Grocery sales higher than pre-pandemic levels

Take-home grocery sales are significantly higher than pre-pandemic levels, despite falling by 5.1 per cent over the past three months.

According to the latest Kantar retail sales, shoppers spent £3 billion more on groceries than they did during the same period in 2019.

Despite a huge month for British football, many fans chose to watch the game in pubs and bars, which meant that take-home sales of alcohol over the four weeks to mid-July were down by 3 per cent compared to the previous month.

“That said, shoppers still spent £1.2 billion on the category – a 24 per cent increase on the same period in 2019,” said Fraser McKevitt, head of retail and consumer insight at Kantar. “Crisps and snack brands also enjoyed a boost from those of us who gathered round to watch the games at home and sales grew by 23 per cent compared with two years ago.”

Online shopping

The Kantar research shows that the number of people choosing to buy groceries online fell by 81,000 in July compared to the same four weeks last year.

Digital baskets also shrunk by 8 per cent to an average of £80 per shop, the lowest since February 2020.

As a result, year-on-year sales growth for online groceries has dropped for the first time ever – falling by 2.6 per cent. The channel currently accounts for 13.3 per cent of the total market.

Grocery market share

Ocado’s growth has slowed over the past three-months to 3 per cent, although it does remain the fastest growing retailer, increasing its market share by 0.1 per cent to 1.8 per cent.

“A number of the grocers saw sales fall this month but there were notable gains for some,” explained McKevitt. “Waitrose, with sales up by 0.1 per cent over the 12 weeks to 11 July, was the only retailer with a bricks and mortar estate to achieve year-on-year sales growth.”

He added: “Waitrose lost shoppers last year when people focused more on picking up essentials and limiting trips outside the home. But as the nation becomes more confident and starts to buy groceries from multiple places again, it has outpaced its peers with increasing footfall and as a result its market share rose by 0.3 percentage points to 5 per cent.”

Aldi and Lidl both won market share during the period.

Aldi gained 0.4 per cent to hold 8.2 per cent, while Lidl’s share of the market increased by 0.2 per cent to 6.1 per cent.

Tesco won its biggest year-on-year share increase since December 2016 this period, growing from 26.7 per cent last year up to 27.1 per cent in the latest 12 weeks.

Sainsbury’s, where online sales continue to perform strongly, moved its share up to 15.2 per cent from 14.9 per cent last year.

Asda’s share slipped by 0.1 per cent to 14 per cent and Morrisons fell from 10.3 per cent last year to 10.1 per cent this period.

“Morrisons has made plenty of headlines this month following private equity interest in the business; a change of ownership in the near future looks to be highly likely,” said McKevitt. “Following a year of solid sales performance, shoppers are clearly pleased with what the Bradford-based grocer has offered.”

He concluded: “It sets itself apart from the competition through its distinctive fresh counters and a continued use of multibuy promotions. While other retailers have cut back on counters, 14 per cent of Morrison’s shopping trips include loose meat, fish, dairy, or delicatessen items from its Market Street sections, more than double the market average. Over 30 per cent of promotional sales in Morrisons are multibuy offers, requiring the customer to buy two or more items. This is in contrast to its big four rivals which have largely focused efforts on price cuts.”

Iceland, Co-op, and independent stores all received a boost in the early days of the pandemic as people shopped closer to home. In comparison with the highs of 2020, these grocers’ market share has inevitably fallen this year but all three experienced double-digit sales growth compared with 2019.

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