Morrisons credits loyalty scheme as sales decline slows

Morrisons says the launch of its loyalty scheme Match & More and the impact on the quality and volume of customer data helped to slow its sales decline and proved that its three-year turnaround is beginning to pay off.

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The supermarket saw sales at stores open for more than a year decline by 6.3% excluding fuel in the quarter to 2 November, an improvement on the 7.4% drop seen in the first half. Total sales fell 5.6% excluding fuel.

Morrisons says that while it “will take time for initiatives to fully benefit our sales performance” it does see “encouraging progress”. Average items per basket was down by 2.4% an improvement on previous quarters’ and on the low of 6.9% during the Christmas period last year (see table below).

Morrisons has also followed through on its promise to cut down on promotions in favour of investing in every day low prices. The number of items on promotion has fallen by 13.6% year on year while promotional participation is down by 2.4%,” it says.

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Dalton Philips, Morrisons chief executive, says: “Morrisons is meeting the challenges created by a period of intense industry completion and structural changes with quick and decisive action.

“The launch of the Match & More card was a big move for Morrisons. We are the only supermarket that is price matching the discounters and the successful launch last month was a testament to the positive way our 120,000 colleagues are delivering innovation and embracing the changes at Morrisons.”

Despite the positive signs, Morrisons remains the worst performing of the supermarkets. Tesco’s latest results saw a 4.6% drop in like-for-like sales, while Sainsbury’s fell by 2.8% and Asda saw its increase by 0.5%.

Meanwhile both Lidl and Aldi are experiencing double-digit growth, according to Kantar Worldpanel figures.

Christmas campaigns

Philips says that over the Christmas period, Morrisons will return to its message on quality fresh food and value for money, having focused on price cuts and every day low prices in its marketing so far this year.

Asda is the only one of the big four to reveal its Christmas ads so far, with the campaign focusing on the “genuine warmth” associated with Christmas. Tesco’s ad will run later this week while both Morrisons and Sainsbury’s will unveil theirs next week.

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