Grocery take-home sales rose 5.2% in the 12 weeks to October 30, 2022 according to the latest figures from kantarthe fastest market growth rate since April 2021. Four-week grocery price inflation has also hit another record since Kantar began tracking prices this way in 2008, now standing at 14 .7%.
Fraser McKevitt, head of retail and consumer research at Kantar, comments: “Once again we have a new record figure for grocery price inflation and it is too early now to call the top. Consumers face a £682 increase in their annual grocery bill if they continue to buy the same items and just over a quarter of all households. [27%] now they say they are in financial difficulty, which is double the proportion we recorded last November. Nine in 10 of this group say higher food and drink prices are a major concern, second only to energy bills, so it’s clear how much food inflation is hitting people’s wallets and increasing their inner worries.”
Private label sales have risen again by 10.3% in the last four weeks as shoppers adopt different strategies to manage their budgets. The market for branded products grew much more slowly, by 0.4%. McKevitt expands: “Food and beverage spending is generally not discretionary, so it’s not easy for shoppers to reduce the amount they buy. Many are looking to cut costs in other ways, and the big shift to private label is still accelerating. While some of the increase is due to price inflation, we can clearly see the trend in sales of the cheaper value private label ranges, which are up 42%. These items currently make up just under 3% of the market, although retailers have been adding new products in recent months, so it will be interesting to see if this continues.”
Some consumers found a slight relief on Halloween this year, although sales were down compared to 2021. McKevitt explains: “Our data covers the four weeks to October 30, so it captures all purchases made by shoppers for Halloween, except the finals. The data shows that just over one in 10 households bought a pumpkin in October, but sales fell short of the levels we saw last year. There is clear evidence that new regulations for products high in fat, sugar and salt are changing the way these items are sold. The proportion of confectionery products purchased on promotion during the month of October was 26%, compared to 36% last year”.
Fewer people are stocking closets for Christmas in October, preferring to wait until later in the year. McKevitt comments: “At this time last year, two million consumers had already purchased their festive Christmas pudding. We’ve seen 32% fewer shoppers doing that this time around, which suggests people aren’t trying to spread the cost of their purchases, at least not in October. This Christmas is going to be a little different, of course, with the men’s soccer World Cup kicking off on November 20. The news of two home nations playing for the first time in almost 25 years should generate plenty of excitement and could boost sales at the tills depending on when the games drop. Beer in particular works well when the football is on. During the 2018 Men’s World Cup, the number of shoppers buying beer to enjoy at home tripled on the day of England’s first game against Tunisia. The afternoon games for the 2022 tournament will likely generate the biggest sales, including England’s match against the USA on November 25.”
Aldi was the fastest growing retailer in the last period, increasing its sales by 22.7% year over year to now have a 9.2% market share. Lidl boosted sales by 21.5% to take its market share to a new record of 7.2%.
Adds McKevitt: “With economic forecasters warning of a possible recession, it is worth reflecting on how much the grocery landscape has changed since the financial crisis of 2008. We have seen an increase in market share for discount stores. Aldi and Lidl, which together now stand at 16.4%, compared to 4.4% 14 years ago.
Asda again led the traditional ‘Big Four’ with sales growth of 5.3%, maintaining a global market share of 14.3%. Meanwhile, Sainsbury’s sales rose 3.3% and its market share is now 14.9%. The largest retailer, Tesco, had a 27.0% share and saw sales grow by 3.1%. Morrisons’ market share is now 9.0%.
Iceland grew slightly ahead of the market, with sales increasing by 5.3%. Co-op sales rose 3.3%, while Waitrose sales fell 1.9%. Online retailer Ocado kept sales flat compared to last year and has a 1.6% market share.