Grocery market growth at 11 year low
New figures have shown that the overall grocery market grew at its lowest rate for at least 11 years in the 12 weeks to 27 April.
Figures published by Kantar Worldpanel reveal that the market grew by just 1.9% in the period due to intensifying price competition between supermarkets and a resulting drop in price inflation.
Edward Garner, director at Kantar Worldpanel, explained: “There are clear signs that the major supermarkets are reviewing their strategies in the face of increasing competition. We’re now seeing the big four moving away from ‘here today, gone tomorrow’ promotions and toward everyday low prices – with Tesco, Morrisons and Asda all announcing price cuts this month.”
Waitrose, Aldi and Lidl all achieved new record shares in the period of 5.1%, 4.7% and 3.5% respectively. Aldi’s growth rate for sales of 36.1% was an all-time record for the retailer while Lidl’s 20.9% growth was its highest since August 2004.
Among the big four supermarkets, Asda proved the most resilient by holding its 17.3% market share and narrowly beating the market with 2% year-on-year growth. Tesco, Sainsbury’s and Morrisons all suffered declines in their market share while Tesco and Morrisons also recorded a fall in actual sales.
Garner continued: “The proportion of sales on promotion currently stands at 45% among the big four. By contrast, the figure at Aldi is just 3%. Tesco now states ‘Prices down and staying down’, Asda features ‘Price lock’, Morrisons introduced ‘I’m Cheaper – everyday low prices’ and the Co-operative has adopted ‘Fair and Square’ pricing in a move to give shoppers lower everyday prices with greater transparency. Lower prices across the board is great for shoppers, but has driven down market growth to its lowest level in 11 years.”
