It was interesting to hear Dixons’ chief executive Seb James say today that successful multichannel electrical retailing is like playing a three-card-trick.

It was interesting to hear Dixons’ chief executive Seb James say today that successful multichannel electrical retailing is like playing a three-card-trick.

But, in the light of today’s interim results, is Morrison’s playing the right cards to win in the equally competitive world of food retailing?

With like-for-likes under pressure and profits only about flat, even on an “underlying” basis, Morrison’s doesn’t look in great shape relative to its much-vaunted strategy of being “different and better than ever”.

Management protest that everything is bang on track and that the new-format stores are getting the right returns, but it is all rather like playing a game of pontoon and getting dealt only 14 when you really expected to get 21.

Should Morrison’s stick or should twist? Just carry on with the long-term strategy, or gamble and change course?

A recent visit to the revamped Morrisons store at Wincanton in Somerset, a former Safeway next to a new Lidl, rather reinforced the view that there is actually not much wrong with the strategy, despite Sir Ken’s strictures that “posh food is not the way”.

Morrisons aspires to offer “great fresh food at unrivalled value for money in an engaging shopping environment” and, by and large, that is what it now does in Wincanton, to the extent that even the most loyal Waitrose shopper (or Lidl shopper) would not walk out empty-handed.

Perhaps it is the tactics, together with the pace of execution and the communication, that are the problem and not the strategy. The food retail world is not standing still and Morrisons should have known, for example, that Asda’s Netto conversions would have impacted on 100 of its heartland stores while it was chasing growth south of St Albans. What it needs to do now is press on and pick up the pace of the so-called Fresh format store revamps and tweak customer perceptions.

It is always dangerous to neglect core shops while trying to perfect a new store concept and to allow customers to think that the new approach is drifting upmarket, so it is good to see that Morrisons has had the courage to be more forceful with in-store POS about the value message in revamped stores. And with 55 more store revamps in the second half, Morrisons will have 100 such stores by next spring, accounting for about 30% of total sales.

What total sales will be in the second half, with food price inflation on the rise, is another matter. It is embarrassing for Morrisons to be bottom of the pack among the big four, in terms of like-for-likes, but the Asda Netto hit is now passing and management has much faith that the new punchy, if slightly confusing, Fuel Saver promotion with high street retailers gift cards will pull in new business. And Chris Tarrant has disappeared from the recently rather lame Morrison’s radio ads, so we must live in hope.

And thanks to marketing firm Catalina, Morrisons is now close to being able to imitate Sainsbury and others with customer-specific coupons at till, which should help to get it back in the game.

Without an online food or convenience store presence to speak of, Morrisons is playing with one arm tied behind its back and, without the customer data knowledge of Tesco and Sainsbury’s, is also playing with one card short.

But it would be wrong to write off Morrisons’ ability to get the top-line moving again, just as it would be wrong to underestimate its ability to underpin the bottom-line with operational cost savings and the benefits of its vertical integration in manufacturing.