Consumer spending is slowing and the grocery market is getting tougher, latest figures from TNS suggest.
For the twelve weeks ended August 12, market growth dipped to three per cent. This is a fall from a three-year peak of six per cent for the 12 weeks ended May 20. TNS suggests that concentration on price competition by the major multiples is part of the cause.
However, despite Tesco’s swingometer advertising campaign, Asda and Sainsbury’s are also managing to join the market leader in exceeding the total growth rate for the period. The three market leaders have all grown their share and now together account for almost 65 per cent of the entire grocery market in the UK.
There is also good news for independents, and TNS believes the latest figures show that many have now found their position in the market. “Whilst the independent sector has suffered over the years, it appears that the remaining outlets have found their niche, as they have also outperformed the market and lifted share from 2.7 to 2.8 per cent,” said Ed Garner, director of research at TNS Worldpanel. “In fact, their share has shown solidity over the last 17 data releases.”
The picture is slightly different for the discounters. “Aldi and Lidl are posting market-leading growth of nine per cent and 10 per cent respectively, while Netto matches the market growth of three per cent and therefore holds share,” said Garner.
Somerfield is finding the going tough. “It again finds itself in negative territory,” said Garner. “Its sales decline of eight per cent brings its share down to 3.9 per cent, from 4.4 per cent a year ago. However, the owners, the Robert Tchenguiz consortium, have announced refinancing and some acquisition plans, so it is hoped that this situation improves.”
Morrisons is just missing out on holding share, with its sales growth dipping to two per cent. This is just one percentage point below the market.
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