The latest grocery market share figures from Kantar Worldpanel, for the 12 weeks ending December 4 2016, reveal a particularly strong performance for premium own label ranges in the run-up to the festive season.
Shoppers are spending 13 per cent more on these lines than they did last year, against a backdrop of continued slow growth for supermarkets overall, where year-on-year sales increased by just 0.7 per cent.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said: “Top-tier private label finds its way into 12 per cent of shopping trips, with 88 per cent of consumers now buying from these lines.
“In the past 12 weeks, 6.3 per cent of own label purchases were from premium lines such as Tesco Finest and Sainsbury’s Taste the Difference, well ahead of the 5.7 per cent recorded last year.
“We’ve seen particularly impressive performances from Morrisons’ The Best, which saw sales increase by 35 per cent, and Asda Extra Special which grew by 15 per cent.
“Over Christmas it’s likely that premium lines will record their highest ever sales figures as even more shoppers trade up to treat their loved ones.
“Despite widespread anticipation of higher prices, shoppers are yet to feel the pinch of rising inflation, with a typical basket of everyday groceries 0.1 per cent cheaper than this time last year. However, some categories are beginning to see prices increase, with fresh fish up 5.3 per cent year-on-year, chilled ready meals up 2.3 per cent and beer up 2.1 per cent.
“Prices are still falling overall despite shoppers now spending less on promoted items than they did this time last year.
“Some 36.9 per cent of spending was on offers during the past 12 weeks, down from nearly 40 per cent in the 12 weeks to December 2015.
“Promotional activity has dipped across all five of the biggest retailers, reflecting ongoing efforts to simplify shopping and offer more of an everyday low pricing model, which relies far less heavily on promotions.”
Aldi was the only retailer to record double-digit sales growth over the past 12 weeks; its premium Specially Selected brand helped the discounter increase sales by 10.0 per cent year on year, according to Kantar.
As a result, Aldi’s share of the grocery market has increased by 0.6 percentage points to 6.2 per cent. The next fastest-growing retailer was Iceland, with an 8.6 per cent sales uplift contributing to a 0.2 percentage point increase, which brought the grocer’s share of the market to 2.2 per cent.
Other retailers growing sales over the past 12 weeks include Lidl, which saw a 5.7 per cent uplift, Co-op, which saw an increase of 2.0 per cent, and Waitrose, which saw its sales rise by 1.1 per cent year on year.
Mr McKevitt continued: “Tesco’s volumes sales are growing faster than its value sales, particularly in the meat and fresh produce categories.
“Its value sales remain ahead of the market, increasing by 1.6 per cent year on year as the retailer grew its market share to 28.3 per cent.
“Sales at Sainsbury’s fell by 0.6 per cent, with market share down 0.2 percentage points to 16.5 per cent, while Asda saw sales fell by 4.7 per cent at a marginally slower rate than in recent months. Reflecting a smaller store estate, Morrisons’ overall sales declined by 1.4 per cent, but the retailer saw particularly strong performance online – recording its highest ever sales in that channel.”
Kantar Worldpanel monitors the household grocery purchasing habits of 30,000 demographically representative households across the UK.
Grocery inflation stood at -0.1 per cent for the 12-week period ending December 4 2016, according to Kantar Worldpanel’s latest data.
This means shoppers are now paying less for a representative basket of groceries than they did in 2015, Kantar said. This is the 29th consecutive period of grocery price deflation.
In its latest report, Kantar said: “Falling prices reflect the impact of Aldi and Lidl and the market’s competitive response, as well as deflation in some major categories such as pork, deodorants, eggs and vegetables.”
Kantar Worldpanel’s grocery inflation figure is based on more than 75,000 identical products, which are compared year-on- year in the proportions they are purchased by shoppers.