A week of hot summer weather at the end of June, England reaching the final of the Euro 2024 soccer championship and promotions on branded goods drove UK grocery sales over the last month, industry data has shown.
Market researcher NIQ said sales at UK supermarkets grew 3.6% year-on-year over the four weeks to July 13, up from growth of 1.1% in last month's report.
The data is the most up-to-date snapshot of UK consumer behaviour published since the July 4 national election, which saw the Labour Party return to power after 14 years of Conservative rule.
NIQ said that while the overall level of promotional spending was maintained at 25%, some 38% of branded fast moving consumer goods (FMCG) sales were purchased on promotion, up from 33% a year ago.
This was driven by beers, wines and spirits where promotions accounted for 51% of sales, the researcher said.
Influencing Shoppers
“The three major things that influence how shoppers spend are the weather, events and increased promotional activity. In the last few weeks all of these have been in play," Mike Watkins, NIQ’s UK head of retailer and business insight, said.
NIQ said that over the four week period, online sales increased 3.8%, with the channel's share of total sales growing to 12.9%, from 12.7% this time last year.
Official data published last week showed overall British retail sales volumes fell by more than expected in June.
Ocado The Fastest-Growing
Echoing data from rival market researcher Kantar last week, NIQ said online grocer Ocado enjoyed the fastest growth over the period with sales up 12.9%, followed by Marks & Spencer with sales up 8.6%.
Market leader Tesco, No. 2 Sainsburys, discounter Lidl and Waitrose also gained market share.
But No. 3 player Asda was again the laggard. Its sales fell 5.9% and it lost 1.1 percentage points of market share over the year.
Consumer Confidence
“We also saw subdued growth in consumer confidence compared to previous months," Watkins added. "Whilst this sentiment may have a more direct impact on wider retail spend, such as big ticket items, for food retail it is the return of CPI inflation to 2% and increased promotional activity that encourages shoppers to spend.
"With the summer holiday season underway, retailers will need to encourage shoppers to keep spending for as long as the sun keeps shining and then have some compelling offers ready for back to school in September.”
Additional reporting by ESM
