Originally Posted by Land-of-Miles

I would argue that it isn't coincidence that Waitrose et al have been gaining customers as Aldi etc. have been growing. It could be argued that Tesco etc. has simplistically focussed upon the value end of the market to counter the perceived threat from the discounters whilst ignoring the fact that this turns off many customers who wouldn't be seen dead shopping at Aldi.

In effect the Tesco approach to focus upon price has pushed away high margin customers to upper end competitors and concentrated dependency upon very price sensitive customers. You can clearly see the argument that this is exactly what BA has been doing too and with similar consequences.