The short version: Incoming WW CEO could receive massive performance bonus – but he must double the company’s value first

Well, well, what is this? Incoming Woolworths CEO, Sam Ngumeni, has been given one heck of a performance incentive. In what the business is calling an ‘Outperformance Share Award’, Mr N will receive a special ‘once-off’ bonus if certain targets are met over the next five years – stuff like doubling the current share price, growing the company’s earnings by 10% to 15% per year, and other metrics. Fair enough. But putting some figures behind the incentive shows the real magnitude of the task and the rewards at stake. The company has issued Ngumeni nearly 1 million Woolies shares, which will be kept in a safe place for five years. The shares are currently worth around R51 each (i.e. a total of around R50m). If the share price doubles by 2031… well, you do the math. Ok fine, we’ll do it for you… Mr Ngumeni becomes a 100-millionaire. How realistic is this to achieve? Pretty tough, TBH – some would prefer to call them “stretch goals” because it means that the company would have to do a lot better than it has done in the last five to 10 years. The last time Woolies’ share price was at R100 was back in 2015, and we don’t need to remind you just how much the world and our local FMCG landscape has changed since then. And as for the 10-15% growth in earnings? Well, over the last few years, Woolies’ earnings have been flat, if not declining. Calling this a tall order would be a gross understatement.

The short version: FMCG retailer loyalty programmes are the most popular in South Africa, with Checkers and Clicks coming out tops

The 10th Truth & BrandMapp Loyalty Whitepaper is out, which over the last 10 years has given us a view of which loyalty programmes South Africans engage with the most. This year, the study draws info from 30,000 “economically active” respondents (defined as those with a gross household income of R10,000 per month), as well as 6,000 “mass market” consumers (those earning less than R10,000 per month) who are digitally connected and use online services such as online banking and e-mail. The whitepaper looked at programmes from all industries (retail, financial services, fuel, travel, restaurants/QSRs, etc.), with our great industry coming out firmly on top, showing the dominance not just of retail loyalty programmes, but more specifically those in FMCG. The winners are:

Most used loyalty programme by the ‘economically active’ group:

1) Checkers Xtra Savings (with 79% of respondents using it) 

2) Clicks ClubCard (78%)

3) Pick n Pay Smart Shopper (68%)

Followed by Dis-Chem, SPAR, Woolworths and Shoprite, in that order. 

Most used loyalty programme by the ‘mass market’ group:

1) Clicks ClubCard (with 68% of respondents using it) 

2) Checkers Xtra Savings (62%)

3) Pick n Pay Smart Shopper (56%)

Followed by Shoprite, SPAR and Dis-Chem.

Unsurprisingly, retail loyalty programmes are used more by women than by men, and when considering the young‘uns, Clicks ClubCard comes out on top for 18- to 24-year-olds (73% of this group use it), followed by Checkers Xtra Savings (68%) and Pick n Pay Smart Shopper (53%). What benefits do users enjoy the most? Among the economically active, it’s cashback and points that can be used as cash, while for the mass market, cashbacks remain in the top spot, followed by birthday offers. What about the 18- to 24-year-olds? Educational courses and donations to charity come out on top, signalling the importance this group places on their employability and social causes.

The short version: Pick n Pay receives African loyalty award | The Salzmans pull back from Dis-Chem (again) | Makro’s new ‘Bar Code’

Still on the topic of loyalty, Pick n Pay Smart Shopper has been named ‘Best Retail Loyalty Programme of the Year in Africa’ at the inaugural African Loyalty Awards. Backed by the African Loyalty Association, the awards celebrate impactful loyalty, with entries from East, West, Central and Southern Africa. ‘Best Partnership Programme of the Year’ also went to Pick n Pay, and bp, which have been collaborating on their fuel rewards partnership since 2018.

Still on the topic of shares (see Woolies story above), the Salzman family has taken yet another step back from the business it founded, Dis-Chem, with sons Dan and Mark Saltzman selling off a smallish portion of their shares – by smallish we mean R640million’s worth out of the R7billion they own. Dan and Mark do not sit on the board, nor do they work for the company. But more importantly for our story, perhaps, their father, Ivan, will step down as executive director in June and move to a non-executive director deputy chair role.

Finally, Makro is launching a new liquor tasting event known as ‘The Bar Code by Makro’, where customers will enjoy guided tastings and product showcases of the wine, spirits and beer available at Makro. ‘The Bar Code’ will be a roaming event held quarterly at select stores, with the first one taking place at Makro Riversands in Midrand this Saturday, 28 March. Doors open from 10am – because it’s happy hour somewhere in the world at that time, right?

The short version: Competitor rules may change for Aldi and Lidl | Kroger and Albertsons still in court

There’s a grocery market regulation in the UK known as the ‘Controlled Land Order’ whereby businesses designated as “Large Grocery Retailers” (such as Tesco, Asda, Sainsburys, Morrisons, etc.) may not make use of restrictive land agreements to prevent competitors from opening in their vicinity. When the regulation came into effect in 2010, discounters Aldi and Lidl were not considered “large” enough for the regulation to apply to them. But things are very different 16 years on, prompting the body which regulates these things, the Competition and Markets Authority, to review the rules. Interested parties have until mid-April to comment, with the final verdict to be published in September this year. 

Over in the US, the merger divorce between supermarket giants Kroger and Albertsons continues to be a messy one. We take a step back to refresh our memories – following the failed merger between the two in December 2024, Albertsons filed a suit against Kroger, claiming that the latter did not use “best efforts” to get the deal signed and sealed, resulting in Albertsons losing the heaps of money it had spent to get the merger through. Over a year later, the suit is still ongoing, with the latest development that Albertsons has filed a subpoena to get former Kroger CEO Rodney McMullen on the stand to determine if he really did put a spanner in the works. McMullen, you may recall, resigned rather abruptly just a couple of months after the ill-fated merger collapsed, after an investigation found that he contravened the business’s ethics policy. The plot thickens…