Improved trading at Big Four lifts GB market growth

Lucy Ingram
Retail Analyst
@RetailAnalysis

Date : 03 March 2020

Market growth for the 12 weeks to 23rd February was +0.7% according to Kantar, up from +0.3% last month. Despite being modest, this was the fastest growth since November 2019. Sales were driven by better performance across the multiples. We look at this and the latest news from the leading retailers in more detail.

Sainsbury's strongest performer of the Big Four

Sainsbury’s was the best performer of the Big Four, with sales +0.3%. It saw positive performance in its Local convenience stores and online. This was the first time Sainsbury's has been in growth since October 2019. The retailer appears to be be more sure footed in its strategy, focusing on innovation and maintaining shopper loyalty. In February it opened its first 'On the go' convenience store format in Mansion House, London. The store showcases the retailers latest thinking for its convenience stores, with direct appeal to shoppers on the move it has multiple areas dedicated to food-to-go.

Sainsbury's also launched Nectar Prices in February. This offers discounted prices for Nectar card holders for the first time across a selection of products in-store and online. The move should help Sainsbury's reach out to price sensitive shoppers and also boost engagement with its recently relaunched loyalty scheme.  

Asda and Morrisons see biggest improvement

Although the negative trend continued at the rest of the Big Four, all performed better than in the previous reporting period. With sales at Asda and Morrisons seeing the biggest improvement.

Asda’s sales fell -1.2%, compared to -2.2% in January. The retailer recently released its Q4 results, revealing declining overall sales, but 'more stable' grocery sales. Walmart has revealed it is in early stage discussions to sell a controlling stake in Asda. This has generated discussions with third parties, following the prohibition of Asda's proposed merger with Sainsbury's. As a result of this Asda has upped the pace of change to develop growth opportunities and help it stay on the front foot in the challenging retail environment.

It has recently announced an exclusive partnership with YO! Group, the owner of YO! Sushi, to trial a new pan-Asian street food concept in 20 of its larger stores. It is also testing numerous technologies at its Stevenage store to improve the customer experience and make the store more efficient to operate. This includes 3D hologram projectors, automated click & collect and availability cameras. Subscribers can read more about this in our Asda Stevenage: 'Test & Learn' Technology store report. Also look out for our upcoming visit to Asda Edinburgh Supercentre where we take a detailed look at its newly refurbished store, that has a greater foodservice focus.

Morrisons sales were -2.0%, compared to -3.0%. Look out for our coverage of its annual results when they are released on March 18th. 

Lidl becomes the fastest growing retailer

Lidl overtook Ocado and became the fastest growing supermarket, with sales up 11.4%. This is the first time since 2017 that Lidl has been the fastest growing retailer. The shift reflects the discounter's continuous expansion. In February it opened its 800th store in the UK and during this period it saw an increase of over 900,000 shoppers.

Aldi's performance remained the same as in January, at +5.7%. The slowdown in growth suggests the retailer's new store opening rate has also slowed.

Both discounters announced new sustainability initiatives in February, with Lidl launching its 'ocean-bound' plastic packaging and Aldi reinforcing its plastic reduction pledge by issuing suppliers with a warning that they could be delisted if they do not meet its plastic packaging reduction targets.

Learn more about the leading retailers' performance and strategies at our events;

Detailed results

Retailer 12 weeks to 24th February 2019 12 weeks to 23rd February 2020 Sales growth (Y-O-Y%)
Tesco 27.7% 27.2% -0.8%
Sainsbury's 15.7% 15.6% 0.3%
Asda 15.4% 15.1% -1.2%
Morrisons 10.4% 10.2% -2.0%
Aldi 7.6% 7.9% 5.7%
Co-op 5.9% 6.0% 2.5%
Lidl 5.2% 5.8% 11.4%
Waitrose 5.2% 5.1% -1.3%
Iceland 2.2% 2.2% 1.7%
Ocado 1.3% 1.5% 10.8%
Other Multiples 1.8% 1.7% -0.7%
Symbols & Independents 1.6% 1.6% 2.6%

Source: Kantar

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