LONDON (Brand Republic) – A strategy of axing national advertising in favour of local ads and marketing, and investing in price promotions, is beginning to turn round Safeway’s fortunes.
The supermarket group claimed to have recruited 1m customers each week in the 12 weeks between April and June. Like-for-like volumes have risen 11%, like-for-like sales were up 5% and overall sales up 8.6%.
New chief executive Carlos Criado-Perez axed Safeway’s national TV ad campaign last year to focus instead on localised direct mail and plough more money into deep-cut promotions. The supermarket group also improved fresh food availability as well.
The Best Ever promotion was the major lure for shoppers defecting from rival chains, Criado-Perez said. “The programme is now bringing in more than 1m new customers each week – an 11% increase on last year.”
He said his controversial decision to axe the ABC loyalty card in June had not impacted negatively. “The new clients we have been winning over the last few months are staying with us.”
“Our ambition over the next few years is to at least restore Safeway’s profits to their historic peak level through strong sales-led growth,” he added.