Growth for discounters, convenience stores and online shopping will boost the value of the UK food and grocery market by nearly 20% over the next five years to £184bn.
According to new research from the IGD, discounters will grow 10% a year and be worth £11.4bn by 2016, up from £7bn in 2011. The convenience sector will grow by 4.7% and is set to be worth £42.2bn by 2016, up from the current level of £33.6bn.
But the most rapid growth will come online, where the market will double over the next five years to £11.2bn – representing growth of almost 14% annually. Online sales for the current year are estimated to be £5.9bn.
“Despite the extraordinary economic climate and the ongoing uncertainty caused by the Eurozone crisis, there are a number of exceptional events in 2012 that could provide opportunities for growth,” said IGD chief executive Joanne Denney-Finch, highlighting the Queen’s Jubilee celebrations, the Euro2012 football championships and the London Olympics.
“Our ShopperTrack data shows a doubling in shoppers using food discounters for their main source of grocery shopping,” she added. “Six percent of them say they now use this outlet as their main grocery channel, compared to 3% last September.”
Denney-Finch said technology would be key to driving growth, citing the example of ‘push messages’ to mobile phones as part of an increase in proximity marketing.