Sainsbury salutes Royal Wedding as sales rise

The supermarket's sales are up, thanks to copious bunting sales (amongst other things). But it could do with another double bank holiday...

by Emma Haslett
Last Updated: 06 Nov 2012
It may feel like a distant memory now, but retailers are continuing to reap the rewards of the Royal Wedding. The latest to benefit is Sainsbury’s, which, thanks to Wills’n’Kate, saw like-for-like sales rise by nearly 5% in the three months to June 11, while sales excluding petrol grew by just under 2%. After less-than-stellar figures for the same period from Tesco, it’s a good indication that Sainsbury’s is on the right path. But despite its strong performance, it says that the next few months won’t be such a breeze…

Interestingly, given the fact that Tesco blamed some of its poor performance on a drop in demand for consumer electronics, Sainsbury’s said sales of general merchandise and clothing actually grew faster than food, with weekly transactions up by 5% to £22m. Apparently, it managed to flog 300 miles of bunting, 159,000 flags and 49,000 mugs – not to mention more champagne outside Christmas than ever before. And one of its biggest sellers was The King’s Speech DVD, where Sainsbury’s became the number one retailer, achieving more than a third of the market share in the week of its release. Clearly ardent royalists shop at Sainsbury’s.

So what differentiated Sainsbury’s from Tesco? Well, perhaps its customers tend to be slightly better off, on average – so they’re more likely to treat themselves, particularly when there’s a Royal Wedding to celebrate. And Sainsbury’s has also been coming up with new ways to increase its market share, with innovations like its ‘click and collect’ service, for example; this allows customers to shop from the comfort of their home then pick up their purchases later, thus avoiding the unpleasant prospect of having to mingle with the hoi polloi at the supermarket. The service was expanded to 240 stores last quarter, and it’s planning to roll it out to 800 by Christmas.

But Justin King, the supermarket’s CEO, warned that without the Royal Wedding to boost sales, the next few months look tougher. Many of its customers have already started trading down to its own-label ‘Basics’ range; in fact, Basics now takes up 22.3% of the ‘value’ market share. ‘The market remains very competitive,’ he said. ‘We expect this to be the case throughout the year.’ Tactfully put.  

The good news, of course, is that the Queen’s Diamond Jubilee next year could produce a similar reaction from consumers. But until then things look a little bleak. Maybe King is hoping for a surprise bank holiday in between – a shotgun wedding for Harry and Pippa, perhaps?

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