n around tumbling profits, UK high street bakery chain Greggs is to introduce a more customer-focused marketing strategy and switch its focus from its bakery business towards the food-to-go category.Greggs plans to expand its pizza, sandwich and breakfast ranges in a bid to compete directly with popular on-the-go option Pret-a-Manger.
In terms of customer engagement, the company also plans to launch its first digital customer loyalty scheme, building on the company's existing loyalty scheme.
The chain plans to merge its two separate high street formats, which include a 'food-on-the-go' format and a 'local bakery' format.
The chain also plans to scale back its international expansion plans to concentrate on its home market and will reduce activity on its 'bake at home' collaboration with frozen foods retailer Iceland, while the Greggs Moment coffee shop venture is to be halted.
Greggs will also not go ahead with plans to build a second frozen savory plant in the East Midlands, having already spent £500,000 on the project.
The chain, which has a portfolio of close to 1700 stores in the UK, recorded a 29% year-on-year drop in profit to £11.4 million for the first half of 2013. Like-for-like first-half sales fell by 2.9% to £361.7 million.
Management blamed the hot weather for stunting sales of savoury bakery goods but admitted that Greggs had 'underperformed' in the food to go category, as new entrants and existing players expanded their offering.
Chief executive at Greggs, Roger Whiteside, said, "Whilst over many years Greggs has developed a leading position in the bakery market, customer preferences are shifting towards ‘food on the go’. Greggs is a much-loved and trusted brand and we can leverage our heritage in fresh bakery to compete successfully in the food on the go market."
He added, “As a consequence we will spend the next two to three years reshaping the business as we build the platform for the long-term sustainable profit growth for the benefit of shareholders, employees and the wider community.”
