...In the year ahead, we will further improve our customer offer through lowering prices, providing better service and great new products.
We will be Morrisons. Making great quality fresh food in our factories and shops. Selling at low prices. Market Street is Morrisons. Our unique craftspeople butchers, bakers, fishmongers, greengrocers are Morrisons.
If we get all the everyday small details right, more customers will shop with us more often.
And more customers mean more sales, which will ultimately mean more profit to invest back into improving our customer offer even further...
We are a value-led grocer, British born and bred, focused on fresh food. High quality, fresh products are at the heart of everything we do. We have our own manufacturing production facilities that supply our stores to ensure that we sell only the best products. Our vertical integration gives us both control over the provenance of our supply chain and the flexibility to meet the demands of customers. We have adapted to the changing demands of our customers by launching a multi-channel offer that gives the same great supermarket experience to customers in our convenience stores and online business.
This data is based on internal reporting regions and excludes our store in Gibraltar.
Consumer confidence has started to recover in recent months, however, savvy shopping continues, with customers expecting, and seeking out, great value for money by shopping around. The reductions in oil prices and low interest rates are likely to sustain this growth in confidence. However, real disposable income has a way to go to regain pre-2008 levels, and customers tell us that they are unlikely to return to old shopping patterns in the near term. Shopping around for the best value will continue. We saw a notable drop in food inflation through the year, and we expect downward pressure on prices to be a feature for some time.
This shift in shopping behaviour, alongside societal trends such as an ageing population and more single person households, continues to result in customers making more frequent grocery shopping trips. Kantar Worldpanel has the average UK household making 4.9 grocery shops each week across all channels and formats. The days of a once a week big shop are over, replaced with several trips and possibly one larger trip for the weekend. Consequently, the importance of fresh food continues to grow for customers.
The 2008 recession enabled rapid growth of the 'Discount Sector' causing a structural shift in consumer behaviour as they searched for best value from multiple retailers. We have reacted to this shift by investing heavily in price during the year, starting with the 'I'm Cheaper' campaign. During October we launched Match & More, our new price match and points card.
Unsurprisingly, customers continue to tell us that price remains the biggest driver of store choice. Importantly, they want more trust as too many retailers are putting prices up at the same time as shouting about prices they've put down.
Research also shows that customers want more than just cheap prices. Other factors such as range, quality, ease of shop and service all play a part in a customer's decision making process when choosing where to shop.
Our strategy, set out on the following pages, addresses these trends. Alongside our price investment activity, we launched Match & More during the year, price matching Tesco, Sainsburys, Asda, Aldi and Lidl ensuring that price is never a reason for customers to shop elsewhere and gives them the trust they demand, which has been very well received. We have seen an improvement in volume per basket with Match & More playing a part in this.
Controlling food provenance, safety and quality. Getting food onto our shelves fresher and faster.
Making more fresh food than any other supermarket.
Delivering our fresh-focused customer experience in stores and online.
Through our Ethical Trading Code and Manufacturing Standard.
Our vertical integration model allows us to take cost out of the supply chain to pass on to customers.
Transparent promotions and clear shelf edge pricing are complemented by our Match & More guarantee.
If a customer is not 100% satisfied, neither are we. We offer refunds and replacements on products prepared by us.
Buying whole animals and crops direct from farmers and processing through our own operations eliminates needless waste.
Our warm customer service provides enhanced perception, engagement and loyalty.
Our in-store skilled colleagues tailor portion sizes to suit customers personal preferences.
In store, our operation allows us to react quickly and efficiently to customer needs, catering for local demand.
1 The three year period comprises 2014/15, 2015/16 and 2016/17.