Discounters grab market share while traditional retailers struggle

Progress remains slow for mainstream retailers while the discounters continue to grow, the latest UK supermarket data from Kantar Worldpanel has revealed.

A battle is expected between two of the big four, with Kantar data showing that Tesco and Sainsburys both saw a 1.3% sales decline for the period, taking their market shares down to 28.6% and 16.5% respectively.

Similar declines in sales have put these retailers against each other, with Clive Black of Shore Capital expecting the two of them to go head-to-head to re-engage with customers and recover some of those lost sales.

Asda declines

Asda had the worst period in terms of sales, down 3.5%, leaving it with a 16.5% share, level with Sainsburys, and way behind Tesco. Black expects them to stay the course in terms of strategy in an attempt to fight off the rise of the discounters.

The Co-operatives sales were flat for the 12 weeks and its market share remained at 6.2%, keeping it slightly ahead of the discounters for now.

Morrisons was the only one of the big four to see growth, albeit a modest amount (0.6%), which was attributed to its online offering. The retailer now has an 11% market share. Waitroses sales grew 1.2%, allowing it to hit a 5.1% market share.

Discounters win big

The real success story for the period was the discounters. Aldi increased its sales by 15.4% to reach a new market share high of 5.5%, while Lidls sales grew 9.1%, creating a 3.9% market share. This growth by Aldi represents the fastest overall sales momentum for the period and means it has overtaken Waitrose in terms of market share.

The overall grocery market for the 12 weeks to 21 June 2015 saw a slight decline (0.1%) in the amount of money passing through the tills compared to the same period last year. The price of groceries is now 1.7% cheaper than last year, with prices consistently dropping since September, however sales volumes are up 2%.

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