Following today’s release of Sainsbury’s figures for the 16 weeks ending 4th January 2025; Zoe Mills, lead retail analyst at GlobalData, a leading data and analytics company, offers her view: “Sainsbury’s has emulated Tesco’s positive festive performance, outperforming Aldi as both it and Tesco fight back against the threat of the discounters. While Tesco reported 4.1% UK Christmas like-for-like growth, Sainsbury’s was not far behind, with its festive grocery sales rising 3.8% (in the six weeks 4 January 2025), highlighting that the grocer’s focus on quality has encouraged shoppers to trade up to its premium own-brand ranges. Its Taste the Difference sales rose 16% across key Christmas weeks, as consumers entered this festive season willing to indulge in finer foods and seeing Sainsbury’s as a destination for these products.
“Sainsbury’s GM did well over the festive period, with sales (which includes clothing) rising 3.4%. Sainsbury’s gifting range enticed shoppers to splurge while doing their big weekly shop, with its quality perception pushing through from food into non-food. Its clothing range will have also appealed to shoppers, particularly categories such as pyjamas, a staple Christmas present for many, with its range of branded and own-brand products appealing to different budgets. Given its appeal within GM for gifting occasions, Sainsbury’s must maintain this momentum as we enter 2025, with Valentine’s Day not far away. It must showcase dining-in options coupled with indulgent treats such as boxes of chocolates and bottles of wine to entice larger basket sizes among Valentine’s Day shoppers.
“Argos performed reasonably well over the festive period, with sales up 1.1% for the eight weeks to 4 January 2025 (an extended period to encompass the earlier falling of Black Friday in the previous financial year). However, promotional events drove this result. Argos must ensure its performance outside discounting periods improves, focusing on value for money and encouraging more full-price sales. With more competitors in the Toys & Games sphere, an area it underperformed in this year, with WH Smith’s partnership with Toys “R” Us and Tesco’s with The Entertainer, Argos has many challenges to navigate in 2025.
“For the quarter, Sainsbury’s achieved a 2.7% uplift, and this would have resulted in reasonable volume growth as inflation levels in the food sector eased off at the back end of the year. Yet, its performance was dragged down by Argos which reported a 1.4% decline during the period. Sainsbury’s total Q3 performance was marginally below Tesco, which witnessed a 3.3% growth in group sales in Q3. However, Tesco’s success in non-food, up 4.0%, is a significant threat to Sainsbury’s. Investment in its digital Argos proposition is integral to improving its prospects in 2025 as Tesco is expected to expand its online marketplace. It must also focus on being price competitive with Amazon and concentrating on its fulfilment options to entice shoppers to see it as the destination for technology, home items and toys.”
