Total Till grocery sales soared to 11.1% in the last four weeks ending 25th February 2023, up from 7.6% recorded in January as a result of accelerating food inflation (14.5% in February), reveals new data released today by NIQ (previously known as NielsenIQ).
NIQ data shows that Total Till sales growth comes despite a lack of availability in a few fresh produce categories which impacted sales in the last two weeks. Total value sales in the fresh produce category grew just 1.1%, with a unit decline of 5.4%. Supermarkets struggled to meet demand for certain products, such as tomatoes, where unit sales declined by -17.6% with vine tomatoes worse hit (-28.9%), and peppers (-16.8%). However, value sales for products that were available such as lettuce (13.7%) and cucumber (31.8%) increased despite limited availability.
The consumer intelligence company states that volumes at the Grocery Multiples fell by 4.1% in the last four-week period, indicating that although inflation is still rising, shoppers’ varying coping strategies and the additional private-label price cuts by retailers are helping to alleviate the impact of inflation on shopping baskets. While volumes are down compared to the same period in 2022, they are broadly unchanged over the last 12 weeks (-4.0%); higher inflation is boosting value sales but declining volumes are no worse.
However, despite the squeeze on purchasing power, there was incremental spend for Valentine’s Day and over the February half-term which helped lift value growths at the Grocery Multiples to 8.2%. Compared to last year, there was an increase in sales for boxes of chocolates (+23%), fresh roses (+20%), mixed floral bunches (+14%) and sparkling wine (+4%) and many households enjoyed the occasion at home with a “Dine in” meal deal.
According to NIQ, in-store visits continue to rise (8.7%) and sales at stores are up (13.1%) which is at the expense of online sales, which fell by 2.5% as a result of fewer shoppers and less spend. Compared to Total Till figures in February 2022 (12.4%), online share of FMCG sales dipped once again to 10.9% now that pandemic shopping behaviour is becoming a thing of the past.
While the discounters Aldi (+25.6%) and Lidl (+21.1%) continued to gain market share, NIQ data reveals that convenience store value sales grew by 8% with volume sales (+1.4%). This suggests that some shoppers prefer to visit convenience stores to limit their overall grocery spend.
Mike Watkins, NIQ’s UK head of tetailer and business insight, said: “Promotional spend continues to be low and stable at 20% of all FMCG sales4 with longer-term price cuts and price locks now favoured by retailers and preferred by shoppers to short-term promotions. This also helps give shoppers more price transparency across different retailers which is important when prices are increasing.”
Watkins continues: “And the attractive pricing around Valentine’s meal offers gave a boost to some discretionary categories which suggests that shoppers are still looking to trade up for special events and spend on treats and indulgences, provided they can make savings on everyday grocery items.”
Watkins concludes: “Discounters sales continue to accelerate and we currently have the fastest growth in this channel over the last decade. With food and drink inflation not expected to slow just yet and shoppers paying more for all essential items (including their energy bills) we can expect lower prices – in particular supermarkets’ own label ranges – to be the key messaging from all retailers over the next four to six months.”
Table: 12-weekly % share of grocery market spend by retailer and value sales % change
