High inflation was a main driver of customers’ behaviour. Discount stores and cheaper chains are the main attraction points in times of uncertainty.
German discount supermarkets were notable beneficiaries: Lidl was the fastest growing supermarket, with a 26% increase in sales and a 7.4% market share, up from 6.4% a year earlier. Aldi also achieved a new record market share of 9.9%, up from 8.6% previously, while sales increased by 25%.
Asda’s revenue increased 7.3% from GBP 4.23 billion to GBP 4.53 billion, outperforming ‘Big 4’ competitors Tesco PLC and J Sainsbury PLC, both of which achieved 6.9% more revenue. However, Tesco remained the largest UK grocer, with market share falling from 27.4% to 26.9% and sales rising from GBP 7.98 billion to GBP 8.53 billion.
Sainsbury’s also saw its market share fall from 15.1% to 14.8%, with sales rising from GBP 4.39 billion to GBP 4.69 billion, while Asda’s share fell from 14.5% to 14.3%. Wm Morrison Supermarkets saw its UK market share fall further from 9.5% to 8.8%.
Ocado Group PLC’s revenue continued to increase by 7.3% to GBP579 million from GBP539 million, while its market share remained the same at 1.8%.
Waitrose’s market share fell to 4.5% from 4.8% and Co-op’s to 5.7% from 6.0%. Meanwhile, Iceland’s share rose from 2.2% to 2.3%.
McKevitt of Kantar said UK supermarkets are joining consumers in the fight against grocery price inflation to maintain their presence, including through the use of loyalty cards to entice and retain customers.
“The supermarkets are also struggling with the inflation of grocery prices and are fighting to demonstrate value and bring in customers. This is a highly competitive sector, and if the prices in a particular store do not please, people go to another store. On average, consumers visit three or more of the ten largest retailers in a given month,” McKevitt said.
“Store cards have become an important way to add value to the high cost of living, with grocers offering cheaper prices, coupons and points for people who scan them at checkout. Our latest data shows that more than nine in ten of us have at least one loyalty card in our wallets and that its use is increasing.”
According to McKevitt, branded items are shunned in favor of house brands, as shoppers want to reduce the cost of their groceries.
However, he added, “People keep some space in their basket for the brands they know and love. Outside of discounters Aldi and Lidl, branded goods still account for 52% of the market, and sales increased by 7.2% over the past month, the fastest pace we’ve seen since February 2021. Many brands innovate and bring new products to the shelves to maintain their popularity, and 10% of their sales in the past year came from new or renewed items.”
While the availability of fresh fruit and vegetables has been a concern on UK supermarket shelves lately, Kantar’s latest data shows that shoppers are not without it.
“Despite concerns about shortages, the number of baskets of tomatoes, cucumbers or peppers in the 10 largest supermarkets remained at 17% in March, the same as in February,” McKevitt said.
“For shoppers who could not get what they wanted in the larger supermarkets, the independent stores came into action: the number of tomatoes, peppers and cucumbers in baskets increased in these stores by 32%, 26% and 21%, respectively.”
