Following today’s release of Morrisons’ figures for the 13 weeks ending 28th April 2024; Eleanor Simpson-Gould, Senior Retail Analyst at GlobalData, a leading data and analytics company, offers her view: “The fifth-largest grocer in the UK has maintained its Q1 momentum, reporting a 4.1% increase in Q2 FY2023/24 group like-for-like sales, just a minor 0.5ppt dip on its Q1 performance. Yet, given the weak comparative figure of +1.0% in FY2022/23, the retailer would have hoped to have demonstrated a more substantial increase this quarter, building on its improved sales trajectory from Q1. However, with Tesco reporting UK like-for-like sales of +4.6% for the 13 weeks ending 25 May 2024, a result not too dissimilar from its own, Morrisons will undoubtedly see this as a win after several years of market share erosion amid competition from the discounters. It is not out of the woods yet, as it will face stronger comparatives in the latter half of this financial year.
“Under the leadership of new CEO Rami Baitieh, Morrisons is taking a grassroots approach to solving the core issue plaguing the retailer during the cost-of-living crisis: its identity. The grocer reports it has taken on feedback from 340,000 stakeholders to pin down the key issues affecting its offer, which it has identified as being availability and its loyalty scheme. These findings are unsurprising given that the retailer has struggled to carve out a niche in a period marked by discounter price wars and intense loyalty scheme campaigning. Having announced in February of 2024 that it would price match to Aldi and Lidl, the grocer has been slow off the mark to capture transient consumers shopping around for the best prices. With its ‘Market Street’ heritage no longer serving as a unique selling proposition, Morrisons must swiftly leverage customer and employee feedback into its three-pillar strategy to introduce new and compelling reasons to shop at Morrisons.
“The supermarket has announced the successful conversion of McColls stores, expanding its Morrisons Daily convenience store format to 1,600 locations and setting an ambitious target of 2,000 by 2025. Despite these efforts to augment its presence in the convenience sector, with 114 McColls stores converted in Q2, the grocer has reported a meagre 0.7% uplift in convenience store sales for the quarter. As Morrisons continues to contend with the competitive retail landscape, it must ensure growth in its convenience store operations contribute substantially to its sales this financial year through its rapid-delivery partnerships with Amazon and Deliveroo.”
