According to new research, the Checkers Sixty60 grocery delivery app is eating into Woolworths Food sales due to the efficiency of the service. This is the outcome of work done by FNB Wealth and Investments, led by Chantal Marx, head of investment research and content. According to Marx, Checkers has repositioned its brand as a more premium option than its Shoprite brand and have started munching on Woolworths’ share of wallet in its target audience.
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While Checkers has effectively pivoted its brand, the Sixty60 app is the biggest reason why the Shoprite Group has eaten into the Woolworths market share. In its latest annual financial results, Shoprite said Checkers Sixty60 maintained its growth trajectory, reporting another 150 percent increase in annual sales. It is also expanding the store base from which it services Checkers customers to 300 stores.
Sixty60 now has more than 2.4 million downloads in South Africa, by far the biggest in the country. Marx notes that a significant portion of its 150 percent annual growth came at the expense of Woolworths, as its convenience is bringing in a slew of new customers that would traditionally spend at Woolies.
“You only have to look at how Woolworths Food has performed over the last year or two to see what the Sixty60 convenience offering has done,” Marx said.
“The Checkers brand’s value positioning and store upgrade strategy continued to deliver superior growth relative to peers,” Shoprite said. “It is supported by the sustained and growing contribution from our world-class, on-demand, one-hour grocery delivery app, Checkers Sixty60.”
Shoprite has been performing well and is a very robust business in South Africa. “Shoprite has invested heavily in its distribution and store footprint. It is a strong business which is growing nicely and generating cashflows,” Marx said.