Grocery price inflation has dropped to 4.5 per cent, its lowest level since February 2022, but 23 per cent of British households still identify themselves as struggling financially, shows industry data released today (26).
According to figures by Kantar, take-home grocery sales rose by 4.6 per cent over the four weeks to 17 March, with an early Easter boosting sales of seasonal treats in the first three months of 2024 by £88 million compared with the same period last year.
Sales of branded goods pushed ahead of own label this month. However, premium own-label lines saw growth of 16.1 per cent – the quickest rate in nearly three years
Fraser McKevitt, head of retail and consumer insight at Kantar, explains, “With Easter on the horizon, consumers have been stocking up on classic seasonal treats, with a quarter of people picking up four or more items when buying chocolate eggs. This rises to 29 per cent for shoppers aged over 65, suggesting that many grandparents are planning to indulge their families this weekend. People in Wales and the north of England are among the biggest spenders, shelling out £14.18 and £13.84 on Easter eggs on average respectively in the past three months. Volume sales of hot cross buns are also up by 15 per cent versus last year.”
Spring brought good news for consumers as grocery price inflation eased to 4.5 per cent over the four weeks to 17 March, the lowest level since February 2022.
McKevitt explains, “Grocery inflation has come down significantly since hitting an eye-watering peak of 17 per cent in March 2023. However, despite this continued slowdown, many British households are still feeling the squeeze. 23 per cent identified themselves as struggling financially in our data* – the same proportion as reported in November last year.”
Shoppers remain on the hunt for value and among those feeling most pressured, 78 per cent are actively buying cheaper groceries while 68 per cent are using promotions to help manage budgets. Retailers appear to be responding in kind, with the emphasis on discounts and price match schemes continuing this period. £605 million more was spent on deals this month than in March last year, while nearly one third of baskets across Tesco, Sainsbury’s and Asda collectively contained at least one price matched product.
McKevitt expands, “Premium own-label lines have been a big beneficiary of consumers trading down, growing by a whopping 16.1 per cent this month – the quickest rate we’ve seen in nearly three years. However, sales of branded goods pushed just ahead of own label overall, increasing sales by 6.1 per cent and 4.7 per cent respectively in the latest four weeks.”
Ocado was the fastest growing retailer this month, benefiting from a sustained voucher campaign which helped it attract customers. The retailer improved sales by 9.5 per cent in the latest 12 weeks, ahead of the total online market which rose by 6.6 per cent, to account for 1.9 per cent of all take-home sales. It was the only grocer other than Waitrose to boost its number of shoppers in the latest three months.
Year-on-year sales at Britain’s two largest grocers, Tesco and Sainsbury’s, climbed by 5.8 per cent and 6.7 per cent respectively. Their shares of the market nudged up by 0.4 percentage points each to 27.3 per cent and 15.2 per cent.
Morrisons saw a 3.6 per cent increase in sales over the latest 12 weeks, marking more than one year of consistent growth for the retailer. Its share of spend stands at 8.7 per cent. Asda, meanwhile, increased sales by 0.2 per cent and now holds 13.8 per cent of the market.
Aldi’s sales stepped up by 3.1 per cent, with its market share at 9.8 per cent. Fellow discounter Lidl grew by 8.8 per cent to capture a 7.8 per cent share of the market.
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