Discounters experience increase in fresh meat sales

Value for money supermarkets Aldi and Lidl have seen a rise in fresh meat sales in the face of an unpredictable market. 

“The grocery environment is hugely turbulent,” explained Ed Garner, communications director at Kantar Worldpanel.

“I’ve never seen it as turbulent as this. Aldi fresh meat sales are growing at over 40% and at 32% overall on fresh and chilled; it’s a bit of a go-to store for fresh meat. Lidl is also up 23% on fresh meat.”

Garner revealed the data at the Hybu Cig Cymru - Meat Promotion Wales (HCC) conference at Llandrindod Wells last month.

“The two discounters are getting a quality reputation and they are seeing spectacular growth. Aldi is growing again and Lidl’s rate of growth is increasing again – now up 14%.”

In addition to Aldi and Lidl’s solid performance, Waitrose has also seen an increase of an estimated 3% in a year, posing a threat to the major retailers. “The three gainers have added £6.7 billion in four years,” added Garner. “Compare with the others: it’s a huge problem for Tesco; Asda is under considerable pressure; and Sainsbury’s is holding up better than anyone else.”

Whereas the discounters once used their value products as their unique selling point, they are now starting to focus their marketing on the quality of goods.

Garner commented: “Aldi and Lidl used to be funny sheds that sold stuff you didn’t see elsewhere; now everyone goes there and their demographics are on the national average. However, they are not yet ‘the big shop’.”

It was noted by Garner that a major difference between the big four and the discounters was the offers available. While Tesco, Asda, Sainsbury’s and Morrisons exploited “buy one get one free” deals and offered discounts on selected products, Aldi did not promote goods in the same manner, according to Garner. They delivered a “here it is; here is the price” approach.

There has been a decline in budget labels, largely “because consumers think they are not good quality”. However, products provided by discounters are thought to be of good quality.

“So where is the fight back from the others?” challenged Garner. “The Waitrose chief executive said it was going to be ‘everything the discounters aren’t’; they talk about the provenance and their reasons for shopping are not about price. Waitrose is ploughing a furrow about the values of the shopping experience.”

One area where the big four still have an advantage over the discounters is online sales. “The internet is still growing – currently in double-digit growth, with young families purchasing at 12%. That’s where Aldi and Lidl are not – and it’s a bit of a defence.”

He said that discounters were developing more of an awareness into their market: “They understand the store experience is important. An example of this change is a new Lidl store that is to open soon. That will challenge your opinions of Lidl, what their stores are and what they represent.”

Meanwhile, independent butchers still possess 10% of the fresh meat market, although they are under pressure. Despite this, data from the most recent 12-weekly lamb shopper statistics have been positive.

“Over 12 months, there is a pattern that suggests the same number of people are still buying lamb, but they are buying less and at a lower frequency,” added Garner.

“This would be quite a gloomy outlook for the industry if it were not for the most recent 12 weeks. It’s completely different!

“The markets are up 1.8% in that time; they are buying 3.3% more per head and frequency is up 4.5%. Why? Because it’s such a turbulent, spiky market.”

He concluded by pointing out that when it came to lamb sales, butchers had the upper hand: “There is a huge profile difference between butchers and supermarkets. Fresh lamb is 16% of butchers’ sales and 9% in the grocers. Butchers tend to sell the premium roasting cuts; the grocers are at the cheaper end, including mince and stewing.

“Lamb’s strength is part of the older profile; it’s nothing new, but it remains a premise that, as you get older, you are more likely to be buying lamb and that means younger consumers have got to be your lifeblood moving forward.”

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