Northerners warm to Ocado as sales leap in the region

Ocado's Northern sales rose 17 per cent
Ocado's Northern sales rose 17 per cent
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Ocado was Britain’s fastest growing grocer over the past 12 weeks and achieved its quickest growth in the North of England, according to the latest Kantar data.

More than half of the online retailer’s sales come from customers in London and the South, but its quickest growth was found outside of this heartland in the North where sales were 17 per cent higher.

Fraser McKevitt, head of retail and consumer insight at Kantar, said: "Ocado's customer base is overwhelmingly Southern. It is a certain demographic. It tends to be younger, it tends to be more affluent and Ocado as a business are rolling out their ability, upscaling their logistics to reach more people.

"It's a combination of the logistical ability to deliver, which is obviously so important when you're an online retailer. You literally have to have the distribution centres, the warehousing, the trucks on the road and when that becomes available, more people are willing to give it a go as more people shop online."

Ocado was once again Britain's fastest growing grocer with sales 11.2 per cent higher than this time last year.

In stark contrast, Bradford-based Morrisons was the worst performer of the big four, with sales down 3.0 per cent, whilst Leeds-based Asda saw sales fall 2.2 per cent.

Mr McKevitt said: "Morrisons are being hit in the same way as the rest of the big four. The market growth is so slow and if you're losing market share, which Morrisons are and indeed the rest of the big four are, that inevitably translates into year on year declines in sales.

"It's pretty tough for them. They have fewer shoppers coming through the door and those that are, are picking up fewer items in each basket, which makes it pretty tough for them at the moment."

He said that Asda is facing similar issues.

"Asda are managing to maintain the number of people coming through the door though, which is absolutely key," he added.

"They have had some own label successes and they have also moved quite quickly on the whole plant based thing with a completely new range. That is completely new. They weren't selling it at all last year.

"Extra Special also did well. They have rolled out more lines and that's one of the fastest growing premium own label lines. It's not something Asda is famous for, but it's well ahead of their big four rivals."

Kantar said that surging demand for non-alcoholic drinks and the increasingly popular Veganuary trend failed to halt sales declines among Britain's biggest supermarkets.

The latest data revealed muted sales growth of 0.3 per cent across the UK supermarket sector in the 12 weeks to January 26, with the big four players all suffering declines.

The report found that sales of non-alcoholic beer rocketed 37 per cent in the past three months, with a 3 per cent rise for adult soft drinks as many shoppers abstained for Dry January.

Despite this trend, it said more than 15 million households still bought alcohol during the past four weeks.

Subdued overall consumer demand saw the major grocery chains lose market share, with Tesco down to 27.3 per cent from 27.7 per cent a year earlier, Sainsbury's falling to 15.8 per cent from 15.9 per cent, Asda dropping to 14.9 per cent from 15.3 per cent, and Morrisons falling to 10.3 per cent from 10.6 per cent.

It follows the slowest festive growth since 2015, when supermarket sales rose by just 0.2 per cent in the 12 weeks to December 29.

Ocado managed to beat fast-growing discounters Lidl and Aldi, which saw sales rise 11.1 per cent and 5.7 per cent respectively.

Separate figures from Nielsen also showed sales grew by a "subdued" 0.7 per cent in the most recent four weeks to January 25.

This marks a significant decline on the 3.3 per cent growth seen a year earlier, Nielsen said.