Woolworths has announced that it will focus more on delivering every day low prices on products and cut back on weekly promotions.

Price is a key metric of store choice

Speaking last week, Director of Buying at Woolworths, Peter McNamara, explained that shoppers have been telling the retailer that although getting a "good deal" remains important, having prices that are trustworthy is "one of the key metrics of store choice". Weekly promotional offers have been "eroding" trust and only provide short term value. Over the past two years Woolworths had reduced promotional intensity by 17% and will continue on this journey, although no target has been set.

Global shift from promotions to price

Globally over the past few years, many retailers have been trying to shift the focus away from short term promotions to offering better every day value. In Australia, Coles has been on this journey for some time with its Down Down and Every Day campaigns resonating with customers.  McNamara said that Woolworths will continue to ramp up efforts in this area, however added that the retailer would need to educate shoppers of the shift away from promotions to fairer, more consistent prices.

Kaufland entry could lead to more focus on price 

The changing balance between promotions and price in many countries has been driven by soft economic growth. However, the growth of discounters has also led to retailers reassessing their strategies. With Aldi already having a strong presence in Australia and Kaufland, another value-orientated retailer due to open its first stores in 2020, Woolworth, as well as other retailers in Australia will want to ensure that its pricing strategies are robust and understood by customers.

Woolworths in Australia has announced a restructure of its in-store fresh food teams.

Two in-store teams to oversea fresh food

The new structure will see the creation of two teams in each supermarket; the 'fresh service' team that will run the butchers, seafood and deli counters and the 'fresh convenience' team that will operate shelf-orientated fresh food such as dairy, packaged meat, eggs, bread and food-for-later meal solutions. The changes have been tested in-store in New South Wales and having proven successful, willl be gradually rolled out nationally in the coming months.

New training and staff numbers to remain unchanged

As part of the change Woolworths will invest AU$10m on training staff and developing new skills. This is the first major resturcture that the retailer has implemented in-store since 2011, with some roles set to become redundant and others created, meaning that staffing levels will remain consistent. The changes are set to help Woolworths better service the growing demand from shoppers for high quality fresh food throughout the day.

As shoppers change, in-store operations need to change...

Claire Peters, MD of supermarkets for Woolworths, commented, “Over the last few years our customers’ needs have changed, but the way we have been operating our stores has stayed the same. With customers’ ongoing expectations in fresh, and more shoppers looking for increased convenience, our stores need to deliver the best possible customer experience, every time.”

Woolworths' flagship liquor banner has poached Alex Fruedman from Coles to head up its operations. 

20 years of experience in Australian and UK retail

Alex Freudmann will take over as Dan Murphy's managing director from Faye llhan who has been overseeing the business in an interim role. Freudmann will bring over 20 years of retail experience to the role having worked in the industry both in Australia and the UK for Tesco. Although his start date is to be confirmed, he will move from his current role as director of fresh food at Coles, which he started in March 2018.

Changes ahead for Dan Murphy's...

The new managing director will report to Steve Donohue, managing director of Woolworths-owned Endeavour Drinks Group. Donohue, commented, “The team at Dan Murphy’s has been working hard at re-establishing sales momentum while also strengthening key foundational areas to better serve changing customer needs. The business has a long history of success with strong customer loyalty, however rapid market changes require us to transform Dan Murphy’s for sustainable long-term growth.”