Grocery sales increased in value by 3.4% year-on-year in the 12 weeks to 28 January, despite a seasonal dip in shopper spend post-Christmas, according to new figures from Kantar Worldpanel.
The data revealed that after a record-breaking Christmas, January saw customers rein in their spending, with shoppers spending £1.6bn less in the grocers compared with the month before.
Households saved £63.04 on average over January compared to December 2017: customers spent £3.39 less every time they shopped and sales of premium own-label products nearly halved, Kantar revealed.
Fraser McKevitt, head of retail and consumer insight at Kantar Worldpanel, said New Year’s resolutions also had an impact on the grocery market.
“Trends like Veganuary have taken off and now 29% of evening meals contain no meat or fish at all. This sustained interest in vegan and vegetarian diets is reflected in the chilled aisles – over January one in ten shoppers bought a meat-free ready meal, causing sales to rocket by 15% compared to this time last year. Sales of spinach, cherries and aubergine also grew strongly compared to the past 12 months – up 43%, 25% and 23% respectively. “
McKevitt added: “Despite a renewed focus on healthy eating, the cold weather has taken its toll on Britons, as has a national outbreak of influenza. January sales of over-the-counter painkillers rose 12%, while cough sweets and liquids increased by 17% as shoppers tried to tackle seasonal colds.”
Kantar Worldpanel’s figures reveal that Lidl was again the UK’s fastest-growing retailer. The discounter experienced a market share increase of 0.5 percentage points and saw sales climb by 16.3% year-on-year.
McKevitt said: “Traditionally focused on own-label lines, Lidl has actually seen fastest growth among its branded products, which are up by 28% and now account for 12% of all sales.”
Meanwhile, Tesco still remains the fastest growing of the big four, with sales up by 2.6%. Despite shoppers increasingly opting for vegan options, such as the grocer’s new ‘Wicked Kitchen’ range, Tesco saw the greatest sales growth from its dairy and produce lines.
Keith Richardson, managing director retail sector at Lloyds Bank Commercial Banking, said: “The determination to stick to their new year’s resolutions helped shoppers start 2018 the way they finished last year – by finding ways to keep spending at the checkout.
“Their baskets may have looked significantly different – with trends like Veganuary and dry January ensuring there was a lot more fresh food and a lot less alcohol than in December – but consumers’ ability to carve out a little extra cash from their discretionary spend to make way for their everyday essentials remains undiminished.”