London, 29 August 2014 – After a seven-year low point this summer, year-on-year sales growths at the UK’s leading supermarkets finally showed evidence of a potential turnaround – according to the latest data from global information and insights company Nielsen.
During the four weeks ending 16 August 2014, the decline in value sales was arrested, with consumer spend at the UK’s leading supermarkets unchanged on the same period a year ago (0%¹ change), although volume sales were down -0.9%¹.
“The cigars won’t be out yet, but it’s a respite from the negative figures that have blighted this year,” says Nielsen’s UK head of retailer and business insight Mike Watkins. “Whilst July’s warm weather and a continuation of promotional activity helped kick-start sales, the growth challenges for the big four supermarkets remains – weak demand through a ‘shopping only when needed’ mentality among consumers and increased activity at the discounters.”
Sales of soft drinks (+3.0%) outperformed the overall market with still water doing particularly well (+20%). Sales growth of Beers/Wines/Spirits was +2.9% – sparkling wine sales increasing +35% year-on-year. Delicatessen also increased +2.9% to provide good growth in food and drink. Seasonal discounting and ‘back to school’ promotions gave a lift to General Merchandise (+1.8%) which also outperformed the market.
Asda was the only one of the Big Four to see an increase (+0.2%) in market share, while Sainsbury’s maintained year-on-year market share for the second consecutive 12-week period. Tesco and Morrisons’ market share both fell.
However, Watkins comments: “After a difficult year, there’s an indication in the last few weeks that Morrisons’ sales performance is starting to improve, with new shoppers attracted by some strong promotional offers. It’s early days but if the current momentum continues, Morrisons’ sales growth should return to positive territory before Christmas.”
During the four weeks ending 16 August 2014, Sainsbury’s saw the biggest increase (45% to £4.1 million²) in TV and press advertising spend compared to the same period the year before. Asda increased spend by 42%, making it the highest spender during the period (£4.7 million), while Morrisons increased spend by 40% to £3.9 million.
Overall, the leading supermarkets spent £22.4 million in the period, 1.6% less than a year ago.
“More advertising around price cuts is likely after the summer holidays, as the major supermarkets start to activate their autumn and winter campaigns,” concludes Watkins.
“Whilst the levels of in-store promotional spend have dipped a little, to 34% of sales, it’s expected to increase again later in the year, as retailers seek to drive pre-Christmas sales. Looking ahead, we anticipate sales growths will stay broadly positive for the rest of the year but that the battle for market share will certainly intensify between the Big Four.”
All figures are from Nielsen Homescan Total Till unless otherwise stated
¹Source: Nielsen Scantrack Grocery Multiples
²Source: Nielsen Ad Dynamix
The Nielsen continuous 14,500 GB household panel is geo-demographically balanced and designed to measure household purchasing through a wide range of channels. It includes all food and drink and non-food spend (e.g. household, personal care, clothing, electrical, cards and stationery, toys, music, general merchandise, etc.) It represents the total amount paid (after all coupons and vouchers), found on the till receipt.
The Nielsen scanning service that measures total store sales every week by SKU for 15,000 shops across all food and drink trade channels in GB. This uses the actual EPOS data from retailers, thus, Scantrack is the most robust and reliable measure of FMCG sales and is integrated with Homescan for the key indicators of retailer and category performance. The total market measured is £140bn per annum. ‘Grocery Multiples’ is a defined sub-set of the major supermarkets that also includes all food sales from Marks and Spencer (but excludes Aldi and Lidl). The Grocery Multiples account for over £117bn of all GB food, drink and supermarket general merchandise sales.
Nielsen Holdings N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence and mobile measurement. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA and Diemen, the Netherlands.