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No Let-up in Polarisation of UK Grocery Market

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No Let-up in Polarisation of UK Grocery Market

No Let-up in Polarisation of UK Grocery Market
June 24
11:15 2013

The latest grocery share figures from Kantar Worldpanel UK for the 12 weeks ending 9 June 2013 show continuing market polarisation with Aldi, Lidl and Waitrose all stealing share from the big four retailers.

Aldi sets another all-time record share of 3.6% – an increasingly frequent occurrence for the retailer which has averaged 30% annual sales growth throughout 2013. Meanwhile, Lidl and Waitrose both hold on to their record shares of 3.0% and 4.9% respectively, with Waitrose recording growth of 10.4% – well over three times the market average.

These performances have enabled Aldi, Lidl and Waitrose to exert continued pressure on the big four with share dips for Tesco, Asda and Morrisons. Only Sainsbury’s bucks the trend, increasing its share to 16.7% and posting market-beating sales growth of 3.5%.

Although Morrisons’ share continues to decline, the loss this period is the lowest for 2013 and indicates a small underlying improvement for the grocer.

Fraser McKevitt, retail analyst at Kantar Worldpanel, comments: “The continuing polarisation of the grocery market poses a difficult question for the big four retailers – how to make their offer appealing in an increasingly squeezed market. Asda recently announced it is going toe-to-toe with Aldi on the price of fresh food and produce, demonstrating its growing concern with the threat from the discounter.”

He continues: “Savvy shoppers are looking for a good deal, but Britain’s largest supermarkets should not lose sight of the other attributes consumers are looking for in their grocer – quality products, clear provenance and an enjoyable in-store experience. The big four will have to keep an eye on maintaining these standards, even when competing on price, to make sure that they offer genuine value for money and not just cheap goods.”

Market growth is currently at 3.0%, down from 3.9% in the previous period. The dip between this year and the same period in 2012 can be largely attributed to the Diamond Jubilee.

Grocery inflation remains at 3.9% for the 12 week period ending 09 June 2013. This exceeds the market growth of 3.0% which suffers from comparison with the 2012 impact of the Diamond Jubilee.

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