UK: Asda claws market-share gains

By Katy Askew | 15 November 2012

  •  Asda sales "ahead of the market"
  •  Revenue up 0.3%
  •  Price, multi-channel development to drive growth
Asda bullish on relevance of price-message

Asda bullish on relevance of price-message

Asda emphasised today (15 November) that it has been able to win over market share as it reported slightly higher third-quarter sales.

The UK arm of Wal-Mart said that sales in the three months to 29 September edged up 0.3%. However, the company stressed, the group "out-performed" the market and Asda grew its share of total sales by 10 bps year-on-year to 17.5%.

"These are solid results in a tough market," CEO Andy Clarke emphasised. "We continue to strike the right balance in terms of delivering low prices, great quality and unbeatable service. That focus on real value is what our customers want."

Clarke said that UK consumer spending power is being increasingly squeezed. According to Clarke, this makes Asda's continued price investment "more important than ever".

In a separate announcement today, Asda parent Wal-Mart also emphasised the ongoing importance of its price-focus. This, Wal-Mart said, will become even more relevant as it moves into the key Christmas trading period

Asda added that it is hoping to drive long-term sales gains by further developing its multi-channel strategy, including the roll out of more click and collect locations.  

Show the press release


Asda continues to grow ahead of the market, with Q3 like for like sales of 0.3 per cent
Like for like sales up 0.3 per cent for Q3 (13 weeks to 29th September)
Asda continues to grow ahead of the market increasing its market share to 17.5 per cent (an increase of ten basis points year on year)
President and CEO Andy Clarke says it's a 'solid performance in tough economy and challenging market'
Asda today (Thursday 15th November 2012) announced it had grown its like for like sales (excluding fuel and VAT) by 0.3 per cent in Q3.
Asda out-performed the market during the quarter, growing its market share to 17.5 per cent, an increase of ten basis points year on year.
At a briefing in London today Asda CEO and President Andy Clarke said he was pleased with the retailer's performance and outlined the company's commitment to offering everyday low prices to its customers in a tough economy.
"These are solid results in a tough market. I'm pleased we continue to strike the right balance in terms of delivering low prices, great quality and unbeatable service. That focus on real value is what our customers want.
He added that money was increasingly tight for customers:
"Our latest income tracker out today shows that after a period of slight improvement disposable income is more or less flat again this month.
"So our continued investment in lowering the prices of the core commodities our customers need week in, week out, is more important than ever and means we can stretch their budgets a little bit further."
"As always our low prices are backed up by the Asda Price Guarantee where we promise to be 10 per cent cheaper than our rivals*. It is an unbeatable guarantee and is being used by a million shoppers a week in the run up to Christmas."
Commenting on Asda's performance, President and CEO of Walmart International Doug McMillon said:
"The U.K. had a solid third quarter in a very challenging market. As others have reported, U.K. consumers remain hard-pressed economically. Petrol prices remain a factor, with average fuel prices in the U.K. at £1.38 per litre.
"During the quarter, Asda maintained its commitment to EDLP, investing in price reductions of key food commodities to provide our customers with much-needed relief from inflationary pressures. At the same time, Asda has continued to drive strong multi-channel growth with a focus on improving the online shopping experience."
Since July Asda has held down the price of key commodities such as bread, milk and eggs to £1, shaving millions off the weekly grocery bill. In recent weeks it has also led the way in cutting fuel prices by up to 6ppl.
Andy Clarke has also joined calls for a freeze in fuel duty, saying a 3ppl tax in January would come at the 'worst possible time for families' who will already be feeling the cost of Christmas and energy price rises.
At the same briefing today, Asda Chief Operating Officer Judith McKenna outlined the significant investment Asda is making in developing its multichannel business which has doubled in size in the past two years and is set for continued rapid growth.

Original source: Asda

Sectors: Financials, Multichannel, Retail

Companies: Asda

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