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UK Grocery Market Growth Slows as Consumers Show Caution

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UK Grocery Market Growth Slows as Consumers Show Caution

UK Grocery Market Growth Slows as Consumers Show Caution
March 04
14:18 2011

The latest grocery share figures from Kantar Worldpanel, for the 12 weeks ending 20th February 2011, show that the market is subdued as shoppers watch their pennies. Overall market growth slowed slightly this period to 3.9% compared to 4.2% last month. However, both Sainsbury at 5.2% and Morrisons at 4.5% outperformed, growing ahead of the market.

Sainsbury’s market share moved up to 16.5%, compared to 16.3% a year ago, which continues its strong run, gaining share every month since March 2009. Morrisons maintains its 12.3% market share from the same period last year. Tesco and Asda performed slightly behind the market, with share now standing at 30.3% and 16.9% respectively.

Fraser McKevitt, retail analyst at Kantar Worldpanel, comments: “Waitrose followed the market trend of slightly slower growth this period, but still posted increased sales of 6.6% compared to a year ago, taking its market share to 4.4%, the highest ever recorded by the retailer.”

2011 has seen a return to strong growth from the discounters, both Aldi and Lidl delivering double digit growth, well-ahead of their performances in 2010. Aldi now holds 3.1% of the market, up from 2.8% last year, and Lidl holds 2.4%, up from 2.2%.

Fraser McKevitt explains: “With economic uncertainty increasingly in the news it is no surprise that shoppers are being cautious with their spending. However, while the discounters are performing well this is not due to an increase in new shoppers, but rather because their existing customers are spending more with them. The majority of people continued to seek value through promotions in the mainstream retailers, rather than trading down to the discounters.”

The Co-operative’s market share stabilised at 6.7% this month, however this is a drop from 7.4% a year ago. Iceland’s market share remained at 2.0%, but it will find substantial market growth challenging in the next few months because of strong comparative numbers in 2010.

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