Tesco recorded the fastest growing sales of the country's four biggest supermarkets for the second consecutive month, according to Nielsen retail data released today.
During the 12 weeks ending 20 May 2017, Tesco increased sales by 2.2%, noticeably ahead of the 1.4% for Morrisons, 1.2% for Sainsbury’s and a -0.1% decline for Asda.
“Tesco’s re-focus on the customer and their changing needs, such as simplifying ranges and promotions, has meant they’ve not only attracted new shoppers but encouraged them to visit more often,” says Mike Watkins, Nielsen’s UK head of retailer and business insight. “These incremental improvements are helping reverse the declining spend per visit which was an ongoing challenge for Tesco last year. The growth is also now being supported by initiatives which revisit some wider consumer trends such as tackling food waste and supporting healthier eating and living.”
Tesco’s strong performance is further highlighted by the most recent four-week period; its sales grew at four times the +0.2%¹ rate of that across all the supermarkets. This rather flat overall market growth was driven by underlying food price inflation, as the volume of goods sold fell -2.3%¹.
“The return of inflation has helped supermarket grow sales but the challenge for the summer is to sustain this by encouraging shoppers to put more items into the weekly basket,” says Watkins. “Two tailwinds that should help are the six weeks up to the school holidays always being a good trade-up opportunity for retailers, with seasonal, fresh and ‘al fresco’ dining top of mind for shoppers. Alongside this, rising inflation means people will be more aware of balancing household budgets, which may encourage spending more on eating at home, rather than at restaurants.”
Watkins also notes an inherent advantage the supermarkets have over the discounters, with 26% of all grocery sales now happening in Convenience stores, “Although discounter growth continues through new store openings, the supermarkets still have a wider variety of formats, including online and local convenience stores, giving them a lot of scope to grow basket spend around different shopper missions.”
He adds, “Location still matters but lifestyle needs are becoming more important for consumers.”
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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