The latest United Kingdom grocery share figures from Kantar Worldpanel, published for the 12-week period ending on June 19, 2016, show the market slipping into decline for the first time since January, with supermarket sales falling by 0.2% as like-for-like grocery prices dropped by 1.4% compared with last year.
Looking at the longer 52-week period ending on June 19, however, it’s clear that Brits were sweet on frozen confectionery products as sales climbed 7% to top £300 million. The frozen fish category saw a value rise of 1.5% to approximately £760 million, while turnover in the frozen potato segment edged up 0.4%.
“It is no surprise that there has been a rise in value and volume sales in the frozen confectionary category,” said Brian Young, chief executive of the British Frozen Food Federation (BFFF). “Recent new product development from the likes of Iceland and Tesco, which have created great frozen confectionary products such as Luxury French Crème Brulée and Salted Caramel Gateau, have really showcased the high quality of frozen products available to consumers.”
He continued: “The frozen food industry is leading the way in NPD. With products such as Mini Salmon Wellingtons with White Wine and Cheese Sauce available from Aldi, it is no surprise that consumers are spending more on frozen fish products.
Impact of Retail Price War
Meanwhile, Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, reflecting on the overall downturn in turnover generated in the UK grocery market during the past quarter, commented: “The decline is a continuation of the slow supermarket sector growth dating back to summer 2014, primarily a result of cheaper everyday groceries brought about by a retail price war.
“While these latest figures predate the EU referendum result, the immediate economic uncertainty is unlikely to cause a substantial fall in grocery volumes, as demonstrated by the 2008 financial crisis when basic food, drinks and household sales proved resilient.
“With an estimated 40% of the food we consume sourced from overseas, any long term change in exchange rates may threaten the current period of cheaper groceries. Historically, higher prices have led to consumers looking for less expensive alternatives such as own-label products, seeking out brands on promotion or visiting cheaper retailers.”
Record Share for Leading Discounters
The combined share of discount retailers Aldi and Lidl has hit a record high of 10.5%, with each holding 6.1% and 4.4% of the market, respectively. Almost three fifths of Britons – 58% – visited one of the two retailers in the past 12 weeks, with Lidl increasing sales by 13.8% and Aldi by 11.5% on a year ago.
McKevitt commented: “It’s been a good period for the smaller retailers. Co-op’s growth of 2.0% has cemented its recent revival, heralding a full year of increasing sales. Meanwhile, at Waitrose, small but rapidly increasing sales of its premium Waitrose 1 brand have helped the retailer grow by 1.3%. Waitrose has now had an unbroken period of growth dating back to 2009 – the best run of any retailer outside of the discounters.”
The performance of the larger retailers was a continuation of recent trends. Overall sales at Tesco dropped by 1.3%, while receipts at Morrisons fell by 2.4%, both reflecting the ongoing impact of store disposals. At Sainsbury’s sales slipped by 1.4%, while at Asda they were down by 5.9%, with each of the big four losing market share on last year.
