Sainsbury’s woos back ‘secondary’ customers

Sainsbury’s has “done the heavy lifting” on pricing and is now reaping the benefits of a much more competitive positioning vis-a-vis its rivals, according to the supermarket chain’s CEO.

Why it matters

“We’ve been absolutely focused on converting a pricing position that three years ago was too high,” CEO Simon Roberts told an earnings call. Citing Kantar, Nielsen and the Grocer, he said the brand is now the cheapest of the full choice supermarkets and has closed the gap on discounters like Aldi and Lidl. 

The result is that “customers are trusting us more” and that is translating into growing customer numbers, especially among ‘secondary’ customers who were buying a few items but not doing a full-basket shop. 

Takeaways 

• The April launch of Nectar Prices on 6,000 grocery products brought in 3 million new sign-ups to the loyalty programme. 
• Sainsbury’s avoided additional sales-driving activity online to focus instead on improving the online experience.
• The business earned £97m in marketing and advertising income from suppliers in the year to March 2023. For the 28 weeks to mid-September the figure was £59m; the full-year figure is likely to exceed 2023 as the supermarket doubles the number of in-store digital screens. 

Key quote

“Customers can see that our value is strong. They can see it’s consistently strong. And as a result of that, whilst they’re still being cautious, they’re spending more of their basket in Sainsbury’s” – Simon Roberts, CEO of J Sainsbury plc.

Sourced from Seeking Alpha

[Image: Sainsbury's]