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Asda sees online grocery demand dip as shoppers return in-store

Asda promises its shoppers better value and convenience. Image courtesy of Asda

Asda says online grocery demand has dipped as more shoppers have returned to buy in-store. 

The supermarket, ranked Elite in RXUK Top500 research, says online sales were 2.7% down in the third quarter of its financial year, compared to the same time last year. However, ecommerce is still 80% higher than it was in pre-pandemic 2019. 

During the quarter, the retailer launched a one-hour Express Delivery service and says that’s proved so popular that it has rolled it out to 146 shops. At the same time, it has expanded fast online deliveries via Uber Eats to more than 300 stores. 

The update came as Asda this week reported £4.9bn in revenue in the third quarter of its year, to September 30. Like-for-like sale, excluding fuel, fell by 0.7% on the same time last year, but rose by 2% compared to the same period in 2019. Clothing sales rose (+1.2%) during the period on a like-for-like basis that strips out the effect of store – and business – openings and closures, but general merchandise sales fell (-3.1%). Since the comparison period – a year earlier – social distancing regulations had been lifted and most shoppers have been vaccinated, encouraging them to return in-store to buy. 

Christmas stock-up

Asda is increasing its grocery home delivery slots to 1m in the last week before Christmas, staffed by some of the 15,000 temporary staff that it has recruited to cover the peak trading season. That’s up from 765,000 slots at the same time last year. It has also chartered its own cargo ship for the first time to stock up with toys, clothes, gifts and decorations ahead of Christmas, and has built up stocks of festive products from mince pies to Christmas cakes and puddings in the light of widespread supply chain issues. 

Mohsin and Zuber Issa, who co-own Asda with TDR Capital, say: “We know how much Christmas means to our customers, especially after some missed out on celebrations with friends and family last year. Our colleagues have pulled out all the stops during the last few months to make sure customers can get their favourite festive products at Asda and enjoy the Christmas they deserve – and we’d like to thank them for their continued effort and commitment to serving our customers.”

Asda on the Move

Asda has so far opened 30 Asda on the Move convenience stores on EG Group forecourts.

“Looking ahead, our plans to rollout Asda on The Move remain firmly on track and will open up significant growth opportunities in the convenience channel. We are also highly encouraged by the early uptake of our Asda Rewards loyalty programme and look forward to bringing this trial to customers in more stores next year.”

Asda recently appointed Lord Stuart Rose, previously of M&S, as chairman, while other key hires include Meg Farren, previously of KFC, as Asda chief customer officer and Liz Evans, previously chief executive of Fat Face, as managing director of its George clothing business.

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