After last week’s gloomy news from the high street and a Budget that gave little cause for optimism to voters in our current weekly poll, today brought a raft of further statistical evidence proving what we already knew.
Amid the latest market share figures from Kantar Worldpanel, the headline finding was that the grocery market is growing slower than the rate of inflation for the first time since the summer of 2009.
With inflation at 4% across the sector, sales were up just 2.6% for the period – way down on the 3.9% growth Kantar recorded last time out.
And once again it’s promotions driving sales. Nielsen says 40% of all grocery sales are now from items on promotion – a new record, well up on the 37% reported by thegrocer.co.uk last autumn.
“We envisage shoppers will continue to indulge in Mothers’ Day and Easter promotions but will cut back in the following few weeks in order to balance their household budgets,” says Nielsen’s Mike Watkins.
“Despite the increased spend on promotions, growths almost halved in the past four weeks to 2% compared to February, and volume growths are flat.”
He points to manufacturers passing on commodity prices and the distribution costs generated by sky-high petrol prices, with shoppers’ spending squeezed by the VAT hike and pay freezes. It never rains, but it pours.
Still, amid the economic murk there was more good news for the resurgent discounters, which continue to pick up share.
The 2.5% share taken by Lidl, though obviously modest compared with the supermarket giants, marks its best-ever performance in the Kantar rankings.
“The top four supermarkets are now all seeing similar rates of growth but it is the discounters, such as Aldi and Lidl who are seeing the greatest momentum, with sales growth up 16%,” adds Watkins.
Nice weather for ducks, as they say.
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