Retailers are rejecting bogofs and other multibuy deals in favour of more straightforward price cuts as the battle to retain customers intensifies.
In the four weeks to 4 October, 44% of offers in the big four were price cuts, compared with 39% the previous month and 35% the month before, according to Nielsen analysis exclusively revealed to The Grocer. Bogofs and multibuys have traditionally accounted for the bulk of promotions, but price cuts were catching up, said Nielsen.
Morrisons has consistently reduced the number of multibuys on offer in favour of price cuts, which now account for 42% of its offers (in the four weeks to 4 October) compared with 28% in 2007. While Tesco and Sainsbury’s have also swung dramatically toward price cuts at 46% and 47% of all offers respectively, up from 35% and 39% in 2007, their strategy has been less consistent than Morrisons, according to Nielsen. Asda is the retailer with the fewest price cuts, although it too has moved in the same direction, with 36% of promotions as price cuts, up from 31% in 2007.
The retailer has always been less dependent on promotions because of its ‘everyday low price’ strategy. The retailer upped sales 8.3% year-on-year in the 12 weeks to 4 October, and increased market share from 14.7% to 15.4%. Morrisons has had the most dramatic increase in sales over the past 12 weeks, up 9.6% year-on-year, nearly double the 5.4% overall sales growth for the multiples.
Meanwhile, Tesco and Sainsbury’s saw sales growth of just 4.8% and 3.4% respectively. Multibuy offers now account for 45% of offers compared with 53% last year.
In the four weeks to 4 October, 44% of offers in the big four were price cuts, compared with 39% the previous month and 35% the month before, according to Nielsen analysis exclusively revealed to The Grocer. Bogofs and multibuys have traditionally accounted for the bulk of promotions, but price cuts were catching up, said Nielsen.
Morrisons has consistently reduced the number of multibuys on offer in favour of price cuts, which now account for 42% of its offers (in the four weeks to 4 October) compared with 28% in 2007. While Tesco and Sainsbury’s have also swung dramatically toward price cuts at 46% and 47% of all offers respectively, up from 35% and 39% in 2007, their strategy has been less consistent than Morrisons, according to Nielsen. Asda is the retailer with the fewest price cuts, although it too has moved in the same direction, with 36% of promotions as price cuts, up from 31% in 2007.
The retailer has always been less dependent on promotions because of its ‘everyday low price’ strategy. The retailer upped sales 8.3% year-on-year in the 12 weeks to 4 October, and increased market share from 14.7% to 15.4%. Morrisons has had the most dramatic increase in sales over the past 12 weeks, up 9.6% year-on-year, nearly double the 5.4% overall sales growth for the multiples.
Meanwhile, Tesco and Sainsbury’s saw sales growth of just 4.8% and 3.4% respectively. Multibuy offers now account for 45% of offers compared with 53% last year.
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