Grocery price inflation has fallen to 5.3 per cent, marking the lowest rate since March 2022 and a decrease of 1.5 percentage points from January, according to data released today (27) by leading marketing data and analytics company Kantar.
Take-home grocery sales grew in value by 5.1 per cent for the four weeks to 18 February 2024.
Tom Steel, strategic insight director at Kantar, explains, “Things are looking up for shoppers this February. Consumers have been navigating a grocery inflation rate of more than 4 per cent for two years now, so this latest easing of price rises is especially welcome.
“Though there’s been lots of discussion about the impact the Red Sea shipping crisis might have on the cost of goods, supermarkets have been pulling out all the stops to keep prices down and help people manage their budgets.
“This month, Morrisons became the latest retailer to launch a price match scheme with Aldi and Lidl, after Asda made the move in January. More generally, we saw promotions accelerate this month after a post-Christmas slowdown. Consumers’ spending on offers increased by 4 per cent in February, worth £586 million more than the same month in 2023. Sainsbury’s and Iceland’s efforts paid off in particular, and they were the only retailers to attract more shoppers through their doors. The battle between supermarkets’ own-label lines and brands also remains fierce. Own-label nipped ahead this month, growing sales by 5.5 per cent versus branded products at 5.3 per cent.”
Britons still found room within their budgets to celebrate on Valentine’s Day. In the seven days before, steak and boxed chocolate sales shot up by 12 per cent and 16 per cent compared with last year. However, shoppers were clearly on the hunt for value.
Steel comments, “£36 million was spent on meal deals costing £10 or more in the week leading up to 14 February. This figure is slightly down on 2023 when spend hit £43 million, but that’s because consumers chose to make more savings this year through price cuts. Sales of chilled ready meals and desserts on promotion did particularly well this year.”
February saw a return to indulgence for some consumers as dry January came to a close. Total alcohol sales jumped up by 18 per cent in volume terms versus the previous month, with consumers buying 28 per cent more wine and 16 per cent more beer and lager. Red wine was particularly popular, with eight million more bottles bought this month than in January.
Lidl was the only retailer to achieve double-digit growth with sales up by 10.9 per cent over the 12 weeks to 18 February 2024, making it the fastest growing grocer for the sixth month running. It now holds a 7.5 per cent share of the market, an increase of 0.4 percentage points. Fellow discounter Aldi also grew ahead of the market, boosting sales by 5.7 per cent and maintaining its 9.4 per cent share.
Sainsbury’s and Tesco increased their share of the market by 0.4 and 0.3 percentage points respectively. Sainsbury’s now holds a 15.6 per cent share, with sales up 7.6 per cent. Tesco’s sales grew by 6.2 per cent, pushing Britain’s largest grocer to a 27.6 per cent share of the market.
Waitrose increased sales by 3.8 per cent, accounting for a 4.6 per cent share. Morrisons’ share now stands at 8.8 per cent, with sales up by 3.1 per cent compared to last year.
Co-op’s sales were up by 1.4 per cent, resulting in a 5.3 per cent share for the retailer. Ocado now holds 1.9 per cent share of the total market as sales rose by 4.9 per cent, behind that of the total online market, which saw year-on-year growth of 6.8 per cent.
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