Morrisons struggles to differentiate in a crowded market

Morrisons: dropped celebrities
Morrisons: dropped celebrities

Earlier this month, Morrisons, the UK's fourth-biggest supermarket by market share, posted a disappointing set of third-quarter results, revealing a decline in like-for-like sales.

It also announced the departure of commercial director Richard Hodgson, who joined from Waitrose in 2010.

Morrisons chief executive Dalton Philips has blamed its lacklustre performance on the brand's failure to differentiate itself from competitors, and emphasise its 'fresh' offering, saying it needs to focus on its staff of more than 5000 butchers, fishmongers and bakers.

He has briefed Hodgson's interim replacement, Morrisons corporate services director Martyn Jones, to ensure that the supermarket communicates its points of difference and improves its promotions.

The retailer, best known for its value offers, has also come under pressure from rivals' money-off voucher promotions. Some analysts have suggested that one of the biggest challenges it faces is connecting with its core customer base and value roots. Morrisons' move to introduce 'extras' to many of its stores, including pizza counters and cake shops, has distanced the brand from its most loyal shoppers, they argue. The supermarket has also come under fire for introducing a 10%-off discount card offer in selected towns, designed to tempt in new customers.

How can the supermarket reconnect with its core customer base, and what does it need to do to strengthen its marketing messages and promotional tactics? Marketing asked Claire Harrison-Church, former director of brand communications at Sainsbury's, and Karen Buchanan, chief executive of Publicis London, which previously handled the Asda account.

MORRISONS STATS

Like-for-like sales (excluding fuel) were down by

2.1% for the 13 weeks to 28 October

Total sales dropped by

0.4%

Source: Morrisons

CLAIRE HARRISON-CHURCH - Former director of brand communications, Sainsbury's

Morrisons' failure to communicate its offer to consumers, and changing that offer, are the issues here. If you ask Morrisons' shoppers what they love about it, they will immediately talk about its fresh-food offering, in particular the meat and fish counters. Push them further, and they will also comment on its other enticement: deals, and good ones - it pioneered the 'Buy one, get a trillion free' type.

Morrisons has got two things wrong in the past 12 months. It has stopped talking about its core proposition, fresh food that delivers value, and pulled back on promotions and depth of discount. It has also lagged behind the field in convenience store and online, which have been growing, as customers realise they can use these to better control their budgets.

REMEDY

- Get back to talking about 'Fresh choice for you'. The key is to talk about fresh and value together.

- Review promotions. By understanding who your customers are, you can offer good deals on key items.

- Have a consistent tone of voice - the surreal Christmas TV ad doesn't 'feel' like it's from Morrisons.

KAREN BUCHANAN - Chief executive, Publicis London

Arguably, the opening words of Morrisons' Christmas campaign, ('And so it begins. There's so much to do... '), neatly sum up the position in which the supermarket finds itself: sales down by 2.1% alongside several changes in its marketing and management teams.

Dig deeper, however, and there is lots to celebrate: Dalton Philips, chief executive since 2010, has cracked on with revamping the offering. Recent reports suggest that stores at the forefront of this process are already outperforming the rest by more than 5%.

With new marketing chief Rebecca Singleton in place, there is reason to believe that the brand will begin to radiate more of the product promise that has been put in place.

REMEDY

- Broadly, Morrisons should hold its nerve.

- 'Fresh' is a good platform, but has to extend beyond the literal for product and promotion.

- Promotions: in tough times, punters embrace life's little comforts, and Morrisons' promotions should embrace this.

Discussion

Before commenting please read our rules for commenting on articles.

If you see a comment you find offensive, you can flag it as inappropriate. In the top right-hand corner of an individual comment, you will see 'flag as inappropriate'. Clicking this prompts us to review the comment. For further information see our rules for commenting on articles.

comments powered by Disqus
Brand Republic Jobs

subscribe now

Latest

Oasis #springasmile digital campaign gets people doing good deeds
Coca-Cola: 'Don't approach bloggers with a fait accompli'
Tesco CMO Matt Atkinson: 'It is so important not to stereotype mothers'
McDonald's gives Ronald a new look ahead of global 'Fun times' social media push
In pictures: BrewDog opens first craft beer shop BottleDog for 'beer aficionados'
Facebook ad revenue leaps $1bn as it invests in targeting
Malteser or Maltesers? Mars takes Hershey trademark dispute to court
Apple Q2 profits top $10bn as iPhone sales soar
Lynx tells men not to leave love to fate
HBO captures awkwardness of watching sex scenes with parents
Primark to open first US stores with Boston chosen as flagship location
Marketing spend on the up but a reality check is needed before celebrating
Top 10 ads of the week: Jackpotjoy and BT Broadband fend off Kevin Bacon
Lidl beats Tesco to 10m Facebook fans
Center Parcs ad banned for encouraging parents to take kids out of school
Coca-Cola, Cadbury and Amazon named top brands for targeting youth market
Leaked document shows Nokia to be rebranded as Microsoft Mobile
Nike lays-off hardware staff in move that casts doubt on future of FuelBand
Greenpeace says save the bees or humans will die
What brands need to know about changes to VAT and online downloads in 2015
Jimmy Savile victims urged to claim compensation in new ad campaign
UKIP launches biggest  ad campaign and stirs up 'racist' accusations
Apple boss Tim Cook provides voiceover on ad touting firm's renewed green commitments
John Lewis walks consumers through its history to celebrate 150 years of business
Waitrose boosts content strategy with 'Weekend Kitchen with Waitrose' C4 tie-up
Hottest virals: Cute puppies star in Pedigree ad, plus Idris Elba and Fruyo
Amnesty International burns candles to illuminate new hope
Tom of Finland's 'homoerotic' drawings made into stamps
Toyota achieves the impossible by calming angry Roman drivers
YouTube reveals user habits to appeal to 'older' marketers