A great story is told about when Justin King joined Sainsbury’s as chief executive.
JS was sorely in need of some TLC at the time and everybody at head office was excited about King’s arrival.
On his first day in the role, diaries had been cleared and managers lined up at Sainsbury’s gleaming HQ to greet him. But of King there was no sign.
After a while, someone decided to call his mobile. They quickly got through. “Where are you?” King was asked. “Everybody’s expecting you at work.”
“I am at work,” King shot back. “I’m visiting stores.”
It was a powerful statement of his priorities and intent.
King, of course, is an Asda alumnus. And Sean Clarke, the Asda chief executive who next January will hand over the reins to Roger Burnley, seems to be cut from the same cloth as King.
Clarke will hand over to Burnley a business that is making solid progress in restoring its fortunes. The latest Kantar numbers, for instance, showed Asda notched up sales growth of 1.8%.
A salient point is that growth was propelled by own-label. At opposite ends of the spectrum, the value Farm Stores offer and premium Extra Special lines helped own-brand to account for 45% of sales.
Key to Asda’s improved performance, evident in the growing appeal of own-label, has been a renewed focus on customers.
And that has been enabled by listening to voices from the shopfloor, where customers are served day in, day out.
Clarke, says one Asda insider, has huge trust in store staff.
“It was pretty much what you’d expect from Asda. That’s praise, not criticism – not being pretty much what was expected, as Aldi and Lidl filled the gap, was one of the Walmart-owned grocer’s problems”
Since joining little more than a year ago he has prioritised listening to them and empowered them to speak on behalf of the customer. “If he’s got a Fitbit, he’s certainly been getting his steps in,” says one source.
After the handover at Asda was announced – Burnley will succeed Clarke on January 1 next year – I took a look around one of the grocer’s London superstores.
Signs screaming value abounded, price rollbacks were heavily promoted. There were prominent deals on Christmas treats, such as low-price Prosecco and panettone.
It was pretty much what you’d expect from Asda. That’s praise, not criticism – not being ‘pretty much what was expected’, as Aldi and Lidl filled the gap, was one of the Walmart-owned grocer’s problems.
Work to do
It was not perfect by any means. There were some big availability gaps in some parts of the shop and some aisle-end deals seemed a bit tricksy.
For instance, prices ‘starting from’ were trumpeted. While such items were there, the most prominent were more highly priced. Perhaps there’s still a balance to be struck between canny retailing and what a customer might expect from the signage.
Asda staffers would be among the first to admit that the turnaround is by no means complete. However, Clarke’s imminent departure shows that much of the heavy lifting has been done, and there is confidence in the incoming chief executive.
“While shopping habits change and ecommerce continues to stake up traditional retail, Asda’s improved prospects show how important stores remain”
Burnley was always seen as Asda’s chief executive in waiting since he rejoined from Sainsbury’s. And it was always acknowledged that Clarke would move on once he had set renewed direction and there was evidence of sustainable success.
But there would be no question of a handover were Clarke and Walmart’s top brass not happy that Burnley was the right person to take up the baton.
While shopping habits change and ecommerce continues to shake up traditional retail, Asda’s improved prospects show how important stores remain.
And how important it is, as King, Clarke and no doubt Burnley know, to listen to the people who know the customer intimately – the staff on the shopfloor.