What the Sainsbury's and Asda merger means for customers

30th Apr 2018

As Sainsbury’s and Asda unveil a deal to create the UK’s biggest supermarket chain, Jo Causon, CEO of The Institute of Customer Service, comments: 

“The merger of Sainsbury’s and Asda is an interesting move – currently both supermarkets serve different markets and customer bases. Curious customers will look forward to seeing whether the new offering can serve them both, and what the key differentiator to other brands will be.

“With fierce competition amongst supermarket pricing and promotions, customers have a choice to switch or continue shopping in the same place. This is why service should be any supermarkets’ relentless focus as it can be the difference between loyalty or loss of customers. Our research shows that, on average, organisations who maintain a customer satisfaction score above their sector average achieve 9.1% revenue growth year-on-year, and compound growth of 4.7% across a five to eight-year period. Those with a lower-than-average customer satisfaction score achieve only 0.4% growth year-on-year and just 3.5% in the longer period. If this merger is to change the fortunes and drive a return on their investments for Asda and Sainsbury’s, the brands need to go truly put the customer experience at the heart of their business strategy.

“In the latest UK Customer Satisfaction Index, Sainsbury’s was rated the 39th highest-performing organisation, and Asda didn’t appear in the top 50 at all. With Aldi, Waitrose and M&S Food all ranking within the top 20, there is a clear window for the new merged retailer to shape a strong customer service strategy and earn its place amongst the ever-changing supermarket leaders for satisfying customers. Today’s increasingly-savvy consumers are hyperaware of the value of their custom, pushing retailers, rightly, to invest in customer service standards. This move should be no different. The merge should recognise, and be sensitive to, the needs and preferences of long-standing customers from both supermarkets as well as those interested in making the switch.”

Ends

For further information please contact:
Rebecca Peck, Sophie Lanning, Bethan Davies
E: [email protected]
T: 020 7010 0877 (Rebecca Peck), 020 7010 0826 (Sophie Lanning), 0207 010 851 (Bethan Davies)

About The Institute of Customer Service
The Institute of Customer Service is the professional body for customer service delivering tangible benefit to organisations and individuals so that our customers can improve their customers’ experience and their own business performance. The Institute is a membership body with a community of over 500 organisational members – from the private, public and third sectors – and over 4,000 individual memberships. For more information about the Institute of Customer Service go to www.instituteofcustomerservice.com.

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