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Morrisons ‘Price Crunch’ – Which categories have been most affected?

price-crunch

Last month Morrisons announced that its like-for-like sales grew 0.2 percent over the Christmas 2015 period. The news came as a surprise to some analysts who had previously forecast that like-for-like sales would fall by around two percent in the nine weeks to 2 January.

In its trading statement, Morrisons stated that over the Christmas period it had a ‘greater focus on everyday value, running less multi-save promotions and providing bigger packs with better value’.

In an continued effort to attract shoppers, Morrisons announced on 1 February that it would ‘cut the price of 1,072 items with many of the reductions on fresh food, such as fruit and veg.’

The retailer detailed that the price cuts would be communicated through a ‘Price Crunch’ campaign which ‘will be a rolling programme of lower prices, typically lasting a minimum of three months.’

Morrisons ‘Price Crunch’ analysis

Brand View has analysed the 949 products which were available on the ‘Price Crunch’ page of the Morrisons website on 3 February 2016.

Some 69.4 percent of the products in the ‘Price Crunch’ selection were in the Grocery category – 57.7 percent of these were Ambient products.

In total, 31.1 percent of the ‘Price Crunch’ selection in the Grocery category were Chilled products, which includes fresh fish, fruit, meat and vegetables.

Morrisions-Pie-Chart price crunch analysis

 

Of the ‘Price Crunch’ cuts 12.5 percent were in the Health & Beauty category, of which 59.7 percent were Hair Care products. The remaining 18.1 percent of ‘Price Crunch’ products were in the Home Care, Beers, Wines & Spirits and General Merchandise categories.

Own Label products made up 41.8 percent of the ‘Price Crunch’ selection.

Most heavily promoted categories

The Brand View category, Cakes and Cookies, had the greatest number of products (48) on the ‘Price Crunch’ page – 36 of these were Own Label products with the remaining 12 from Dr. Oetker, Thorntons and Weight Watchers.

The Hair Colourants category was the second most promoted, with 38 products, ahead of the Baking category with 36.

In the Hair Colourants category 23 of the 38 were Vidal Sassoon products and the remaining 15 were from the Schwarzkopf Live Color XXL range.

most heavily promoted categories morrisons price crunch

 

Morrisons ‘Price Crunch’ average shelf price reduction

Brand View has reviewed the average shelf price reduction of the ‘Price Crunch’ cuts in categories with ten or more reductions.

Three of the top ten categories with the greatest reduction were in the Hair Care category – Hair Wash & Care, Hair Colourants and Hair Styling.

The Hair Wash & Care category had the greatest average price reduction of 36.8 percent –  8.1 percent ahead of Hair Colourants.

morrisons price crunch

 

In its statement, Morrisons highlighted its reductions of vegetables and fresh fruit, although these categories only had the the fifth and ninth greatest percentage discount.

Fresh Fruit and Vegetable ‘Price Crunch’

Looking at a sample of fresh fruit and vegetable products we can see that since the ‘Price Crunch’ campaign began Morrisons was the cheapest retailer on eight of the ten sample products.

One of the greatest price differences was for Own Label Pre Packed Onions 1000g. Morrisons was 20 percent cheaper than the next cheapest retailers.

daily prices and promotions morrisons price crunch
Brand View Daily Price and Promotions 11 February 2016

 

Since announcing the ‘Price Crunch’ campaign Morrisons has seen a strong response from its competitors – namely Aldi. On 12 February, Aldi announced a new range of price cuts across its range, including fresh fruit and vegetables and parodied Morrisons’ new ‘Is a price crunch amazing?’ ad with it’s own ‘No, this is amazing’ ad campaign.

The ongoing CMA investigation into misleading pricing in the Grocery sector has contributed to the supermarkets phasing out complicated promotions and instead favouring simpler, lower pricing.

Sainsbury’s announced in February that will phase out the vast majority of its multi-buy promotions across its grocery business by August 2016. It will instead invest in ‘lower regular prices’ – rival supermarkets are expected to make similar promises.

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