Britain's grocery market grew more slowly over the Christmas period as inflation softened and more people shopped at discounters, according to new data from Kantar Worldpanel.
Lower inflation impacts growth
In the 12 weeks to December 30th, market growth was 1.6%, down from 2.0% in the 12 weeks to October 7th and from 3.8% for the same period a year ago, pulled down by lower inflation. Inflation for the period was +1.3%, less than half the 3.6% rate of Christmas 2017 following investments in price by retailers to meet consumers' heightened focus on value. Despite this shoppers spent a record £29.3bn on groceries, £450m than a year ago.
Premium ranges drive growth for discounters
Once again Aldi and Lidl set the pace for the sector, with two thirds of households shopping at one or both of the discounters over the 12 week period. Aldi's growth of 10.4% is in line with the 10% growth it reported yesterday with strong sales of vegetables following the popular Kevin the Carrot marketing. At Lidl, nearly one third of December's growth came from sales of branded lines and sales of the Deluxe range jumped by one third. Together the two discounters secured a 12.8% Christmas market share, their highest ever.
Asda and Tesco strongest of Big Four
Asda narrowly beat Tesco to be the fastest growing retailer of The Big Four. Its Extra Special range was the fastest growing premium range of any major retailer. Asda also performed strongly online with growth of 12%. Tesco meanwhile achieved growth of 0.6%, lifted by an extra 125,000 shoppers visiting its stores, particularly its larger formats. Interestingly, Kantar reports that Tesco was the only retailer to have increased its promotional activity year-on year, with its 29p festive veg packs securing its position as a destination for main Christmas meal shoppers. Tesco will report its Christmas results on Thursday Jan 10th.
Flat results for Morrisons and a decline for Tesco
Morrisons sales were essentially flat for the period though this result excludes sales through the retailer's fast growing wholesale operations. See Morrisons own results for the factors shaping its trading performance. At Sainsbury's, sales declined by 0.4% according to Kantar. The retailer will release its own results tomorrow.
Encouraging growth for Co-op
Co-op has continued its strong run of recent results, achieving 3.2% growth over Christmas. Its market share increased for the seventh consecutive period and is likely to advance further in 2019 as it pushes ahead with 100 new store openings.
12 weeks to 31 Dec 2017 (% share)
12 weeks to 30 Dec 2018 (% share)
Sales growth (Y-o-Y %)
|Waitrose & Partners
|Total symbols & independents
Source: Kantar Worldpanel
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