Fancy puddings, a new kind of fizzy wine, and the escapades of Mog the Cat all helped Sainsburys enjoy a strong Christmas in 2015.
The supermarket released a trading update on Wednesday morning, and the numbers confirmed Sainsbury’s position as the best performing of Britain’s ‘big four’ supermarkets. In total, sales excluding fuel improved by 0.7%, which may not seem like a lot, but in the ultra-competitive UK retail market, its a pretty solid performance.
Sainsburys has been the most successful of the UK’s major supermarkets in recent months, holding off competition from German discounters Aldi and Lidl. According to data released on Tuesday, it was the only one of the big four — Tesco, Morrisons, Asda, and Sainsburys — to grow market share in the month of December. It now has 17% of all UK grocery sales, according to Kantar Worldpanel.
Much of the company’s Christmas cheer can be put down to the success of its high-end ‘Taste the Difference’ range, which includes gourmet food and drink at a much higher price point than standard supermarket fare. Sales in ‘Taste the Difference’ products grew by 18% in the quarter.
The supermarket also had great success with its Christmas ad campaign, featuring Mog, a CGI cat who gets itself into all sorts of trouble. The ad was viewed 37 million times online, and a book accompanying the ad campaign was a Christmas best-seller, Sainsburys said.
Speaking about, the results, chief executive Mike Coupe said: “We have traded well during the festive period in a highly competitive market. Our stores delivered excellent levels of service and availability and we launched several new seasonal products and range improvements. As a result we have seen our market share grow in the quarter”
These are the key numbers from Sainsbury’s trading update, which covers the 15 weeks up to January 9:
- Total retail sales up 0.8%, or down 0.7% including fuel.
- Like-for-like sales (only counting sales from stores that were open this time last year) down 0.4%, or down 1.8% including fuel sales.
- Transactions in the seven days before Christmas improved by 2.6%, with more than 30 million individual transactions.
- 16 new retail stores were opened in the quarter.
- Christmas Eve was the company’s busiest ever day for sales in its convenience stores.
- Online grocery sales grew by 10%, with total orders up 15%.
- Sainsburys had a record week for online orders in the quarter, delivering over 289,000 in a single week.
- Like-for-like sales in the second half of the year are expected to be better than the first, thanks to the strong Christmas.
- Sainsburys sold 550,000 “Cognac Laced Christmas Puddings” over the festive period.
Earlier in January, Sainsburys had made an approach to buy Home Retail group — the owner of Homebase and Argos — rejected. The deal offer was thought to be worth in excess of £1.1 billion.
On Tuesday, big rival Morrisons reported its first sales growth in four years over the Christmas period, growing sales by 0.2%. City analysts had expected a 2% fall, so when the news dropped, Morrisons shares went nuts. The supermarket closed the day up by 9%.
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