Latest data from Nielsen shows growth in the UK grocery sector has continued to slow, increasing by just 0.4% in the last four weeks, costing supermarkets over £120m in missed sales.
The slowdown in growth is attributed to the poor weather in recent weeks. The cool and wet conditions caused shoppers to hold back spend and purchase fewer items than they would during warmer weather conditions – as experienced during the same period last year.
The Nielsen data showed that over the last 12 weeks, sales at the big four supermarkets were flat or in slight decline, with the strongest sales at the Co-op (+1.9%), Iceland (+2.2%), Aldi (+9.4%) and Lidl (+15.2%). Tesco continues to dominate in market share (26.5%), but Nielsen highlighted that the rising combined market share of Aldi (9.5%) and Lidl (6.4%) places the combined discounters in second position, overtaking Sainsbury’s (14.3%) and Asda (13.6%).
Mike Watkins, Nielsen’s UK Head of Retailer and Business Insight, commented: “It’s clear that promotions, events and the vagaries of the weather have a big impact on supermarket sales. The summer trading season stretches 18 weeks from the first May bank holiday to the last week in August. In the first seven weeks of summer 2019, shoppers have so far spent £350m less in supermarkets. This equates to a 2.1% fall in value sales compared to the same time period last year.
“This means that for supermarkets to match the same level of sales as last summer, shoppers would now need to spend £26bn during the remaining 11 weeks. This looks a tall order as weekly growth is currently down, and we would need a sustained heatwave through to August, as we had last summer, just for the growth at supermarkets to stand still.”
% share of grocery market spend by retailer and value sales % change
NAM Implications:
- Still seems to be a story of Aldi and Lidl growing at the expense of the mults, come rain or shine…
- …begging the question whether the mults can ever return to former glory?
