• Total Till growth slowed in July following the unusually high growths in June, brought on by the heatwaves and peak inflation
  • Discounts and promotions account for 22.5% of retail sales, highest in the last 12 months except during Christmas and Easter
  • In-store sales (+9.4%) grow ahead of online (+4.3%) as shoppers spend £800m more in store than this time last year, with Brits also sharing grocery spend with value retailers like B&M, Home Bargains and Poundland

Total Till sales at UK supermarkets slowed to +8.9% over the last four weeks ending 15th July 2023. This is a decline from the +12.4% recorded in June 2023, reveals new data, released today by NIQ (previously known as NielsenIQ).

According to data from NIQ, this drop in sales is partly due to the unusually high growth experienced the previous month, meaning it is an expected slowdown to growth. However, this is also combined with a slowdown in food inflation and trading against previous high comparatives which included the acceleration of inflation this time last year.

NIQ data shows that volume sales at the Grocery Multiples also weakened to -3.6% (from -2%)1 as shoppers sought to readjust spend ahead of their summer holidays. This was also aided by the cooler and wetter weather during the w/e 14th July leading to less occasions for shoppers to socialise and spend on additional items and the start of last year’s heatwaves. As a result, July was the first time shoppers spent less than a prior period since the seasonal lull in January and last September, which was after the summer heatwaves.

In terms of category performance, growth slowed for dairy products (+9.4%) and frozen foods (+7%) amidst retailer price cuts. However, there was an increase in sales of confectionery (+16.5%), packaged grocery (+13.4%) and crisps and snacks (+12.8%), with confectionery sales seeing the fastest growth.

Bargain hunting boosts in-store sales

According to data from NIQ, as more retailers reduce prices to help households cope with rising costs of living, promotional activity is slowly gaining momentum with shoppers, now accounting for 22.5% of grocery sales, up from 20% in the same period last year. This is the highest over the past 12 months except at Christmas and Easter.

Bargain hunting among shoppers has maintained the gap between in-store sales (+9.4%) and online (+4.3%) as shoppers spent £800m more in store than this time last year. This has helped the discounters maintain strong growth with sales increase for Aldi (+22.3%) and Lidl (+17.9%), with both retailers attracting more shoppers. These retailers are also selling more fresh food2 than a year ago, and these categories are accounting for over a half of the incremental sales growth at the discounters in the last 4 weeks.

As Brits seek out more ways to cut costs on the grocery bills, NIQ data also shows a growing demand for the value retail chains, like B&M, Home Bargains and Poundland where FMCG sales increased 11%.3 NIQ data shows that 70% of households visited them over the last year, with 73% shoppers seeking lower prices and 45% for household products at these retailers.4

Mike Watkins, NIQ’s UK Head of Retailer and Business Insight, said: “Shoppers continue to seek out value by looking for bargains, we’re seeing them become more channel agnostic and less likely to remain loyal to many supermarkets. The value retail channel is becoming a destination for many households for snacks, household, and personal care as well as certain branded packaged grocery items.”

Watkins concludes: “Over the next eight weeks, we expect to see a similar pattern on spending with little improvement in volume sales as school holidays kick off. The battleground for shopper loyalty  is now shifting – retailers must be prepared to build on the trend to shop little and more often when consumers revert to their usual shopping patterns post holidays.” 

Table: 12-weekly % share of grocery market spend by retailer and value sales % change

Unless otherwise stated all data is NIQ Homescan Total Till

1NIQ Scantrack Grocery Multiples

2 Fresh Food is defined as bakery, chilled & deli, fruit and veg, meat, fish and poultry

3 Homescan FMCG 4 weeks ending 15th July 2023

4 Homescan Survey February 2023

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