanced between the brands that still hold consumers' hands, without being too branded, and with a lot of interest. And the price points we're pitching at are not 12-15: we're trying to hit that sweet spot between five and seven quid, and there are a few people who will go up there on price. I'm really pleased with what we've done in terms of range.'

Anson is under no illusions about the kind of customers who will be attracted by Wine Rack - this is no Berry Bros & Rudd. All the same, there will be a fine-wine presence in store, thanks to Thresher's novel tie-up with Lay & Wheeler, which provides branded units featuring higher-priced wines from its own agency portfolio. Does this in any way undermine Thresher's credibility when it comes to sourcing fine wine? We'd thought about those risks, and we could source those wines ourselves, but I think it adds further credibility to our stores when consumers see the heritage of Lay & Wheeler. Where we're trying to be aggressive is the New World - and to have the same level of credibility that Lay & Wheeler has in the Old World with our New World selection. Fundamentally fine-wine consumers will not come into our stores. We wanted to bring fine wine to the masses in a very convenient way.'

It's a very Anson sentiment. Years at Tesco have clearly left their mark on a man who has as much admiration for the blending skills of big-branded winemakers such as Jacob's Creek's Phil Laffer as he does for crafters of fine wines from single vineyards - a man who clearly relishes working in the mass market. Indeed, despite now being a relative retailing David rather than a Goliath, he has no time for criticisms of his former employer's increasing power. The truth is that there is a lot of wine and a lot of retailers, and we're all consenting adults in terms of what we buy at what price and where. The success of Tesco is that it's heard what the customer wants and delivered it for them ahead of some of its competitors. Tesco has found it challenging because its tried to beat Asda on price and Sainsbury's on high-low promotions. It's a tough strategy, but Tesco has been successful at doing it.'

In fact, Anson is so enthusiastic about Tesco that one wonders if he would still be there if the top job in the BWS department had come up. Certainly you wouldn't rule out his returning to Cheshunt one day, if the offer was right. He calls his time there an amazing experience, it was always so customer-focused I'm young enough at the moment to say, "God knows what life will throw my way!" I never set out to work for Thresher, but here I am and I love it. I love working in BWS. I love the challenges and the rewards of retail, and I love wine. I'm a retail animal.' Man and boy.