John Lewis has given its continued backing to its “thoughtful giving” Christmas message as it posts upbeat sales for the festive season despite a difficult climate for high street retailers.
Sales at stores open for more than a year were up 3.1% in the six weeks to 30 December, with gross sales rising by 3.6% year on year to £1.03bn – John Lewis’s first ever billion-pound festive trading period.
At the John Lewis Partnership gross sales were up 2.5% to £1.96bn with Waitrose seeing gross sales up 1.4% and like-for-likes up 1.5%. That last number would have been even higher, at 2.2%, if the update included New Year’s Eve as it did last year.
Speaking to Marketing Week on a press call this morning, John Lewis’s managing director Paula Nickolds said the retailer is “very proud” of the campaigns it has run over the past few years. She highlighted that its Moz the Monster campaign this Christmas trended number one on social media worldwide and was the most viewed ad online, describing this as an “encouraging performance”.
“All advertising is designed so people see it. The number of views and talkability are important. The front of mind opportunity comes through those ad campaigns,” she explained.
However, there are many, in the ad industry at least, who believe the John Lewis formula is showing fatigue and could do with shaking up. While many of the marketers we spoke to praised John Lewis’s strategy, they also questioned if the formula is becoming “safe” and suggested there is scope to be “braver and bolder”.
Analysis of a range of Christmas ads for Marketing Week by Kantar Millward Brown also showed that John Lewis came just 13th in a list of 17 major retailers ranked according to which campaigns were most likely to get consumers to purchase, in part because there was “nothing new or different”.
However, Nickolds defended the “thoughtful giving” strategy that has helped John Lewis see a run of strong Christmas sales and made its Christmas ad a firm date in people’s diaries.
“Thoughtful giving as a theme is both a truth about the brand and, we hope, society. We are very proud of the campaigns we have run over the last few years. But of course every year we look at what our campaign should be about and we’ll do the same this year and reveal that in due course,” she explained.
Commitment to Never Knowingly Undersold
John Lewis’s strong Christmas performance comes despite a difficult environment for retailers that has thrown up winners as well as losers. The likes of Tesco, Morrisons and Next have done well, while Marks & Spencer had a more mixed Christmas and Debenhams, House of Fraser and Mothercare have been forced to issue profit warnings.
Amid that challenging environment, many retailers have resorted to discounting. And John Lewis, with its Never Knowingly Undersold brand promise, was forced to match some of those. That means, for example, it had to participate in Black Friday. And while it had a record sales hour on the day, Nickolds admitted “if [Black Friday] didn’t exist I wouldn’t invent it”.
Yet despite weakening consumer spending, the promotional outlook and rising inflation hitting profit margins, Nickolds said Never Knowingly Undersold will remain a key tenet of the John Lewis brand.
“This is a long-term commitment, decades old, that we have had through tough times and good times. Customers need to trust John Lewis in that respect and we are completely committed to it,” she concluded.