Digital drives Q4, full year at Albertsons

The retailer saw digital sales grow by 282% in the quarter and 258% for fiscal 2020, while it also expects own brands to continue to grow its market penetration.
Dan Ochwat
Executive Editor
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Albertsons is on pace to reach its goal of own brand market share penetration of 30% in the next few years as supply chain disruption from the pandemic has gone away and market penetration surpassed 25% in the fourth quarter, according to Vivek Sankaran, president and CEO of Albertsons.

Sankaran spoke during the Boise, Idaho-based retailer’s fourth quarter and full year report and said that its store brand portfolio continued to gain traction during the quarter ended Feb. 27, particularly in the fresh department like seafood, meat and floral, far outpacing sales growth in the center store.

Albertsons launched 1,200 new own brand products in 2020, well above its stated goal of 800. Sankaran said own brands are driving its “in-store excellence” pillar and the company will be focusing more on ready-to-heat meals going forward.

For the quarter and fiscal 2020, Albertsons saw tremendous growth.  For the quarter, identical sales growth was up 11.8% and increased just shy of 17% for the year. Adjusted net income reached $1.9 billion for the year and adjusted EBITDA of $4.5 billion for the year.

Drive-up-and-go sales were up more than 1,000% in 2020 vs. 2019.

“Digital was a key catalyst for growth,” Sankaran said during the report, noting digital sales growth leaped 282% for the quarter and up 258% for the year. He said drive up and go was up more than 1,000% year over year and Albertsons expects to reach 98% coverage, more than 2,000 stores, in 2021.

Sankaran also said the retailer’s loyalty program continues to grow, gaining 11 million more households in 2020 compared with 2019, reaching 25.4 million total members. He said loyalty members spend 2.6 times more than non-rewards shoppers and those considered to be omnichannel shoppers, both buying digitally and in-store, spend 20% more in-store than non-omnichannel shoppers.

"We are very proud of what our team accomplished in fiscal 2020, serving our customers and communities throughout the COVID-19 pandemic. As a result of our strong execution, we delivered record full-year results, drove meaningful market share gains and are well positioned for continued success and strong performance in fiscal 2021,” said Sankaran. 

"We have made substantial progress against our strategic priorities, and are still in the early innings of our transformation journey. Looking ahead, we remain committed to further strengthening our relationships with our customers, offering a superior shopping experience and generating value for all stakeholders,” he added.