Safeway shoppers couldn’t care less about the loss of the supermarket chain, according to an online survey carried out exclusively for The Grocer by market researcher HI Europe.
With just over a fortnight to go before the Safeway/Morrisons merger goes through, 4,537 shoppers were asked how they felt about supermarket brands and whether the loss of the Safeway brand would influence where they shopped.
Almost half of the Safeway shoppers surveyed (45%) said they were not bothered about
stores becoming Morrisons and 35% were in favour of the move.
Just 13% said they would prefer stores to remain as Safeway and 5% that they would stop shopping at the store if it was re-branded. Were the situation to be reversed, however, 38% of Morrisons shoppers said they would prefer stores to continue as Morrisons.
HI Europe research manager, Karen Jepson, said that the survey highlighted weak consumer loyalty to Safeway.
“It is not surprising to find that principal Safeway shoppers offer little resistance to a rebranding.
“But Morrisons shoppers appear somewhat less accepting of the Safeway name and when citing the perceived strength of the brand, Morrisons shoppers are considerably more engaged with Morrisons than Safeway shoppers are with Safeway.”
There was still a lot the multiples in general could do to instill brand loyalty, she added, as only a third believed that supermarket brands stood for anything and most shoppers cited the primary reason for not shopping at a particular store as lack of proximity rather than active preference for a rival.
The findings came as speculation mounted over the possible disposal of 138 smaller Safeway stores. A City analyst maintained Morrisons was sounding out buyers for the stores, which have a £1.12bn turnover according to figures that were presented to the City in December.
He put the price tag at £200m to £300m based on recent supermarket disposals, but said the value would depend on the percentage of freehold. He said there were “likely to be loads of venture capitalists” looking at “cleaning it up and getting an operation that’s sellable”.
Morrisons declined to comment, but a source close to the retailer said that while disposal of the stores was possible, it was “not a priority”.
A source close to Safeway added: “You’ve got to ask who would Morrisons sell to bearing in mind the restrictions in the Competition Commission report. And don’t forget they’ve got 52 stores to dispose of as a priority.
“And Morrisons has said on the record that most of the smaller stores are profitable.
“I think selling them off as a job lot is highly unlikely.”
Liz Hamson