Disgruntled Safeway shoppers have poured a whopping £138m into Tesco’s coffers in the year to July 18, according to TNS switching data published exclusively by The Grocer.
The news came as Tesco this week saw its market share hit an all-time high (see page 19).
Tesco has crushed the competition over the last 12 months, stealing £628m of business from rivals and picking up the lion’s share of lost trade from Safeway.
As customers have abandoned Safeway, M& S and Sainsbury in recent months, Tesco has gained in every case, winning £138m from Safeway, £113m from Sainsbury and £66m from M& S over the year. But it is the amount that it has won from Safeway that is most impressive. Retail sources say Tesco has been targeting Safeway with an aggressive marketing campaign.
And new research by CACI for The Grocer shows another reason why Tesco may be winning: the demographic profile of Safeway shoppers is very close to its own.
The only chains that managed to steal any business from Tesco were Farmfoods and Netto, the latter picking up £11m of trade.
Sainsbury, which was widely expected to woo upmarket shoppers disillusioned with M&S and those unhappy with the new look Safeway stores, has
gained just £54m from Safeway and £11m from M&S.
Asda, which has a similar market share to Sainsbury, picked up twice as much business from Safeway and three times as much from M&S over the same period. While Asda and Tesco each stole a massive £113m of trade from Sainsbury, Asda’s achievement is more impressive as it has considerably fewer stores than Tesco and a far smaller market share, and therefore punched well above its weight.
However, it is still vulnerable to competition from Morrisons, which stole £52m of Asda’s business, and from Tesco, which has piled on the pressure in recent months and took £24m of trade from Asda during the year.
Baird analyst Paul Smiddy said: “Asda’s market share growth has slowed a little in the last few weeks. Although Safeway is holding Morrisons back, the gains it has made from Asda show that long term, Morrisons remains a big threat to Asda as it has the closest customer base and pricing policy.”
>>p19 TradeTrak, p30 Analysis
Elaine Watson