Coles is stepping up a fast tracked Christmas advertising push across its stores, website and shopping app to turn festive traffic into extra items in shoppers’ trolleys. It is aiming to lock in sales growth but risks an escalation in its already high stakes rivalry with Woolworths.
Right now, the supermarket sector is heading into what looks like its most critical trading window of the year, with Coles and Woolworths both treating Christmas as a “must win” period after months of scrutiny on prices, margins and customer value. Coles has been outpacing Woolworths on sales growth for more than a year so this holiday season is shaping up as a test of whether that momentum holds or Woolworths can stage a comeback. Investors and analysts will be combing through the February earnings updates to see which supermarket turns festive foot traffic and app usage into higher market share.
Behind the scenes, Coles’ in house media arm is urging food and grocery suppliers to grab last minute advertising placements in premium in store zones, on the retailer’s website and within its app, with some spots discounted by more than 50% to fill the final pre Christmas weeks. Internal figures shared with suppliers show December online activity jumping sharply, with overall site visits up about 20%, in app searches climbing 35% and unique visitors rising 6.5%. The final week before Christmas is expected to bring a further 17% week on week spike on the main digital site. Coles links this engagement closely to spending and notes that close to 8 in 10 customers go on to buy something after using the shopping list function in its smartphone app. This effectively turns the app into a digital storefront that prompts shoppers to add products they had not originally planned to buy.
In the bigger picture, this Christmas campaign looks like more than a simple seasonal promotion. It appears to be a test of how far supermarkets can push app driven nudges and impulse buy tactics without alienating value conscious customers or attracting more regulatory attention. Coles is clearly trying to cement its recent growth lead and position itself as the go to destination for the “big shop” while Woolworths is ramping up its own response with extra delivery and pick up slots and free shipping above certain spend levels. Woolworths is targeting more than 4 million online orders over the season. How shoppers respond to these competing strategies and whether they trade up, stick to budgets or switch loyalties will likely shape the supermarket landscape well into the new year.
