The UK’s Co-op Group has announced plans to relaunch its membership programme this autumn.
The current ‘5 and 1’ scheme sees members receive a 5% reward for any purchases they make of Co-op own-brand products and services, with a further 1% directly benefiting local causes. The new plan will “significantly increase money going to community causes and charities”, and grow the personalisation of rewards and benefits for members. The Group also announced initiatives to improve colleague pay and benefits and boost diversity commitments.
The announcement was made alongside the society’s half-year results, which showed a revenue increase of 7.6% to £5.8bn (2019: £5.4bn) driven by food and wholesale performances, as customers shopped closer to home and ate out less frequently during lockdown. During the period, its underlying operating profit doubled to £121m (2019: £59m). Funeralcare revenues rose 3.5% to £148m with underlying profit increasing to £17m.
Legal Services revenue was flat year-on-year at £19m (2019: £19m) and registrations for its Co-op Health app were up 400%, reflecting a shift in customer behaviour during lockdown. By the end of July, the app was delivering more than 20,000 prescription items a month with 4.8/5 customer service rating.The society acknowledged significant costs incurred through Covid-19, and predicted a challenging second half.
Throughout the Covid-19 crisis, the retailer created 7,000 temporary posts to manage increased demand, and launched an online platform, Co-operate, linking volunteers and those in need. During the pandemic, the Group’s Member Pioneers supported more than 20,000 vulnerable people a month in communities, sourcing volunteers, securing funding for urgent projects and establishing support groups.
£15m of funds were given to charities and community causes as part of its Covid-19 response. This included £3.4m worth of advertising spend donated to FareShare, encouraging audiences to support food banks, and £4.5m from its current membership programme being donated to 4,000 local causes. During the period, the Group maintained pressure on the government to act under the Safer Colleagues, Safer Communities campaign, in aid of protecting shopworkers from violence and abuse.
Members, colleagues and communities
Against the backdrop of Covid-19, the Co-op has announced four initiatives to “make a real difference for colleagues, members, and communities”, building on co-operative commitments to democracy, equality, equity, and solidarity.
This includes improvements to colleague pay and benefits through creating a plan to align its hourly pay rate with the Real Living Wage, and doubling colleague member discount on own-brand products to 20% all year round, increasing discount across the full product range for 13 special payday events each year.
It has also announce new diversity and inclusion commitments, including a pledge to increase the percentage of leaders from black, Asian, or ethnic minority background from 3% to 6% by 2022 and 10% by 2025; alongside a requirement for a diverse shortlists for leadership roles and a commitment to working with the Co-op Academies Trust to develop curriculum on anti-racism with a long-term plan to lobby government for national roll out.
The Group is exploring new routes to work, including a plan to offer 150 of government Kickstart work placements to candidates in communities where opportunities are most needed, with the intention of making at least 50% of those placements permanent.
The fourth initiative is the planned re-launch of membership, with significant increase in money going to local causes and charities, which will be announced in full later in the year.
“We are living in unprecedented times, but the response of our Co-op has been exceptional and I’m immensely proud of my 60,000 colleagues who’ve helped to feed and care for the nation during this difficult period,” said Steve Murrells, Co-op Group chief executive. “We’ve shown how our co-operative approach to doing business provides enhanced value for our customer-members and the communities in which they live. At a time of crisis, our country needs a strong and progressive Co-op and these results evidence that we are ready to deliver even more for our key stakeholders.”
He added that the Group’s vision of “co-operating for a fairer world has taken on even greater resonance during this exceptional time, with the pandemic bringing to light inequalities and injustices which no longer feel remotely tolerable”.
“Being a Co-op has never felt more meaningful and right,” he said. “The role of business in society is changing and we are proud to lead the way. Everything we are doing points to a Co-op in tune with the communities in which it operates, one which is determined to innovate and drive change for the benefit of our members and the places where they live and work.
“The coming months and years remain uncertain, and we know our own Co-op will not be immune to the pressures the recession brings to family budgets and to local and national economies. We will continue to invest within our core businesses to ensure that our Co-op value resonates within Co-op households and local communities.”