GB grocery market growth accelerates

Lucy Ingram
Retail Analyst
@RetailAnalysis

Date : 27 May 2020

The 12-week period to 17th May saw grocery sales rise 14.3%, the fastest rate since comparable records began in 1994, according to the latest figures from Kantar. We look at the results in more detail and performance from key retailers.

Shoppers conducted fewer, larger shops

The 12 weeks to 17th May included the pre-lockdown rush to the shops in March and eight weeks of stay-at-home advice. All of the ten major retailers saw an increase in sales during the period. The trend towards fewer, larger shops that we saw in April broadly continued. Shoppers visited the supermarket 3.5 times per week on average, meaning 100 million fewer trips overall than the same month last year. Spend each trip increased to £27.41, this is close to 50% more than during normal times. This was driven by shoppers continuing to cater for more people living under one roof and not eating out.

Amongst the Big Four, Tesco was the best performer with sales growth of 12.7%, Sainsbury’s by 12.5%, Asda by 6.5% and Morrisons by 9.8%.

For subscribers looking for more insight on UK retailers like-for-like performance, download our UK results tracker.

Online rapid growth continues

Ocado overtook Co-op to become the fastest growing retailer during the period, with sales growth of 32.5%. Ocado’s market share has risen to 1.6%, compared to 1.3% last year. Ocado recently announced its trading update for Q2, retail revenue was up 40.4% year-on-year (YoY), compared to 10.3% YoY growth in Q1. Following significantly increased demand at the start of the outbreak, Ocado announced the number of items per basket appears to have passed its peak, whilst remaining high. The share of fresh and chilled products, relative to ambient, is also returning to normal as the retailer sees more normal shopping behaviours return. Ocado said its mature CFCs are running at their peak and best efficiencies. For example, its Erith CFC is currently processing 110,000 standard sized orders per week, compared to 80,000 at the end of its first quarter.

Online shopping sales were 75% higher than this time last year, accounting for 11.5% of all grocery sales. Nearly one in five households ordered groceries online in the most recent four weeks, 1.6m more than this time last year.

For subscribers looking for more insight, read our report on how the online channel will be impacted by the coronavirus (COVID-19) in 2020.

Co-op sees strong growth

Co-op once again benefitted from shoppers buying locally, with strong sales growth of 30.8%, compared to 3.7% last year. The convenience retailer reached 7% market share, a high it has not seen since 2011. This time last year its market share was 6.1%.

During this period Co-op has rapidly accelerated its online expansion to more than double the number of stores planned as it adapts to changing shopper demands caused by the coronavirus crisis. Between the Deliveroo partnership and its own shop.coop.co.uk service, the retailer is now offering online groceries in 1,000 catchment areas. It has also launched a new home delivery partnership with Irish start-up; Buymie, to offer same-day grocery deliveries to over 200,000 households across Bristol. The move is the first partnership in the UK for Buymie whose mobile app allows customers to book personalised online home grocery deliveries.

For subscribers looking for more insight, read our report on how the coronavirus (COVID-19) is having an impact on global convenience trends.

Discounters see sales growth but market share drops 

Aldi's market share dropped to 7% in the 12 weeks to 17th May 2020, compared to 7.9% in the previous reporting period, and 8% last year. It did however see sales growth of 10.4%, an increase compared to the previous reporting period, where sales grew 8.8%.

Lidl performed better with market share only dropping to 5.9%, compared to 6.0% in the previous reporting period. It also retained a slight increase on last year's 5.8%. Sales growth at Lidl was ahead of Aldi at 16.5%, compared to 14.8% in the previous reporting period.

See our round-up of the latest initiatives seen in the discount and variety discount channel to address the challenges created by the coronavirus (COVID-19) outbreak.

Detailed results

Retailer 12 weeks to 19th May 2019 12 weeks to 17th May 2020 Sales growth (Y-O-Y%)
Tesco 27.3% 26.9% 12.7%
Sainsbury's 15.2% 15.0% 12.5%
Asda 15.2% 14.1% 6.5%
Morrisons 10.4% 10.0% 9.8%
Aldi 8.0% 7.7% 10.4%
Co-op 6.1% 7.0% 30.8%
Lidl 5.8% 5.9% 16.5%
Waitrose 5.1% 5.0% 12.5%
Iceland 2.1% 2.4% 28.6%
Ocado 1.3% 1.6% 32.5%
Other Multiples 1.9% 2.0% 25.3%
Symbols & Independents 1.7% 2.5% 63.1%

Source: Kantar

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