Renewed or die. That is the philosophy that has led to Day to decide to give your stores a facelift to modernize their supermarkets and their own brand. A way to connect with the consumer who was being somewhat unfaithful lately and to put aside the not so good image of certain products of their own brand.

For this reason, for months he has worked on a change that is mainly based on his own brand. What does it consist of? In offering a more attractive commercial assortment in its white label, with new products and a varied offer.

That implies the renewal of the packaging with a more attractive and pleasant image. In addition, they have tried to insert the name of the chain on their packaging, as explained by the company.

For example, their white label vegetable drinks incorporate the name ‘Vegedia’ or in one of the products they have added, such as horchata, the slogan is ‘Plug in your day’. The changes can also be seen in other categories such as preserves, wine, milk, legumes, tomato … Although it is in beer where they are most proud, they tell Invertia.

This has led to the reformulation of the existing own brand with suppliers or to change suppliers in some cases to add a new product, as detailed.

White brand of Dia.

Sandra Tobar

The bet for the national product is also important. For this reason, from Dia they assure that milk production is now 100% from Spanish farms.

Changes in providers

Another big change is Dia’s relationship with its suppliers. According to sources in the food chain, long-term contracts are now being signed to generate greater “certainty” between them.

It should be remembered that when the opa on Day of tycoon Mikhail Fridman it had not yet been approved, many stores reported product shortages due, apparently, to the chain’s debit balance with some of them.

And the million dollar question: will Dia enter the price war with these changes? Well, in principle, company sources say that it is not in their plans despite the fact that the reason for their business is low prices. That war seems to be left to Aldi and Lidl.

These changes do not come alone. Dia is also immersed in its new franchise plan, is finalizing agreements with third-party suppliers to reach more towns and is building a huge logistics warehouse in Illescas (Toledo) to support its logistics.

One of the architects of this change is Santiago Martínez Lage, Corporate Director and member of the Management Committee of the food group who landed just a year ago in the company from Inditex, where he held the position of Deputy Secretary of the Board of Directors.

The keys to change

But why did you decide to launch this transformation? Experts have long pointed out that Dia needs a facelift in its stores and on its own products. The image of the brand with the largest number of stores in Spain – with 3,018 at the end of 2020 – was not the most appropriate for the consumer.

And in the pandemic, it took its toll. Despite having good data during confinement for his bet online and the proximity of its stores, suffered the overtaking by Lidl. The German chain snatched the third position by market share from Dia, reaching 6.1%. Dia lost 0.6 points to 5.8% market share. Apparently it was due to the loss of loyalty of its buyers.

“Dia has a strategic plan from the arrival at the direction of Ricardo Álvarez. He has a plan that will take years and a major reconstruction had to be done. It continues to reach 60% of Spanish households, it is the chain with the largest number of stores, although it is selling many and is close. You have invested in rebuilding the chain brand. The pillars are being laid ”, they pointed out from the consulting firm Kantar in relation to these data.

Although it is true, on the subject of its establishments, Dia has been looking for the best way to renew its image for years. In 2018, it launched Dia & Go, a convenience format, urban and with food to go to adapt to the new habits of consumers. Also a way to fight against Mercadona’s ‘Ready to Eat’ and the rest of similar services from its competitors.

But something was missing. And this renewal of its own brand has come to regain the lost consumer. The question is whether or not it will be enough. Time will tell.

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