Latest data from NielsenIQ shows grocery sales at UK supermarkets tumbled in the first week that pubs and restaurants reopened for indoor trading. However, demand remained elevated with many households still choosing to shop online despite the easing of lockdown restrictions.
Total Till sales fell 2.7% in the four weeks ending 22 May, with grocery sales declining by 6.7% during the final week when the hospitality sector reopened. This also coincided with a summer heatwave and an earlier late May bank holiday last year.
However, despite the fall in grocery sales, food retail sales increased almost 11% compared with the same period in 2019, with shoppers spending £9.1bn over the four weeks. The NielsenIQ data also shows that visits to stores were up by 20% compared to the same period last year as travel restrictions eased and people became more confident as Covid-19 cases fell.
With more frequent visits, spend per visit fell to £17.40 from £21.50 in May 2020. Shoppers were also be spending more at travel outlets and other food-to-go establishments.
The NielsenIQ data also suggests that consumers are continuing to embrace online grocery shopping, with 28% of households still shopping online in the latest four week period – the same figure as a year ago – and considerably more than the 17% in May 2019. Moreover, the online share of grocery sales remained strong at 13.8% – exceeding the 13.4% market share recorded in May 2020, but a slight decline on last month’s figure of 14.2%.
In terms of category performance, delicatessen (+18.6%) was the fastest growing super-category followed by health & personal care (+16.2%), and bakery (+10.8%). This is as a result of lockdown restrictions easing, with more opportunities to socialise outdoors and many people returning to the office. As a result, frozen food sales saw the biggest decline (-14.9%) as well as packaged grocery (-10.1%) alongside beers, wines and spirits (-6.7%), as consumers returned to visiting pubs and restaurants.
In the last 12 weeks, Lidl (+17.3%), Aldi (+9.5%) and M&S (+7.6%) were the strongest performers, whilst Sainsbury’s (+0.4%) was the fastest-growing retailer out of the Big Four supermarkets, just ahead of Tesco, Asda and Morrisons.
Mike Watkins, NielsenIQ’s UK Head of Retailer and Business Insight, commented: “Despite lockdown restrictions easing, it is evident that online grocery remains popular with British consumers, with almost one in three households still choosing to shop online. This suggests that the shift of spend to online that we saw over the last year is now a more permanent fixture for many and part of regular grocery shopping routines. With supermarkets placing more investment in their rapid delivery and fulfilment, shoppers are no longer seeing this only as an option for one large shop. Usage is evolving to meet a wider range of shopper needs and meal occasions, no matter the basket size.”
He concluded: “Looking ahead, the challenge for food retailers is to reassess shopping behaviour now when their customers have opportunities to spend elsewhere across leisure, hospitality and travel, particularly when restrictions are permanently lifted at the end of the month. However, with the start of warm weather, Euro 2021 on the horizon, and the likelihood of more stay at home UK holidays, there will still be opportunities for supermarkets to increase basket spend and improve sales as we head into the summer months.”
