Greggs says its brand health and market share has “never been higher”, thanks in part to the investment the bakery chain has been making in marketing.
Its efforts have helped to enhance perceptions of the Greggs brand, the business claims in its preliminary results for the year ending 31 December 2022, citing the fact it ranks number one among the 44 quick service restaurants, coffee shops and delivery services tracked by YouGov’s BrandIndex.
Indeed, Greggs’ index score – a measure of overall brand health – improved from 23.8 in 2021 to 25 last year, achieving what Greggs says is its “highest ever” score. Costa Coffee trails in second place with a score of 16.8, followed by Pret A Manger (12.4), Caffè Nero (11.5) and Patisserie Valerie (9.7).
The former Marketing Week Brand of the Year’s marketing investment is also helping to increase the number of food-to-go shoppers considering Greggs and intending to purchase, with consumers now converting at a “record level” of 42%.
According to BrandIndex, Greggs’ consideration score improved by 4.2 points in 2022 to 36.3, putting the brand second in the rankings behind McDonald’s, which scores 38.4. Purchase intent improved three points to 15.3, pushing the brand ahead of Costa Coffee and into second spot, again behind McDonald’s at 19.8.
By continuing to nurture what makes Greggs special, I believe we are extremely well-placed to realise the opportunity to become a significantly larger, multi-channel business.
Roisin Currie, Greggs
Meanwhile, as consumers grapple with the rising cost of living, CEO Roisin Currie says Greggs has “worked hard to protect our reputation for exceptional value”, adding that this has been “central to our success”.
“Customers come back to us again and again because we offer great quality and great value. To maintain that positioning, we have focused on driving efficiencies to offset external cost pressures wherever possible and to mitigate the need for price rises,” she says.
“We regularly monitor our prices and our customer reputation for value to make sure that we maintain this important competitive position.”
The brand retained its number one position in the value rankings on BrandIndex last year, a rank it has held since the index started in 2013. Greggs increased its score by two points in 2022 to 37.1, with McDonald’s following in second with a score of 24.1.
All this has helped boost Greggs’ share of the food-to-go market, which now stands at 7.7% based on data from NPD CREST for Q4 2022.
“We want Greggs to be the food-on-the-go brand of choice for more people, more of the time,” Currie says. “Effective customer relationship management is crucial for this: our emails, text messages, web and app personalisation, and targeted social adverts help us to keep our customers informed and engaged. We continue to invest in and improve these as part of our digital workstream.”
Greggs has reported a 23% uplift in sales for the year to £1.5bn compared to £1.2bn in 2021. Meanwhile, pre-tax profit is up 1.9% to £148.3m versus £145.6m the year before.
The Greggs app is playing a crucial role in building loyalty, the brand says, through which customers can earn stamps and redeem rewards for their purchases. In the last quarter of 2022 the app had 1.1 million individual active users, up from 0.4 million in the same quarter a year prior, with customers scanning the app in 8.1% of company-managed shop transactions.
Some 1,270 Greggs stores now operate delivery services, amounting to 5% of sales last year. Delivery volumes are “normalising” as in-store volumes recover post-pandemic, but the business remains convinced there is a longer-term opportunity.Greggs praises ‘strategic progress’ amid ‘challenging’ conditions
Home delivery is now offered from approximately 80% of the business’s 500 late opening stores, which are open until 8pm or later. Post-4pm is Greggs’ strongest growing daypart, “albeit from a low base”, the business says, and in 2023 it plans to extend opening hours in 300 shops to 9pm. It will also trial 24-hour drive-thrus.
Greggs opened 186 new shops in 2022 and closed 39 last year, taking its total estate to 2,328. It continued its expansion in retail parks and Central London locations, such as Leicester Square, as well as key transport hubs including Liverpool Street Station and Birmingham and Liverpool airports.
It is planning 150 net openings in 2023, with its ultimate ambition to have “significantly more” than 3,000 shops in the UK.
Currie describes 2022 as a “year of strong progress” for Greggs, “the result of committed efforts to deliver our strategic growth plan”.
“The significant opportunities on which the plan is based will remain centre stage in the year ahead as we make Greggs more accessible to even more customers. Although consumer incomes remain under pressure, Greggs continues to offer exceptional value to people looking for great tasting, high-quality food and drink on-the-go,” she adds.
“We have an exciting, ambitious plan for the years ahead and, by continuing to nurture what makes Greggs special, I believe we are extremely well-placed to realise the opportunity to become a significantly larger, multi-channel business.”