Morrisons says sales are up as offer is in tune with downturn

Morrisons value foodie approach was given a further boost today as the 4th biggest supermarket posted a 7.9% jump in sales compared to last year in the 12 months to February 1.

The supermarket says it will now take its brand from ‘national to nationwide’ via store expansion, with a target of 500,00 square feet in 2010/11. It adds the coming year will see 35,000 square feet more Morrisons retail space over and above the conversion of co-op stores it has already announced to fulfil its goal of becoming the ‘food specialist for everyone.’

The challenging UK economy would not hold the chain back new chairman Sir Ian Gibson told investors in his first city statement for the chain this morning (March 12), as it is “confident the Morrisons offer meets and is tune with the demands of our customers and the economic background.”

Morrisons increased its market share from 12.1 to 12.3% in the last 12 months according to TNS share. It says its Value range, which it re-launched this year, saw 50% growth in sales, while its healthy eating range Eat Smart grew by 13% and its organics sales were up 10%.

It says its marketing, on which it spent about 90m in 2008, continued to attract new customers by focusing on freshness, in-store production using “down-to earth” celebrities such as Richard Hammond. However it launched a “price crunch” campaign in April to ensure its value credentials were re-emphasised.

Morrisons marketing director Michael Bates told a recent Marketing Week brand summit the supermarket would not be creating online supermarkets in the short-term as the “online grocery sales have not yet been proven to be a profitable model.”