Comment: Morrisons is playing catch up with its rivals

Morrisons has been playing catch up again this week, both with opening hours and marketing.

The Bradford-based grocer is aiming to be more convenient for its customers by extending its opening hours both in the morning and evening. It is, says Morrisons boss Dalton Philips, changing to meet the demands of “modern family life, flexible working hours and busy schedules”.

The move is probably necessary but it is something which its rivals have done for years. Both Asda and Tesco have many stores open for 24 hours and the latter dominates the landscape in terms of convenience stores.

Shore Capital’s Clive Black points out that longer opening hours are “likely to be included in the group’s measure of Q3 like-for-like sales” but adds it also means “higher operating costs, as staff need to be deployed beyond basic care and maintenance cover in order to serve customers”.

Morrisons has also switched its marketing slogan just four months after it launched to much fanfare. The ‘I’m Cheaper’ campaign was a key part in Philips’ fightback which saw over a thousand products slashed in price, the average being cheaper by 17%.

‘I’m Cheaper’ has now been sidelined for ‘Everyday low price’. Morrisons says the initial campaign communicated price cuts, and now it wants to reassure customers that the price cuts are permanent.

It’s difficult to say yet whether ‘I’m Cheaper’ worked for the grocer. Some commentators thought the word ‘cheaper’ had negative connotations, and it did seem a little confused – many wondered whether it was meant to be cheaper than rivals, or cheaper than it was the previous week.

The launch of ‘Everyday low price’ shows Morrisons again catching up with rivals. It’s an industry wide term but one that is most commonly associated with Asda. Tesco though also has its own version, ‘prices down, staying down’.

Price cuts take a long time to take hold. Black points out that Asda started a pricing programme in 2013 and it was between six and 12 months later that a demonstrably better relative performance came through – seen by Asda’s recent outperformance versus the other big four players.

It would help Morrisons though if it’s messaging was consistent. Switching a strapline after just a couple of months could confuse customers, but if the new message is here to stay then it may eventually take hold.

Morrisons is not out of the woods yet, but rightly so, it is desperately trying to meet the needs of its customers.