mike coupe sainsbury's

There was a certain weariness to Sainsbury’s CEO Mike Coupe’s voice today as he talked, yet again, about the impact of food price deflation. The downward pressure had continued to affect sales figures, he said, as journalists quizzed him on the 1.1% fall in like-for-likes in the latest quarter. But the chief executive took on a more positive tone as he talked about the strategy of the business – particularly online – which he said was “making good progress”. Here are the six key messages from Coupe today:

1. Same-day delivery isn’t a fad: The supermarket has expanded the number of stores offering same-day delivery on groceries from three to eight over the past two months, Coupe revealed. It’s undeniably fast progress and an indicator of just how committed Sainsbury’s is to the service. For Coupe, it is all part of the Sainsbury’s oft-cited strategy to serve customers “wherever and whenever they want”. The tagline may make a glib appearance in every Sainsbury’s interview, but Coupe appears to be genuinely passionate about it. “Same-day will become the currency of the market,” he argued. The supermarket is due to offer same-day delivery in 30 stores by the end of the year and, if Coupe’s enthusiasm is anything to go by, next year may herald the start of a much wider rollout.

2. People will pay for convenience: Pressing ahead with same-day delivery – which carries a charge of between £5 and £7 – shows Sainsbury’s believes customers are willing to pay a premium for an express service. The same goes for its Chop Chop one-hour delivery app, which carries a £4.99 delivery charge and was expanded across London this week. Coupe said he was “pleasantly surprised” by the level of demand seen in the three-month trial in Wandsworth, and the wider rollout would determine whether this price point resonated with customers. “Clearly there’s a premium attached to time and, for some, the speed is worth paying that £4.99,” he said.

3. Food-to-go remains a growth area: When pressed on which areas of food had done particularly well, Coupe named food-to-go as an example. “The On the Go range looks particularly good for us,” he said, which he tied into the growing consumer demand for convenience. But it remains to be seen whether Sainsbury’s will perform so strongly in this category after revamping its range and removing Taste the Difference sandwiches from its meal deal, which resulted in this month’s borderline hysterical social media backlash #sandwichgate. Watch this space.

4. It’s sharper than ever on price: Following Aldi’s 11.8% sales growth, it was inevitable Coupe would face questions over the power of the discounters. And he came well prepared. “Our price position relative to discounters has never been sharper,” he fired back. Plus, Coupe maintained that Sainsbury’s beat Aldi and Lidl hands-down on service – citing its four-year reign of success in the Grocer 33 as evidence.

5. Management is not distracted: Sainsbury’s undeniably has a lot on its plate at the moment, with the acquisition of Home Retail Group, the construction of a new fulfilment centre in Bromley-by-Bow and the launch of a new express delivery service. But Coupe firmly rejected suggestions these developments could distract management from the core business. “They’re not distractions, they’re very much part of our business,” he said. And he reeled off a long list of improvements to its basic grocery offering as evidence this wasn’t being neglected. “We’re improving quality of products we sell, investing in core pricing of the products we sell, improving our convenience business and growing through more store development,” he said.

6. There were never any doubts about Argos: The 2.3% growth in like-for-like sales at Argos could be taken as vindication of Sainsbury’s takeover bid. But Coupe needed no such thing. “I’ve never been not confident about the deal even if I’ve been pressed a million times about it,” he said. Coupe repeatedly came back to Argos’ capacity to deliver in a space of four hours as proof it would be a valuable acquisition in today’s environment. “Shopping habits are changing. Customers demand more and more speed and we have to be there for them” – you guessed it – “whenever and wherever they want”.

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