Face-to-Face Consumer Interviews For Havering Council
After a year of sliding sales, the big four are cutting more prices in an attempt to regain ground before the year’s end.
Sainsbury’s, identified by the latest Kantar figures for “standout” growth of 1.2% (12 w/e 6 December) ran the highest number of promotions in the past four weeks. A 17.47% surge on last year’s deals to 2,911 left rivals trailing, with 11% more deals than Tesco’s 2,620 and 14.6% more than Asda’s 2,540 (Assosia 4 w/e 6 December).
Behind the top line, Sainsbury’s promotional mechanics have shifted in favour of straightforward price cuts. Some 81.24% of its promotions offered a saving (2014: 65.86%) compared with 18% of multibuy deals (2014: 33.09%). However, Sainsbury’s price cuts have become shallower with an average saving of 29.14% (2014: 32.04%) – the least generous among rivals.
Asda increased its deal numbers in a similarly dramatic fashion and ran 18.58% more than last year. But despite its EDLP rhetoric, Asda’s deals were the most likely to be multibuys. Some 43.78% of its offers used this mechanic, compared to 56.06% on price savings.
Morrisons ran 4.66% more deals than last year, with the extra coming almost entirely from doubling confectionery offers to 200 from 94.
As Christmas approaches, Tesco is the only big four retailer to offer fewer deals than last year. It had pinned some of its hopes on Black Friday, announcing that its 24-hour stores would close from midnight to 5am to give staff a chance to prepare. But Assosia’s researchers found the long sectioned-off path to enter the store almost empty and with many grocery fixtures replaced with uninspiring Black Friday deals.
Assosia MD Kay Staniland says: “Asda must have been giving themselves a pat on the back for their timely pull out.”
Tesco’s deals reduction is largely down to slashing its wine promotions to 136 from 232 and confectionery to 220 from 321. Bucking the trend, however, were spirits deals, up 41.17% to 288 to become the most heavily promoted category.
Waitrose, meanwhile, has become king of the bogof with 19.02% of its deals using this mechanic compared with 1.95% at Tesco and 4.65% at The Co-operative Group.
Staniland adds: “Asda, Sainbury’s and Tesco, along with the other grocery chains, really need to start looking at other options besides deep dive promotional activity to get consumers back on board. With each retailer claiming to price match at least one competitor, consumers are seeking something different – especially at Christmas. NPD is as important as a discount – so reindeer may not be everyone’s cup of tea, but it’s a talking point and will pique at least some shoppers’ interests to see what other goods are ranged. ”
|4 weeks to 6th December 2015|
|Number of offers||2540||860||2380||2911||2620||1220|
|Number last month||2535||857||2378||2870||2614||1216|
|% change m-o-m||0.20%||0.35%||0.08%||1.43%||0.23%||0.33%|
|Number last year||2142||873||2274||2478||2801||1185|
|% change on last year||18.58%||-1.49%||4.66%||17.47%||-6.46%||2.95%|
|Average start price (£) per UNIT||£3.51||£4.61||£4.51||£4.97||£5.17||£5.48|
|Typical Average TOTAL £ saving||£1.52||£1.72||£1.84||£1.55||£2.09||£2.26|
|Typical Average TOTAL % saving||29.89%||35.96%||36.21%||29.14%||32.40%||33.51%|
|Average % saving last month||30.09%||35.18%||36.47%||28.99%||32.25%||33.58%|
|% savings change m-o-m||-0.67%||2.23%||-0.69%||0.55%||0.45%||-0.20%|
|Average % saving last year||29.26%||36.71%||35.86%||32.04%||32.57%||31.11%|
|% savings change on last year||2.15%||-2.04%||0.98%||-9.05%||-0.54%||7.71%|
|Current Brand:own-label ratio||90:10||73:27||89:11||78:22||86:14||84:16|
|Ratio 1 year ago||90:10||75:25||88:12||74:26||83:17||84:16|
|Average % saving (branded)||30.90%||36.32%||37.12%||30.10%||33.49%||33.91%|
|Average % saving (o/l)||21.16%||34.99%||29.10%||25.66%||25.78%||31.41%|
Published in The Grocer, 17 December 2015