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Discounters got UK Christmas, Sainsbury's big loser

Staff Writer |
Shoppers continued their shift towards discounters Aldi and Lidl over Christmas, while Asda and Tesco enjoyed the best of the season among the big four supermarkets.

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UK grocers increased sales 1.6% to £29.3bn in the 12 weeks to 30 December, according to research by Kantar Worldpanel, which was the slowest rate of growth since March 2017.

Overall spend was tempered by lower inflation of 1.3% compared to the like-for-like inflation of 3.6% recorded the previous Christmas.

"This slower inflation rate helped shoppers to manage their festive budgets, with 60% of customers looking to make savvier decisions to make their money go further over the holidays," said Fraser McKevitt, head of retail and consumer insight at Kantar.

German limited assortment discounters Aldi and Lidl achieved their highest-ever combined festive market share of 12.8%, with two-thirds of all households shopping at one or the other at some point in the period.

Another trend, identified in research from Nielsen also released on Tuesday, shoppers visited more supermarkets more frequently this Christmas. While the number of trips increased as high levels of vouchering and price discounting encouraged shoppers to visit a variety of supermarkets, the average spend per visit fell by 3% in the four week period to 29 December compared with an increase of 3% in average spend in December 2017.

As per Nielsen's research, grocery sales growth slowed to 1.8% in the last four weeks of the period, almost half the growth of 3.7% enjoyed at the same time last year.

Kantar's calculations showed Aldi's 10.4% growth in the 12-week period was the fastest growth in the market.

The group's marketing efforts are paying off, especially in sales of vegetables, said McKevitt. "The return of Kevin the Carrot contributed to an 18% increase in carrot sales and nearly one in five households bought the vegetable at the discounter."

Lidl enjoyed growth of 9.4%, of which nearly one-third came through sales of branded products.

Asda came top among the big four, with overall growth of 0.7% as its 'Extra Special' range was the fastest growing of any premium line of the major retailers. Asda was also boosted by e-commerce sales rocketing 12%.

In second place was Tesco's growth of 0.6%, with a boost from an extra 125,000 customers, particularly at its larger stores. Kantar noted that Tesco was the only retailer to increase its promotional activity year-on-year, though its market share fell 0.3 percentage points year-on-year to 27.8%.

Morrisons, which also released its festive trading update on Tuesday, saw its growth slow to 0.1%, with its market share dropping to 10.6% from 10.8%.

Sainsbury's was the worst performer again, with sales falling 0.4% and market share down 0.3 percentage points to 16.2%.

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