The latest grocery market share figures for Ireland from Kantar show overall sales fell by 2.2% year-on-year in the 12 weeks ending 3 October as the industry continued to face tough comparisons with the bumper levels of food and drink shopping during the lockdowns in 2020. However, spending remains 9.4% higher than pre-pandemic levels in 2019.
Emer Healy, retail analyst at Kantar, commented: “It’s a nuanced picture in the grocery market at the moment. The lifting of social restrictions and high vaccination rates mean shoppers are more comfortable going out and visiting physical stores, but they also mean people’s social calendars are filling up again. More socialising means we’re living less regimented lives, and with more eating at restaurants, pubs and on the go, the reliance which many had on supermarkets to get their meals last year is starting to fade. That is evidenced in the latest four week ending data, which shows supermarket trips are falling by 4.5% year on year and the amount bought per visit is also down 0.9%.”
Meanwhile, busier routines and less time to shop in-store meant that many people turned to online shopping again. The latest four weeks saw online sales jump 7.1% year-on-year, adding €3m to the market.
A further loosening of social restrictions in Ireland on 22 October is not expected to herald major changes for the grocery sector. Healy said: “The relaxation of restrictions in Ireland has been a gradual process and people have already been enjoying increasing freedoms, with knock-on effects at the supermarket tills. We expect many office workers to continue to work flexibly, which will mean a mix of both in home and on-the-go eating at lunchtime. People are already back visiting pubs and restaurants too, so there shouldn’t be a major change in that sector either.”
Kantar highlighted that shoppers are likely to start keeping a close watch on their grocery spending after the past 12 weeks brought the highest levels of inflation in the market since March. Prices are 0.6% higher than a year ago, with healthcare, hot beverages and frozen food the most affected categories – up 8.0%, 5.1% and 4.6% respectively.
Despite prices going up, consumer confidence appears to be high. Dunnes was the only retailer to recruit new shoppers this period as it and Tesco found favour through more premium items.
Healy commented: “Dunnes typically has its most successful months in the autumn as shoppers favour branded items and take shelter from the elements in its shopping centre locations. New customers contributed an additional €26.2m to its performance and Dunnes now accounts for 21.9% of grocery sales. Tesco’s market share increased 0.5 percentage points to 21.4% and it also enjoyed success through branded items – it saw customers spend an additional €13m on well-known names this period.”
SuperValu continued to hold the largest share of the grocery market after making a 0.4% gain. Its shoppers visited more frequently than any other retailer – on average 21 times in the past 12 weeks. Aldi was boosted by store openings across the country and welcomed a second consecutive month with a record-breaking share – now at 12.8%. It grew especially well in Connaught and Ulster, with sales up 6.9%, the strongest among all retailers.
NAM Implications:
- All the usual suspects re impact on performance.
- With some of the Lockdown pipeline pain still to emerge in terms of impact on jobs and inflation…
- …the discounters continue their march.
- Meanwhile, Dunnes echoed UK retailer experience of traditional brands growing at the expense of private label…
- …as did Tesco.
- Meanwhile, SuperValu takes pole position…
