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Discount retailers' success

Matt Dickinson
20/ 8/2008

DISCOUNT supermarkets have made further inroads into the grocery market as customers target cheaper goods, industry research has shown.

Operators Aldi, Lidl and Netto saw their combined market share rise to a best ever 6.1 per cent, figures from TNS Worldpanel said. Aldi saw sales grow 19.8 per cent during the 12 weeks to August 10 compared to the prior year, the data showed, with Lidl 12.3 per cent ahead.

Frozen food chain Iceland also enjoyed sales growth of 14.4 per cent during the period, to take its market share up to 1.7 per cent.

There was more evidence of customers turning away from higher priced stores with another survey from Nielsen showing Marks and Spencer's share of grocery sales during the four weeks to August 8 falling 2.1 per cent compared to a year ago. Waitrose's market share growth was also limited to 0.4 per cent, the data showed.

TNS's till roll figures showed overall industry sales grew by more than 7.2 per cent on a year earlier, fuelled by food price inflation of 6.8 per cent in the three months to mid-July.

There were drops in market share for giants Tesco and Sainsbury's, from 31.8 per cent to 31.6 per cent and 16.1 per cent to 15.8 per cent respectively.

Asda's share rose to 17 per cent from 16.8 per cent, while Morrisons edged up to 11.1 per cent from 10.9 per cent.

TNS Worldpanel's Ed Garner said the figures were the "clearest picture yet that retailers with a clear price message are posting the strongest performances".