Sainsbury’s premium Taste the Difference own label range outperformed rivals to help the supermarket to a record Christmas, despite ongoing weakness at Argos.
CEO Simon Roberts said the group won grocery market share for the fifth consecutive Christmas, with more customers choosing Sainsbury’s for their big shop.
Sales over the crucial six weeks to 4 January improved 3.8% year on year, with grocery sales up by the same figure and general merchandise and clothing rising 3.4%.
Taste the Difference products featured in more than half of big Christmas baskets, helping the range increase sales 16% year on year. Roberts claimed the range outperformed “all key competitors”.
However, Argos managed like-for-like growth of just 1.1% over an extended eight-week period, which included sales from Black Friday.
Sales declined by 1.4% at Argos over the 16 weeks of the group’s third quarter to 4 January as the retailer struggled to attract customers outside the key Christmas and Black Friday trading windows.
It dragged down Sainsbury’s total retail sales growth in the third quarter to 2.7%, compared with 4.1% in Q2.
Sainsbury’s ‘highest ever’ sales
Roberts added Sainsbury’s had now achieved seven consecutive quarters of volume performance ahead of the market and further accelerated two-year volume growth.
“The strength of our customer service and operational performance stood us apart in delivering our biggest ever Christmas,” he said. “Customers shopped later than ever and we achieved our highest ever sales in the final days before Christmas.
“Customers chose Sainsbury’s for their big festive celebrations, with party food sales up nearly 40% and more than 200 bottles of fizz sold every minute in the key days ahead of Christmas, over one third of which were Taste the Difference.
“Customers are also recognising our consistently strong value more and more, helped by record numbers of customers shopping Nectar prices, driving gains from competitors as we attract new big basket customers to Sainsbury’s.”
Read more: M&S ‘the top performing store-based grocery retailer’ in Christmas ‘golden quarter’
Sainsbury’s also announced an inflation-busting pay rise for 118,000 hourly-paid staff of 5% for the year ahead, split into two separate increases to help manage “a particularly tough cost Inflation environment”.
“We believe in rewarding our colleagues well for delivering leading service and productivity and we will be the best-paying UK grocer from March,” Roberts said.
Staff across Sainsbury’s and Argos will move from £12 to £12.45 per hour in March, and £13.15 to £13.70 for those based in London, with a further increase to £12.60 per hour in August and £13.85 for those based in London. Sainsbury’s said that, by August, pay for hourly-paid colleagues would have increased by 58% since 2018.
The move will take the total salary for a full-time member of staff outside London from £22,882 to £24,026 by August 2025.
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