Grocery spend at UK convenience stores grew by +3.3% in the last four weeks ending 11th September 2021, outperforming the growth at UK supermarkets, which rose by +0.6% during the same period, reveals new data released today by NielsenIQ.
This shift toward the convenience channel is a result of a gradual return of pre-pandemic consumer habits. This comes as workers slowly return to offices, children are back in schools and there is less of a need to plan ahead for a big shop, with consumers looking to shop more locally, impulsively and ‘little and more often’.
According to NielsenIQ data, visits to all stores are up 10% compared with last year. However, visits are still down 6% compared to 2019, showing there is still headroom for growth at stores. The online share of sales remains steady at 12.4%, slightly down compared with the same period (13%) last year with the trend towards smaller online baskets.
NielsenIQ data reveals that shopper sentiment also appears to be upbeat as total till grocery sales for the four weeks ending 11th September 2021 rose to +1.8% compared to the same period last year. This is an improvement from +1.1% in August 2021 and a +7.3% growth in sales against 2019.
Meanwhile, shoppers spent £9.8bn at the major supermarkets 2 in the last four weeks ending 11th September which is £526m more than the same period in 2019 (+6%) indicating robust food retail spend for the end of Q3 even with the hospitality industry reopening.
Consumers are now returning to old shopping habits which include ‘shopping around’ with all UK supermarkets experiencing a jump in new shoppers over the last 12 weeks ending 11th September. Tesco (sales +1.4%) continues to gain overall market share (26.9% compared to 26.7% a year ago). M&S (+7.4%) also experienced strong growth in sales, meanwhile sales at Aldi (9.2%) continue to improve with Lidl (+15%) still the fastest growing retailer.
Mike Watkins, NielsenIQ’s UK Head of Retailer and Business Insight, said: “UK shopping habits are shifting once again, this time towards convenience channels as Brits return to more impulsive shopping behaviours that correspond with a return to pre-pandemic lifestyles. The warm weather in early September also helped. However, there remain some clouds on the horizon as rising energy costs and inflation could hit disposable incomes, whilst availability concerns could present challenges. However, grocers can still expect to look forward to a short term boost as some of the incremental spend has not yet returned to the hospitality channels, and shoppers are likely to plan in advance if household budgets are more constrained.”
Watkins concludes: “For retailers and manufacturers there are three challenges as we look ahead to the golden quarter. The first is to encourage bigger spends on every shopping trip now that habits are shifting away from a big shop online and towards new, and smaller missions at stores. The second is having inspiring media campaigns in October that help to build spend for the festive period and for the big Christmas shop. Finally, grocers must prepare for the tightening of budgets later in the year which means ranges and pricing must reflect this in order to resonate with price conscious consumers.”
Table: 12-weekly % share of grocery market spend by retailer and value sales % change