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Promo Dynamic – Sainsbury’s quietly takes the lead in promo activity

The Grocer

While Price Guarantees continue to be the focus of the big two, Sainsbury’s has gradually stepped up promotions. In January this year, while Asda and Tesco fought it out like cats and dogs over the former’s Price Guarantee, there was one retailer keeping its head down and quietly getting the job done.

Sainsbury’s, better known for quality than price, and often occupying fourth place for price in The Grocer 33, launched 974 half-price offers to help shoppers through what CEO Justin King described as a “pressing time” for finances.

And as rival supermarket chains have continued to come to blows over Price Guarantees and Double the Differences, the latest data from Assosia shows that Sainsbury’s has ramped up its promotional offering still further.

Both month-on-month and year-on-year it is, surprisingly, the retailer to have offered the most promotions to customers. And it is some distance from its rivals in both respects. In the four weeks to 17 April, it upped the number of promotions by 8.2%, or 161 deals one of just two retailers to increase its level of offers during the period. Year-on-year, promotions at Sainsbury’s rose 19.1%. X-for-y was the most popular promotional mechanic at the chain, reflecting its strategy of offering deals across the board.

The latest success has been its 5 Family Meals for £20 initiative, which ran earlier this year but is still gathering rave reviews on ­social media sites such as Facebook. As well as the volume of deals, Sainsbury’s also scored highly in terms of the savings it offered. The chain offered the second-highest average savings at £2.18, just behind Tesco, which had an average saving of £2.31. Tesco, however, ran 180 fewer promotions than a month ago.

Last month, The Grocer revealed that Asda was finally weaning itself off heavy promotions. At the time it was the only chain to reduce its offers. It broadly stabilised its position, upping promotions by just five offers, to 1,574. Year-on-year, it upped its offers by 15.3%. In terms of category promotion, with the supermarkets gearing up for the Easter break, the Royal Wedding and two extended Bank Holiday weekends, it was hardly surprising to find the greatest number of deals in the confectionery aisles, and they rose 3.3% year-on-year. Alcohol deals followed confectionery as supermarkets ensured that the British would be able to stock up on booze to toast the Royal couple. Wine promotions were up 0.9% year-on-year, followed by beer and lager, up 1.2%.

Published in The Grocer, 30 April 2011