Grocery sales climb but shoppers focus on deals

Grocers’ take-home sales advanced 3.2% year on year in the four weeks to November 2, the latest date from Worldpanel by Numerator (formerly Kantar) revealed.

Spending on deals was up 9.4% in the period, while spending on full priced goods was only ahead 1.8%. Almost 30% of grocery spending was on promoted items as inflation moderated to 4.7%.

Despite shoppers’ value-for-money behaviour, they are still expected to splash out as Christmas approaches and sales of retailers’ premium own lines are forecast to reach £1bn for the first time in December.

Online was the fastest growing sector of the grocery market, and spending on home delivery rose 11% over the month. That helped Ocado reach a record market share of 2.1%. Ocado was the fastest growing grocer for the third consecutive month after achieving sales growth of 15.9% – its highest in over four years since April 2021.

Lidl was the fastest growing grocer with stores. Its sales rose 10.8% to give it a share of 8.2% versus 7.7% a year ago.

Worldpanel head of retail and consumer insight Fraser McKevitt said: “Christmas ads are hitting our screens and the race to the big day is on in the supermarket sector. Retailers are very alive to the financial struggles that some households are facing, not least ahead of this year’s Budget.  

“They’re eager to show how they’re offering shoppers value for money, putting the emphasis on price cuts rather than multibuy offers. It’s not just the Grinch who’s looking for savings with just shy of 30% of consumer spending at the grocers on promoted items in October, a figure that we expect to go even higher as we get closer to Christmas.”  

“It’s important to remember that shoppers often look for great value and quality, not just the cheapest product. At Christmas especially, people want to treat themselves and throughout the cost-of-living crisis we’ve seen them turning to retailers’ premium own label lines to do that in a way that’s more affordable. Sales of these goods were worth £582m in the latest month and they are likely to double as Christmas edges nearer.”