Greggs vegan sausage roll boosts sales

Greggs - getting a taste for vegans

Greggs has credited the fanfare around the launch of its vegan sausage roll for driving a sharp rise in sales.

The bakery chain said the publicity the snack gained helped sales surge 9.6% in the seven weeks to 16 February.

The snack, made from meat substitute quorn, launched at the start of the year, coinciding with Veganuary when many people go vegan for a month.

The update on current trading came as the firm said annual sales had broken through £1bn for the first time.

Chief executive Roger Whiteside said Greggs had spent "millions of pounds" transforming how people perceived the chain.

"We want people to reappraise us and understand we've moved on from being a pure bakery business to offering people food on the go," he told the BBC's Today programme.

People wanting "healthier food options" could now find them at the chain, he said.

• Greggs and the 'sausage roll' masterstroke

Mr Whiteside said the chain, which has already held one-off evening openings for events such as Valentine's Day, was also "looking to move into the evening food market".

Greggs now has 1,953 stores across the UK, and Mr Whiteside said it planned to get to 2,000 stores by the end of the year.

Pre-tax profit last year rose 15% to £82.6m, marking the fifth year in a row that profits have increased.

The firms's shares have almost doubled in value since July last year.

"There's a lot to like about Greggs - it's a publicity machine, recession-proof, and has a knack for adapting to consumer habits," said Arlene Ewing, Investment Manager at Brewin Dolphin.

Much of the chain's success has been driven by savvy marketing.

The ad campaign for its vegan sausage roll has been called "a master class in public relations" by the industry magazine PR Week.

Journalists were sent vegan rolls in mock iPhone packaging and stores sold sausage roll phone cases.

Publicity surrounding the campaign exploded when Piers Morgan, presenter of ITV's Good Morning Britain, criticised the new snack, calling Greggs "PC-ravaged clowns" in a tweet.

Analysis

by Dominic O'Connell, Today business presenter

When daytime TV host Piers Morgan poured scorn on the vegan sausage roll, Greggs' social media team was ready to roll.

"Oh hello Piers, we've been expecting you," was the immediate tweet, a James Bond-inspired, gently droll putdown that was the perfect riposte.

Greggs marketing and social media may be quirky and fun, but there is a deadly serious intent behind it - to push customers into what the company calls a "reappraisal" - a realisation that Greggs is no longer just a bakery chain, but a fast-food and even dining proposition that competes with everyone from McDonald's to Patisserie Valerie.

Come to try the vegan sausage roll, and come back when you realise the coffee is cheap and (hopefully) not disgusting.

This hard work is evident in the results - a decent increase in pre-tax profits, and, best of all for investors, the prospect of a special extra dividend later in the year.