The latest NIQ data highlights contrasting trends among UK supermarkets with significant growth for some and sales declines for others.
- M&S and Ocado reported strong sales growth, with an increase of 10.7% and 14.3%, respectively, over the past 12 weeks.
- Conversely, Asda and Aldi experienced sales declines of 6.4% and 0.7%, underscoring challenges in the sector.
- A short heatwave and increased consumer shopping activity contributed to an overall 5.5% increase in UK supermarket till sales.
- Economic and seasonal factors, such as inflation concerns and the end of summer, continue to influence consumer behaviour.
The latest NIQ data underscores a period of dynamic market activity within the UK supermarket sector, where certain retailers have positively outperformed their competitors. M&S and Ocado have demonstrated remarkable resilience and adaptability, evidenced by their respective sales growth of 10.7% and 14.3% over the past 12 weeks. This growth is largely attributed to increased consumer spending on summer indulgences, fresh food, and groceries.
Conversely, Asda and Aldi face significant challenges, with sales dropping by 6.4% and 0.7%, respectively. This downturn is set against the backdrop of a shifting consumer landscape and increasing competitive pressure. NIQ’s Mike Watkins commented on the pressures to sustain growth as summer wanes, noting the possible impact of fewer seasonal events and evolving consumer routines.
Overall, UK supermarkets experienced a 5.5% rise in till sales over four weeks leading up to 10 August 2024, marking the highest annual growth. This surge was supported by a short heatwave that stimulated consumer purchases. Additionally, an uptick in digital engagement was observed, with online sales climbing 6.8%, contributing to a 12.8% share of FMCG spending—an increase from 12.5% the prior year.
Retailers are focusing on maintaining consumer spending during the post-Euro 2024 period, leveraging the warm summer as a driver for sales. However, the persistent concern over inflation, which remains a key issue for 29% of households, forces retailers to innovate loyalty and membership schemes to sustain consumer interest and spending.
The supermarket sector is poised to confront forthcoming economic challenges, including consumer inflation concerns and competitive pricing pressures. As Q4 approaches, retailers will likely intensify efforts in comparative price advertising to solidify their market positions.
In sum, while certain UK supermarkets experience formidable growth, others are navigating sales declines amidst evolving consumer trends.
