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Coronavirus warning for Coles' latest Stikeez campaign

Image: AP

Coles’ latest Stikeez campaign could be hampered by coronavirus fears compounded by Australia’s drought crisis, a prominent economist has warned.

The coronavirus has so far claimed 1,500 lives, and seen shops like Coles sell out of hand sanitiser as anxious Australians buy up big. But it’s not just hygiene habits that will be impacted. 

Coronavirus will also affect Australians’ shopping habits at a time when supermarkets are already struggling, AMP Capital senior economist Diana Mousina told financial comparison site Canstar. 

“Coronavirus will definitely have an impact on food spending over the next few months,” Mousina said.

“But it’s a temporary impact that is likely to be more than offset in the second quarter.”

That in turn will affect the success of Coles’ Stikeez campaign. The new campaign adds dairy, proteins and grains to the fruits and vegetables already part of the campaign, and promotes the Fresh 5 Challenge, which encourages children to eat from all five food groups. 

According to Coles’ chief marketing officer Lisa Ronson, the Stikeez campaigns have helped boost children’s vegetable intake, and the supermarket giant’s bottom line. 

“Customers have told us they use Stikeez as a fun tool to encourage kids to eat more types of fresh foods – our research showed that 31 per cent of customers who collected the first Stikeez range increased their purchases of fruit and vegetables and 50 per cent bought a wider variety of fresh produce,” she said. 

“Kids who had never touched broccoli or tasted a fresh tomato found it fun to challenge themselves to eat foods of all colours of the rainbow.”

And Coles Group has also noted the Little Shop and Stikeez campaigns contributed to sales revenue growth of 3.2 per cent over 2019. 

But a sharp reduction in tourist and international student numbers, thanks to the double whammy of the coronavirus travel ban and Australian bushfires, has the power to hit households and trickle through to spending. 

Grocery prices are also expected to go up due to the drought and bushfires impacting supply and logistics, peak vegetable industry body AUSVEG has warned. 

Those challenges could push fresh fruit and vegetable prices up by 50 per cent in a worst-case scenario, spokesperson Shawn Lindhe told Yahoo Finance in January. 

Coles, Woolworths stocks a safe bet

While this iteration of Stikeez might not be as successful as previous versions, Coles trades in non-discretionary and staple items, meaning it’s one of the safest investment options to ride out coronavirus, Jason Beddow, the managing director of Argo Investments said.

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