Press Room

Tesco recovery continues amidst wider grocery deflation

Retailer’s most encouraging year-on-year sales figures since Nov 2013

London, 8 March 2016. Tesco continues to steady its falling sales, registering its lowest year-on-year sales declines for more than two years – according to the latest UK supermarket performance figures from global information and insights company Nielsen.

In the 12 weeks ending 27 February 2016, year-on-year sales at Tesco were down just -0.5%. This was its third consecutive quarter of improvement and the retailer’s best performance since the 12 weeks ending 9 November 2013.

This comes against a backdrop of deflation for the market as a whole where, during the four weeks ending 27 February 2016, sales volumes fell -0.8%¹ – the sixth consecutive decline – and sales value fell -1.1%

“Tesco’s turnaround continues,” explains Mike Watkins, Nielsen’s UK head of retailer and business insight. “Building on the sometimes overlooked fact that three in four households shop there, Tesco has been improving the basics, including its pricing. This has encouraged more visits and attracted back shoppers who’d previously defected.


“Their new customer proposition highlights the benefits of having a large variety of store types – physical and online. Supermarkets offering more locations, good private label and a superior customer experience – not just lower prices – tend to be more successful, and these are some of the areas where Tesco are focusing.”

Performance of other retailers

Asda had the largest drop (-5.0%) in year-on-year sales among the top 10 supermarkets during the 12-week period. Sainsbury’s, whose sales were flat, was the only top-four supermarket not to see a drop in year-on-year sales.

Aldi had the highest sales increase (17.1%), followed by Lidl (15.7%).

Watkins notes: “The Co-operatives are gaining share with a virtuous growth cycle of more shoppers visiting more often, which will be enhanced by further price cuts during the rest of the year. Meanwhile, Morrisons’ sales growth is still impacted by store closures and disposals, as well as the new ‘Price Crunch’ initiative. Early indications show that this marketing campaign may help them hold on to current shoppers and improve volume growths in the run up to Easter.”

Watkins concludes: “The supermarkets have been forced to combat the rise of the discounters by cutting prices to stimulate sales. However, not all supermarkets are seeing a compensatory rise in volumes, as shoppers are still increasingly buying more from the discounters.” 

– ENDS –

Notes
All figures are from Nielsen Homescan Total Till unless otherwise stated
¹Source: Nielsen Scantrack Grocery Multiples

About Nielsen Homescan Total Till
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.

About Nielsen Scantrack
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 £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 £121bn of all GB food, drink and supermarket general merchandise sales.

About Nielsen
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 across all devices where 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 provides its clients with both world-class measurement as well as analytics that help improve performance. Nielsen, an S&P 500 company, has operations in over 100 countries that cover more than 90 percent of the world’s population. For more information, visit www.nielsen.com

More information
Alex Burmaster
Meteor Public Relations
Tel: 020 3544 3570
Mob: 0780 313 1144
[email protected]

Neil Beston
PR Director, UK & Europe
Nielsen
Tel: 020 3103 3959
Mob: 07770 644136
[email protected]