Grocery price inflation has fallen below 10% for the first time since July 2022 and now sits at 9.7% for the four weeks to 29 October 2023, according to the latest data from Kantar. Take-home grocery sales over the same period rose by 7.4% compared with last year.
Fraser McKevitt, head of retail and consumer insight at Kantar, said: “Grocery price inflation has finally dropped into single digits after 16 months of double digit growth, marking a big milestone for the British public and retailers. While the drop to 9.7% is positive news and something of a watershed, consumers will still be feeling the pinch.”
Fraser McKevitt continues: “Retailers continue to look at ways of softening the blow for shoppers and slowing the rate of price rises. This has included upping the ante on promotions – every single one of the grocers increased the proportion of sales through deals versus last year which is something that has only happened on one other occasion in nearly ten years. Consumer spending on promotions has now hit 27.2% of total grocery sales – the highest level we’ve seen since Christmas last year. This is a big gear shift from October 2022 when this figure was less than a quarter.”
The fight for shoppers’ Christmas spend looks set to be fierce between the retailers this year. Fraser McKevitt explains: “When it comes to where people shop, Brits definitely aren’t loyal and some of the traditional shopping demographics and stereotypes have been thrown out of the window. The typical customer walking through the doors of the discounters is now representative of the country as a whole, with 54% of Aldi and Lidl’s sales coming from the more affluent ‘ABC1’ social group – close to the national average of 55%. Discounters are making their mark in frozen items and fresh groceries like meat and veg, with these categories constituting a higher proportion of their sales than the traditional retailers.”
Lidl was again the fastest growing retailer this month with sales over the 12 weeks up by 14.7% and share up by 0.4 percentage points to 7.6%. Fellow discounter Aldi sat beside Waitrose as one of only two grocers to increase its number of shoppers year on year, attracting 207,000 more customers than last year. Aldi and Waitrose grew sales by 13.2% and 5.4% respectively to take 9.7% and 4.6% of the market.
Sainsbury’s was the fastest growing traditional supermarket this month, with sales up 10.1% over the 12 weeks to 29 October compared to last year. Growing ahead of the market, the retailer now holds 15.2% share, up from 14.9% last year. Britain’s largest grocery chain Tesco gained share for the fourth consecutive month to take 27.4% of the market, an increase of 0.4 percentage points versus a year ago, as year on year sales growth reached 9.5%.
Morrisons has now been back in growth for seven months, with sales in the latest period up by 3.2%. It now holds 8.6% of the market and Asda stands at 13.6%. Co-op’s sales have grown by 5.2%, the fastest rate since March 2021. Its market share stands at 6.0%, though in baskets that are less than £20 this figure jumps considerably to 16.9%.
Iceland now accounts for 2.1% of the market, as sales increased by 2.6% over the 12 weeks. Online-only grocer Ocado’s market share has risen to 1.7%, while its year-on-year sales have grown by 12.6%.
