Sainsbury's attributes profit rise to 'values-driven' brand strategy

Sainsbury's said its focus on "high-quality, affordable" own-brand products and its Brand Match scheme have helped propel sales, as the supermarket revealed half-year profits are up 9.1% year on year to £433m.

Sainsbury's: half-year profits reach £433m
Sainsbury's: half-year profits reach £433m

The retailer, which today unveiled details of its Christmas ad campaign, continues to outperform its rival supermarkets and now boasts a 16.8% share of the UK’s grocery market – its highest in a decade.

Sainsbury’s total sales for the 28 weeks to 28 September, including VAT and fuel, reached £13.95bn, up 4.4% on the previous year, marking 35 consecutive quarters of growth for the supermarket.

The company said its 'Live Well for Less' marketing strategy was proving a hit, with sales of its own-brand products growing at twice the speed of branded goods.

Its newly redesigned Taste the Difference range is showing double-digit growth, it claims, although sales of Basics products experienced "marginal decline".

A "compelling" general merchandise and clothing strategy was fuelling growth at "around twice the rate" of food sales, while online grocery sales are up 15% year on year, accounting for over £1bn in annualised sales.

Chief executive Justin King believes the success can be attributed to Sainsbury’s "values-driven" culture, following its high-profile dispute with rival Tesco over its price comparison scheme:

He said: "We are helping customers ‘Live Well for Less’ through high-quality, affordable own-brand products, Brand Match, Nectar and targeted coupon-at-till promotions.

"Whilst customers' budgets remain tight and any recovery in the economy may take time to take effect, our consistent strategy and strong values-driven culture mean we are well placed to continue to deliver for customers, colleagues and shareholders."

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