Shoppers leaving it particularly late meant huge sales surge in week before the big day
London, 10 January 2017. Britons left their Christmas grocery shopping particularly late this year which meant supermarket sales in the week up to Christmas were “surprisingly strong” and resulted in the best Christmas trading period for four years.
Nielsen retail performance data released today shows takings at the tills for the four-week period ending 31st December rose +3.3%¹ versus the same period a year ago. This was the highest growth since 2012 (+3.7%) and a big improvement on last Christmas when year-on-year growth was flat (0%).
Shoppers delayed grocery purchasing to such a degree that it caused a huge surge in sales in the week ending Christmas Eve, with sales rising +22% compared to the same week last year, “helping to make it one of the biggest ever ‘end of year’ for supermarkets,” according to Mike Watkins, Nielsen’s UK head of retailer and business insight. Spend in that final two weeks alone was £5.9 billion.
“Shoppers left it particularly late this year, not only because there was an extra day to do the big Christmas shop but the mild weather meant there was no need to visit the shops to stock up in advance, which benefited larger stores in particular,” he said.
Watkins also attributes the strong performance to supermarkets simplifying their promotional strategies. The percentage of purchases that went on sales/promotional products dropped from 31% last Christmas to 27% this year – the lowest for six years. “Stronger communication on price cuts and less complicated promotions helped capture the seasonal and discretionary spend which had been ‘missing in action’ for much of 2016,” said Watkins.
Supermarkets also benefited from more in-store visits than last year, as consumers “shopped around for choice and range as well as the best prices.”
Alongside the rise in sales value, the volume of groceries purchased increased +2.1%¹.
All categories returned to positive sales growth, except for Household and Fresh Meat/ Fish/Poultry where deflation continued to impact sales.
Confectionery (+9.5%), Beers, Wines and Spirits (+5.7%), Deli/Cheese/Meats (+5.6%) and Soft Drinks (+4.3%) saw the strongest growth. General Merchandise (+2.5%) also bounced back after a Black Friday dip.
Aldi had the biggest year-on-year growth among the grocery retailers with sales up 17% in the four-week period and almost one million new shoppers compared to last year. “New ranges and more fresh foods meant shoppers were able to do a full Christmas shop this year at Aldi,” noted Watkins.
Among the Big Four, Morrisons had the largest year-on-year growth (3.4%) in sales, narrowly ahead of Tesco (2.7%). However, across the full 12-week period, Tesco came out ahead and was the only one of the top four supermarkets not to see a drop in market share.
It’s interesting to note that over the 12 weeks, Iceland (4.7%) was the third fastest growing retailer after Aldi and Lidl.
Watkins concludes, “The remarkable buoyancy in shoppers spending freely in the final two weeks of the year to enjoy the festivities was good news for retailers considering the consumer head winds expected in 2017 with the return of cost price inflation – after three years of deflation – plus the ongoing uncertainty about the impact of Brexit on UK grocery sales.”
All figures are from Nielsen Homescan Total Till unless otherwise stated
¹Source: Nielsen Scantrack Grocery Multiples
The Nielsen continuous 15,000 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 measures total store sales every week by SKU for 20,000 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 performance. The total market measured is £145bn 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 £120bn of all GB food, drink and supermarket general merchandise sales.
Nielsen Holdings plc (NYSE: NLSN) is a global performance management company that provides a comprehensive understanding of what consumers watch and buy. Nielsen's Watch segment provides media and advertising clients with Total Audience measurement services for all devices on which content — video, audio and text — is consumed. The Buy segment offers consumer packaged goods manufacturers and retailers the industry's only global view of retail performance measurement. By integrating information from its Watch and Buy segments and other data sources, Nielsen also provides its clients with analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries, covering more than 90% of the world’s population. www.nielsen.com.
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