Supermarkets sales see ‘marked turnaround’, with online also up 11%

UK supermarket sales have seen a “marked turnaround”, up 5% in the last 12 weeks, the fastest rate in five years, while online sales also grew ahead of the market at 11%, the latest data from Kantar has shown.

Consumers

Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel said the grocery results were “a stark contrast” to the 0.2% decline seen during the same period last year, especially considering the political and economic uncertainty of recent weeks and continuing Brexit uncertainty, which had not dampened customers’s habits at the tills.

As well as strong comparable to a weak June 2016, the “robust performance” could be primarily attributed to continuing inflation, McKevitt says, which now stands at 3.2%.

“At this rate, that’s an extra £133 on the average household’s annual shopping bill, or the equivalent of seven additional shopping trips a year,” he added.

Regarding online, the UK retail scene was still trying to make sense of what Amazon’s acquisition of organic retailer WholeFoods could mean for the UK market, but McKevitt pointed out that although Ocado’s growth was similar to the online growth at 10.7%, it had taken over a decade to get to its current market position of 1.3%.

Ocado’s growth was second only to that of Aldi and Lidl at 18.7% and 18.8% respectively.

All of the big four were in growth, with Tesco (+3.5%) seeing growth in its larger stores, Sainsbury’s local helping to boost its sales by 3.1% and own label growth particularly strong at Morrisons (up 3.7%). Only Asda saw growth of its branded lines ahead of own label, with overall sales up 2.2%.

Waitrose and the Co-op also continued their upward growth, rising 5.5% and 2.2% respectively – but there was little positive impact on market share across the board, as the discounters stole that share, boosting their share collectively by 1.4 percentage points. Only Iceland saw a rise in market share, up 0.1 percentage point to 1.1%. with Waitrose and Ocado holding steady.

Meanwhile Waitrose last week reported a boost to its rosé wine sales, which rose by 108% in the week to 20 June due to the heat wave and the timing of promotion which cut the price of three bottles by 25%.

Supermarkets are also looking to roll out dynamic pricing within five years, according to a report in The Telegraph on the back of advance tech ‘e-prices’ that can be altered by the retailer automatically to change prices at peak time pricing.