OUR
CUSTOMERS
Ngā Kiritaki

In FY23, our focus remained on enhancing and delivering our five strategic customer experiences aligned with our purpose, vision and values.

1. Helping customers to find what they’re looking for, at prices that are great, every time

Offering a diverse range of products at price points that customers perceive as great value continues to elevate their experience with our brands.

Our approach to range and pricing involves harnessing the power of data alongside the expertise of our experienced team. We curate our ranges and manage our pricing structures using data to pinpoint our optimal range of Stock Keeping Units (SKUs) and affordability. The way our teams work with data enables us to proactively respond to shifting customer preferences through forecasting, price optimisation, and range continuity.

1. Helping customers to find what they’re looking for, at prices that are great, every time

Offering a diverse range of products at price points that customers perceive as great value continues to elevate their experience with our brands.

Our approach to range and pricing involves harnessing the power of data alongside the expertise of our experienced team. We curate our ranges and manage our pricing structures using data to pinpoint our optimal range of Stock Keeping Units (SKUs) and affordability. The way our teams work with data enables us to proactively respond to shifting customer preferences through forecasting, price optimisation, and range continuity.

This year we launched Group Marketplace initiative, which extends our Marketplace range into The Warehouse website and app, New Zealand’s No.1 retail site by traffic, by integrating products from TheMarket. com. With over 103,000 thirdparty products from 71 third-party merchants now available to our existing online customer base, we’ve delivered $8.9 million additional sales through Group Marketplace.

In the current economic climate, our Price Perceptor products continue to be a key driver for our customers, with The Warehouse delivering strongly through our Everyday Low Price (EDLP) positioning. For example, The Warehouse recently introduced a new value range of Samsung and Dyson products, offering a curated selection of quality appliances at affordable prices. The Warehouse also maintained its No.1 position in value perception across key competes in FY23.1

With the surge in food prices over the last year, presenting a challenging reality for most New Zealanders, our commitment to providing access to essentials at affordable prices such as food, pet care, baby care, and household basics remained unwavering.

Our strides in grocery at The Warehouse have been significant, with grocery sales growing 26.1% to make up 18.7% of total The Warehouse sales. Within this category, we experienced 91.8% growth in pantry and chilled, 26.6% growth in household cleaning items, and 23.8% growth in pet care. We have expanded our range and our private label Market Kitchen, launching butter, coffee and sauces at excellent price points. We have also ventured into a trial to offer fresh bulk fruit and vegetables at affordable prices in 12 of our stores. We remain committed to value and staying in tune with what our customers are looking for from our brands.

2. Helping customers to enjoy fast, easy and reliable ways to get what they need

Our focus remains on ensuring availability and efficient fulfilment through our integrated supply chain, enabling our customers to access the right products quickly, sustainably and at affordable prices.

For product availability, we’ve refined our assortment selection processes, optimising ranges for each category while upholding Everyday Low Prices. In FY23, significant progress was made in redesigning our delivery and fulfilment network.

2. Helping customers to enjoy fast, easy and reliable ways to get what they need

Our focus remains on ensuring availability and efficient fulfilment through our integrated supply chain, enabling our customers to access the right products quickly, sustainably and at affordable prices.

For product availability, we’ve refined our assortment selection processes, optimising ranges for each category while upholding Everyday Low Prices. In FY23, significant progress was made in redesigning our delivery and fulfilment network.Our new Warehouse Management System has enhanced visibility and control over stock flow, and we’ve continued to work on optimising forecasting, planning and transportation.

This year has seen a global decline in online shopping post COVID-19, with customers showing a preference for in-store shopping. Our Group online sales have returned to pre-COVID-19 levels, achieving $376.4 million. This represents 10.9% of total Group sales (including Gross Merchandise Value (GMV) sales through TheMarket.com and Group Marketplace), compared to 16.8% in FY22. The Warehouse contributed $119.0 million (6.3% of its total sales, and Noel Leeming contributed $118.1 million (11.1% of its total sales).

Our customers still enjoy our same-day Click & Collect offering at The Warehouse and 1-hour at Noel Leeming. Click & Collect accounted for $156.6 million in FY23, representing 51.8% of total omnichannel online sales.

Online shopping and Click & Collect continue to play an important role in helping our customers get what they need quickly and effortlessly

3. Helping customers to have access to affordable solutions that help them live sustainably

We are committed to helping make sustainable living easy and affordable for our customers. Last year, we shared our ambition to increase the share of private label products and packaging that are sustainable or circular to 50% by 2025 and 100% by 2035. In addition, we’re committed to reducing our Group’s Scope 3 emissions – those generated by our suppliers – by 50% by 2035 and 80% by 2040.

