An analysis by Kantar highlights the impact of a wet spring on consumer spending patterns, with specific changes in grocery sales.
- Wet weather has led to the slowest monthly growth in grocery sales in two years.
- Nearly a quarter of surveyed households continue to struggle financially amid the cost of living crisis.
- However, the number of financially ‘comfortable’ households has increased due to declining grocery price inflation.
- Grocery categories such as sun care items have seen a drop in sales, while soup sales have risen.
Research firm Kantar reported that wet weather conditions resulted in the slowest monthly growth in grocery sales observed over the past two years. The adverse weather deterred consumers from frequent shopping trips, juxtaposed with the ongoing cost of living crisis impacting purchasing decisions.
The cost of living crisis continues to be a significant concern, as evidenced by nearly a quarter of the surveyed households indicating financial struggles. However, Kantar noted a positive shift, with a notable increase in financially ‘comfortable’ households, a result attributed to easing price pressures and the anticipation of increased spending coinciding with the upcoming Euros football tournament.
Fraser McKevitt, Kantar’s head of retail and consumer insight, remarked, ‘The cost of living crisis isn’t over – far from it. However, there are positive signs that many of us no longer feel the need to restrict our spending quite so much.’ This sentiment is supported by Kantar’s analysis showing a 2.1% grocery price inflation over the four weeks leading up to June 9, marking the 16th consecutive month of declining inflation rates. These trends have led to over one-third of the 10,500 surveyed describing their financial position as comfortable, the highest level since November 2021.
Despite improved financial sentiment, the inclement weather significantly dampened overall grocery spending, notably within categories associated with warmer weather. Sales of sun care items saw a 25% reduction, while prepared salad sales dropped by over 10%. Conversely, sales of warm fresh soups surged by nearly 25%, although this uptick was insufficient to counterbalance the overall decline in grocery sales.
The Office for National Statistics recently highlighted that wet weather conditions in April had adversely impacted consumer spending and activity within the construction industry. Though scientists caution against attributing specific weather patterns to climate change, there is a consensus that extreme weather events are becoming more frequent.
Kantar predicts a spending increase driven by the forthcoming Euros football tournament, corroborated by a 40% rise in beer and cider promotions over the past four weeks. ‘Retailers will be competing with fans heading out of the house to watch the football as well as with each other,’ McKevitt noted.
The data from Kantar also underscores shifting dynamics among supermarket chains. Ocado emerged as the fastest-growing grocer for the fourth consecutive month, with sales rising by over 10%, closely followed by Lidl. Tesco, the UK’s largest supermarket chain, also saw an increase in market share. However, these gains came at the expense of chains such as Asda, the Co-Op, smaller chains, and independent supermarkets, which experienced a decline in market share.
In conclusion, while wet weather and the cost of living crisis have tempered overall grocery spending, there are emerging positive trends in consumer financial sentiment and shifting market dynamics among supermarket chains.
