Migros, one of Switzerland's largest retailers, is planning to reduce prices on 1,000 everyday products to very low levels by the end of 2025. This initiative, which involves investing half a billion francs over the next five years, is being funded through savings and the sale of underperforming divisions.

Concerns about the low-price strategy

Some experts are concerned that this low-price strategy may erode trust in the Migros brand. They argue that while lowering prices may appeal to consumers, it risks positioning Migros as a direct competitor to discount retailers like Aldi and Lidl. Retail experts suggest that Migros should focus on its core values of providing good products at reasonable prices rather than simply slashing prices to compete with discount chains.

The shift towards a low-price strategy has also led to criticism of Migros' communication and overall brand strategy. Experts argue that Migros should avoid unnecessary scrutiny from consumers by lowering prices without making a big announcement. The introduction of yellow price tags to signify discounts has also drawn scrutiny, as it does not align with Migros' established brand identity. Experts suggest that Migros should consider a more cohesive branding strategy that resonates with its heritage and customer expectations.

Challenges and suggestions for Migros

Migros plans to increase the proportion of its own products in stores, including those under the M-Budget line. However, experts caution that offering these products at significantly lower prices may be challenging. Migros must adapt to changing consumer preferences and technological advancements. Experts suggest that Migros should focus on enhancing the customer experience through digital solutions and prioritize customer convenience and health-focused offerings.

Additionally, Migros should strive to evoke feelings of solidarity and pride among its shoppers to enhance brand loyalty and mitigate the risks associated with its low-price strategy. Overall, while Migros' plan to lower prices may attract attention and increase foot traffic, the long-term implications for brand trust and identity remain uncertain. Migros will need to balance competitive pricing with its core values and customer expectations to maintain its position as a trusted name in Swiss retail.