GB market growth: online reaches record market share

Date : 08 December 2020

Lucy Ingram

Retail Analyst

A combination of shoppers planning earlier for Christmas, and a national lockdown in England, led to the grocery market's fastest rate of growth since August. The market grew 11.3% in the 12 weeks to 29 November, according to Kantar. We look at key retailers' sales growth, the latest online developments, and highlight format development from the Big Four in November. 

Preparing for Christmas and lockdown restrictions drives growth

According to our ShopperVista research, conducted in mid-November, 34% of shoppers have already started buying, or pre-ordered groceries for Christmas. 36% of shoppers will be carrying out their Christmas shopping earlier than normal in 2020 to avoid long queues. Retailers have responded to shoppers' concerns over ease of shop in various ways; see our three eye-catching initiatives that focus on offering convenience, value, and support to local communities during the season.

Pre-lockdown was a particularly busy time, with sales +17% in the three days before non-essential retail and hospitality closed on 5 November. The increased demand continued throughout the month, with November seeing the highest shopper frequency since the beginning of the pandemic. This led to November being the single largest month ever for the supermarkets, with £10.9 bn spent over the four weeks. 

Online reaches record market share

The online channel continued its strong performance, reaching a record share of the market, at 13.7%. This was driven by more than six million households buying groceries online, the highest month on record. Ocado remained the fastest growing retailer for the seventh month in a row, with sales at +38.3%.

Retailers continue to innovate to keep up with the demand in this channel. During this reporting period we saw Co-op launch multiple initiatives to accelerate its omnichannel initiatives;

We also saw Deliveroo continue to expand its reach, growing its trial with Aldi to almost 130 stores and Waitrose to 40 stores.

What comes next is less certain, as Christmas is a challenging time for omnichannel retailers picking from stores. In the last few days, operations are at capacity, and store colleagues are picking large orders, which contain multiple essential items. For many shoppers, a Christmas dinner without brussel sprouts, or the right turkey, is a disaster. If you are looking for more insight into trading online over Christmas, read our will online retailers deliver this Christmas? article, or watch our video on how can suppliers win online this Christmas?

Lidl outperforms the market, whilst Aldi is slowest growing retailer

Lidl continues to outperform the market, with sales +13.9%. It also grew market share to 6.2%. Fellow discounter Aldi was unusually the slowest growing retailer, with sales at +7.0%. It also lost market share, slipping to 7.7%, compared to 7.8% in November.

For subscribers looking for more insight on Lidl, see our updated strategic outlook for Lidl.

Morrisons saw the fastest growth of the Big Four

Morrisons is the only retailer of the Big Four to grow above the market, with sales +13.7%. Sainsbury's and Tesco saw a similar performance to each other, with sales +10.8% and +10.4% respectively.

Asda's growth was slower, at +7.7%. The retailer announced its Q3 results in November. Like-for-like sales in the three months to 30 September grew by +2.7%. This was a slowdown on Q2’s +3.8%, with the period coinciding with the end of the first UK-wide lockdown and the reopening of the hospitality sector.

This 12 week reporting period saw interesting format development from both Sainsbury's and Morrisons, as they put a greater focus on fresh;

Other standout performances: Iceland and Waitrose

November saw another standout performance from Iceland, as it retained its spot as the fastest growing bricks and mortar retailer, with sales +21.0%. Waitrose saw sales increase +13.2%, its fastest grwoth rate since 2005. It also increased market share 0.1 percentage points to 4.9%.

Detailed results

Retailer 12 weeks to 1st December 2019 12 weeks to 29th November 2020 Sales growth (Y-O-Y%)
Tesco 27.3% 27.0% 10.4%
Sainsbury's 15.7% 15.7% 10.8%
Asda 14.6% 14.1% 7.7%
Morrisons 10.1% 10.3% 13.7%
Aldi 8.0% 7.7% 7.0%
Co-op 6.3% 6.3% 9.8%
Lidl 6.1% 6.2% 13.9%
Waitrose 4.8% 4.9% 13.2%
Iceland 2.2% 2.4% 21.0%
Ocado 1.4% 1.7% 38.3%
Other Multiples 1.7% 1.8% 19.1%
Symbols & Independents 1.7% 1.8% 17.6%

Source: Kantar

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