Tomorrow will see Morrisons unveil its latest big Christmas TV ad.
This year it will be hoping that the heady mix of everyone’s favourite TV duo Ant and Dec, along with a singing and dancing gingerbread man and some animated versions of Morrisons’ in-house chefs, will get shoppers back into its stores and keep the tills ringing this Christmas.
The ad, for what it’s worth, is a Christmas cracker, and likely to have a better impact than the retailer’s offering last year. Then the tale of a stressed-out mum wrangling with the mountains of work involved in delivering a family Christmas – while quite amusing – lacked the key message that Christmas is actually supposed to be a happy and fun time of the year.
Nor did last year’s ad showcase any of what Morrisons claims sets it apart from its rivals – its Market Street counters with the expertly trained butchers, bakers and fishmongers. The retailer will look to big these up in a series of follow-up ads over the next few weeks.
The irony however is that it is Morrisons’ decidedly lacklustre festive period last year that is now giving it and the City reasons to be cheerful this year.
Today, the retailer revealed a 2.4% fall in third quarter like-for-like sales for the period spanning the 12 weeks to 3 November. Shares initially fell but rallied as management predicted a return to positive like-for-like sales in the final quarter of the year.
What is odd is quite why the City was so cheered – given the very soft comparable Morrisons will be pushing against this Crimbo.
CEO Dalton Philips rightly refused to call the expected return to growth a “turning point”. He said the turning point for him would be when its c-store business starts to reach more of a critical mass – 200 by the end of next year – and when its online offer is fully up and running – also likely to be the end of next year, by which time it will be able to serve around 50% of UK households.
Yes, Morrisons has to tackle what Philips calls the “headwinds” created by its lack of presence in the growing areas of convenience and online. But there are more fundamental issues that still need to be addressed.
Despite criticism that its Fresh Format stores are alienating traditional Morrisons shoppers, the retailer insists that sales uplifts are in line with expectations – which must only mean that the stores yet to be converted are creating an unbearable strain on the business and the store conversion programme has to be speeded up.
However, the process will actually now slow down a little as Morrisons focuses on selling all those crackling turkeys and Panettone over the festive period. The results post-January may well be better – but for Morrisons that’s when the hard work will really need to begin.
No comments yet