Grocer Gold Awards 2024: Sainsbury’s becomes Grocer of the Year

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Grocer OTY

Sainsbury’s CEO Simon Roberts, and chief food commercial officer Rhian Bartlett

Winner: Sainsbury’s

Winning this award for the first time since 2007, Sainsbury’s has restored growth while increasing profits. Not an easy thing to do at the best of times, but especially with the highest inflation in decades, and the discounters – and other rivals – also opening a significant number of new stores.

The catalyst: it’s difficult to look beyond the launch of Nectar Prices last April, and its impressively rapid rollout.

The loyalty pricing move marked a further step-up in Sainsbury’s 2020 Food First strategy. A £780m investment in prices over the past three years – supported by simplified own-label ranging and its Aldi Price Match – has narrowed the gap by 16% against the discounters and improved value perception among shoppers. But Nectar pricing took value perception to a new level, and participation has quickly reached over 90%.

As a result, Sainsbury’s has increased share and shopper penetration, has been ahead of the market in both value and volume growth, and was the only big four supermarket in the past year to gain shopper spend from both Aldi and Lidl.

What’s even more impressive is that it did so while increasing gross margins and improving cashflow, the result of a three-year £1.3bn cost cutting programme and productivity drive, supported by savvy investment in in-store, retail media and demand forecasting technology.

Sainsbury’s has also led the market on pay. Since 2020, it’s increased pay for its 150,000 staff by a third, a £500m investment – and improved colleague engagement at the same time. And in March it became the first major supermarket to commit to the new real Living Wage, through a further £200m investment.

Another key area of progress has been on the sustainability side. Eye-catching innovations have involved reducing packaging in areas like mince and switching from plastic to paper for own-label mushrooms.

But behind the scenes Sainsbury’s has reduced carbon emissions by switching to renewable energy across its store estate. It also received an A-rating for climate change disclosures (the only UK retailer to do so) and supplier engagement from environmental impact not-for-profit CDP.

Of course, none of this success would have been possible without great food. Sainsbury’s Food First strategy was predicated on pushing innovation and bringing “joy” back to shoppers’s lives. And, as well as supporting future brands, in the past year it has more than doubled new product development, with a particular focus on events, including 170-plus Taste the Difference new products last Christmas, boosting premium share growth.

But it’s Nectar Prices – and a more competitive pricing proposition in general – that has given shoppers permission to return to Sainsbury’s, where they can indulge in their love of food without guilt.

And Sainsbury’s Next Level Strategy, announced in February, promises to evolve the successful Food First strategy still further.