Asda outlines plans to reverse slowing sales
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Asda will ramp up its investment in price cuts after finding that is what matters most to its core customers, mums, a move that comes as the Walmart-owned supermarket reports a slowdown in sales.
The retailer says it will continue its “relentless” focus on price and will add more layers to the Asda Price Guarantee, which already pledges to be 10% cheaper than other supermarkets. Asda claims that 500,000 customers a week check the cost of their shopping using the guarantee each week.
It will also extend price cutting strategy “Rollbacks” and pricing technique “round pound”, which sees prices set as pounds only.
It is also introducing an online budget tracker that will help mum’s create a personal household budget to track finances. All measures are designed to be transparent and help mums manage weekly budgets.
An Asda spokesperson adds that: “We know that our customers aren’t looking for hit and miss gimmicks and promotions. When they have £60 in their purse for the weekly shop – they want to know they can buy what they need for the family – week in, week out.”
Measures come as Asda publishes its first ‘Mumdex’ report - a survey of 4,000 mums on family life, finances and the future - and found that offering products at the best possible prices was ranked as the most important issue by 90% of mums.
The supermarket intends to use the report, which will become a quarterly survey, to inform and shape future business decisions.
It posted a 0.1% rise in sales in the final quarter of the year, compared to a 1.3% rise in the previous quarter, showing a marked slowdown in sales. Asda’s performance is, however, better than market leader Tesco, which reported a 1.3% fall in the final three months of the year.
Asda also unveiled measures to further improve the quality of its food. It will continue its partnership with high-end cookery school Leiths to launch a premium Easter lunch promotion that aims to replicate the success of its speciality Christmas range.
Asda’s 2012 investment plan inlcudes:
£2m in fresh fish counters - extending its Chosen by You brand to the fishmonger.
£4.5m in a “Community Life” programme that aims to allow local groups to use store facilities such as training rooms.
£15m investment into quality of meat under the Butcher’s Selection brand, extending it beyond beef to pork and lamb.
1,000 new product lines under the Chosen by You own label brand in 2012
Readers' comments (2)
Carrie Grafham, Different Size Feet (a division of | Wed, 22 Feb 2012 1:09 pm
Asda’s decision to put mothers at the heart of its marketing strategy is no surprise; there is little doubt that as the main shoppers and decision makers for family purchases, this level of insight can be very powerful.
What is commendable is Asda’s willingness to look beyond shopping behaviours to social trends. Whilst appearing to be unrelated these trends often have a profound effect on the nature of a consumer’s bond with a brand, through a broader understanding of their lifestyle.
However, it would be interesting to know how the sample for the Mumdex panel has been profiled; the assumption being that it’s representative of the existing Asda demographic. If so, caution is needed to avoid the temptation to extrapolate the findings to all mums.
Equally has Asda considered identifying those mums with the most influential clout? In a world where brands need to rely increasingly on word of mouth both on and (more crucially for this audience) offline, our research shows that it is a certain type of woman across all social classes who is shaping others’ attitudes and preferences, much more than any form of brand communication. Understanding these women and how, when and where they influence is key not only to gaining valuable insight into the development of social trends, but also to creating a WOM strategy that goes beyond the mummy blogger and into the real world.
Research white paper can be downloaded from www.differentsizefeet.com
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Tiina, Dorking | Wed, 22 Feb 2012 2:07 pm
Asda has been caught napping by retailers such as Lidl and Aldi, which offer better quality products at lower prices.
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