BUSS4 UK Recession - More Profit & More Customers - How Sainsburys Did It

Grocery retailer Sainsbury’s have increased net profit by 17% and added 1 million customers since the start of the economic downturn. How did they do it?

An interview with Sainsbury’s Marketing Director here in Marketing Week helps provide some of the answers - some excellent examples here too for AQA BUSS4 students wanting to add to their research notes.

Key points I picked up from the interview include:

- Marketing aim - to help customers change the “way” they shopped rather than “where” they shopped - i.e. to hold onto market share rather than losing share to the growing budget retailers. This one is really important for students. Customer loyalty is vital in the intensely competitive grocery market - supermarkets had to respond to the growing demand for lower-priced goods at a time when consumer confidence was lower

- Clear segmentation of the different own-label product ranges - making full use of the marketing mix to differentiate each of the three own-labels

- Attractive sales promotions on popular branded goods (working in partnership in doubt with the branded food producers)

- Greater use of money-off vouchers (as an alternative for customers who dont use the Nectar loyalty scheme)

- Advertising focus on fresh food and quality