Sir; Liz Hamson (The Grocer, July 31, pp30-31) hasn’t quite got it right on the ‘exodus’ of Safeway shoppers.
Safeway’s sales growth was driven by the big weekly discounts on 100 or so high volume products. This programme was originally intended as a temporary expedient to increase customer transactions while the stores were being reformatted. The idea was that new customers would be attracted by the deals and would then shop for other, non-discounted lines.
After some initial success, the tactic began to run out of steam as many of the ‘cherrypickers’ who shopped mainly for the deals showed less and less inclination to buy anything else.
The reason was that most of Safeway’s non-discounted lines were adrift on price.A very sizeable chunk of Safeway’s sales had become dependent on the deals. So when Morrisons withdrew them, as it always said it would, there was bound to be a reaction. It will take time for the Morrisons offer and format to reverse the trend, but we may be certain the end result will be far more robust than what was there before.