Sainsbury’s won over more shoppers this festive period, winning market share for its sixth consecutive Christmas.
Grocery sales increased 5.1% in the six weeks to 3 January as the supermarket sold 20% more turkeys in Christmas week, according to a third-quarter trading update out this morning.
Sainsbury’s said its investment in value and Nectar Prices drove higher shopper loyalty and bigger trolleys in the period.
Customers saved an average of £27 on their big Christmas shop this year from a combination of Nectar discounts and personalised offers, with record participation for the retailer’s loyalty offer.
Fresh food sales rose by 8% in the group’s third quarter, while Taste the Difference increased sales by 15% and proved to be the fastest-growing premium own-label range in the market.
Online also increased sales 14% in the quarter, with bigger basket sizes and “a big step forward” in customer satisfaction on availability.
“More customers switched to Sainsbury’s, trusting us for both great value essentials and premium Taste the Difference products in their big Christmas shop and we were the only major grocer to grow items in the basket,” said CEO Simon Roberts.
“We gave customers great value on a bigger range of products this year and more customers benefited from personalised Your Nectar Prices, available to every supermarket shopper for the first time.”
He added: “We expected the market to become more competitive with customers spending more carefully, and we invested in balanced choices to offer great value for money, outstanding quality and innovation and leading customer service and availability, both in store and online.”
Overall retail sales growth at Sainsbury’s came in at 3.3% in the six-week Christmas period, following a 2.2% decline at Argos and a 1% in general merchandise and clothing.
Grocery sales in the 16 weeks to 3 January increased 5.4%, while GM was down 1.1% and Argos declined 1% to give a total rise for the group of 3.9% in the third quarter, with like-for-like sales up 3.4%.
Despite volume growth, Argos was hit by lower average selling prices across the market as shops tried to tempt consumers to part with their cash over the golden quarter.
Sainsbury’s upheld its guidance for more than £1bn in underlying operating profits for the full year despite the weaker market condition in general merchandise. And it raised forecasts for free cashflow from more than £500m to in excess of £550m.
“We have real confidence in our momentum as we head into the final quarter and remain focused on helping our customers get great value for money and delivering for all our stakeholders,” Roberts said.
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