3. Helping customers to have access to affordable solutions that help them live sustainably

We are committed to helping make sustainable living easy and affordable for our customers. Last year, we shared our ambition to increase the share of private label products and packaging that are sustainable or circular to 50% by 2025 and 100% by 2035. In addition, we’re committed to reducing our Group’s Scope 3 emissions – those generated by our suppliers – by 50% by 2035 and 80% by 2040.

We know sustainable choices matter to our customers. In FY23, 33% of our private label sales were from products that featured one or more sustainable materials or production attributes, up from 22% in FY22. This accounted for 46,637 individual product lines and sales value of $343 million. Also, 43% of our private label sales were derived from products with sustainable packaging, a significant increase from 22% in FY22.

We have continued to grow our instore circularity solutions, including soft-plastic recycling in 44 The Warehouse stores, e-waste and mobile phone recycling in 33 Noel Leeming and Warehouse Stationery stores, and ink and toner recycling in 131 Noel Leeming and Warehouse Stationery stores.

By making sustainable products and solutions more accessible for our customers, we’re taking significant strides towards achieving our vision.

4. Helping customers to feel recognised and rewarded

Growing customer engagement and nurturing relationships are fundamental in the world of retail. At The Warehouse Group, our efforts are dedicated to delivering what our customers want and need through our portfolio of brands, ensuring they keep choosing us.

MarketClub sits at the heart of our customer engagement strategy, offering customers added value and discounts. Since its October 2021 launch, MarketClub’s growth has been exceptional, growing to over 1.3 million members at the end of FY23, an increase of 122% on FY22.

4. Helping customers to feel recognised and rewarded

Growing customer engagement and nurturing relationships are fundamental in the world of retail. At The Warehouse Group, our efforts are dedicated to delivering what our customers want and need through our portfolio of brands, ensuring they keep choosing us.

MarketClub sits at the heart of our customer engagement strategy, offering customers added value and discounts. Since its October 2021 launch, MarketClub’s growth has been exceptional, growing to over 1.3 million members at the end of FY23, an increase of 122% on FY22.

We have been encouraged by the rising number of The Warehouse customers opting to join MarketClub. In FY23, our members saved nearly $18 million through MarketClub deals. Our most popular MarketClub deal was our $4 and $5 Tararua 500g butter, which was enjoyed by over 220,000 members.

As we introduce new features and brands, the expansion of MarketClub across the Group remains a central focus. We envision considerable growth potential for the programme in the future, as the platform gets smarter and learns what our customers love from our brands. Our commitment to investing in MarketClub remains steadfast, as it’s a key driver of customer value and growth.

5. Helping customers get easy and high-quality customer service every time

Providing great customer service, both online and in store, is crucial to our customers’ experience. With customers using our online platforms for research and inspiration, and buying in-store more, we’re working to make sure we have the right people in the right places to give our customers the service they expect.

We’re pleased to see that our weighted-average in-store Net Promoter Score (NPS) for the Group, which measures customer satisfaction, increased in FY23 to 76.3, a 2.6 point increase on FY22.

5. Helping customers get easy and high-quality customer service every time

Providing great customer service, both online and in store, is crucial to our customers’ experience. With customers using our online platforms for research and inspiration, and buying in-store more, we’re working to make sure we have the right people in the right places to give our customers the service they expect.

We’re pleased to see that our weighted-average in-store Net Promoter Score (NPS) for the Group, which measures customer satisfaction, increased in FY23 to 76.3, a 2.6 point increase on FY22.

We continue to improve our stores across our network to make it easier and quicker for customers to find what they need, and we continue to upgrade our systems to support our customers better. Our team members are rostered to work where and when they’re needed, thanks to our Group Workforce Management Solution that collaborates with other systems. Our ERP systems will help us predict demand, plan, and budget accurately. We’ve successfully implemented our agile model in stores and in the field to adapt to changing customer needs and allocate resources effectively

  1. Source: The Warehouse Group Brand Tracker. The Warehouse leads on “has good everyday prices”, “is easy to find great value” and “has great deals” perceptions vs key competes.
  2. Online sales includes online sales through omnichannel brands and Gross Merchandise Value (“GMV”) sales through TheMarket. com and Group Marketplace.