As we finally move into summer weather, many retailers are waiting in anticipation for seasonal sales uplifts. Even so, topline retail sales growth in the grocery multiples has been relatively good at 4.8% in the three months up to the beginning of June, driven by general merchandise and also health, personal care and many chilled and fresh foods.
Homescan shows Tesco has achieved market-leading sales growth in its out-of-town stores and this month’s TradeTrak confirms it continues to grow overall share at 30.3% in the last 12 weeks. The combined Morrisons group has continued to lose share since the start of the year - sitting at 11.5% in the 12 weeks to June 11 from 14.5% last October.
While Sainsbury has slipped back on recent gains in numbers of shoppers in the last 12 weeks, the amount spent per visit continues to grow and sits at just over £105 per buyer for the four weeks to June 11, resulting in Sainsbury’s overall market share dropping back only slightly, to 15.8%. Asda, despite a slowdown in sales growth, is still 1.2% points ahead of Sainsbury on total till at 17% but behind on grocery-only at 16.1% versus Sainsbury’s 17.2% share here.
Keeping sales buoyant is more of a challenge for supermarket chains reliant on gaining a high proportion of sales from high street shoppers.
Overall retail spend by these shoppers is weaker and they increasingly visit a greater number and range of store formats for food.
The penetration of shoppers visiting Iceland has declined to 14.7% in the most recent four weeks while the penetration at Somerfield has increased to 18.4% as this retailer becomes one of the first to develop a multi-format strategy just for the high street.
The Co-operative Group has also developed such a strategy, with more than 1,700 shops across a range of small store formats making it the market leader in convenience retailing.
The group is the most significant part of the total Co-op four-week shopper penetration of 25%, which is holding up well in the first part of 2005.
So for all retailers, big and small, the challenge is to continue to reinvent the proposition for the customer and to make the reason to visit clear and compelling. In a world of multi-format and multi-channel retailing the opportunity to shop elsewhere has never been greater.